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Zinc Co Australia

Zinc Co Australia shares surge on magnetite iron exploration target

Zinc Co Australia (ASX: ZNC) has announced an exploration target of up to 1.2 billion tonnes for magnetite iron ore mineralization at its 100% owned Mount Alexander project in Western Australia.

Grade range estimates are 25% to 35% Fe and 40% to 55% SiO2.

The exploration target is restricted to the 4.2 km outcrop of banded iron formation (BIF) on the north western limb of the Mount Alexander anticline.

It does not include 2.3 km of BIF outcrop around the closure of the anticline and on the eastern limb. Nor does it include a 3.3 km long aeromagnetic anomaly under shallow cover to the west in a tenement application owned 100% by Zinc Co. Sparse outcrop indicates that this western magnetic anomaly is caused by BIF.

The exploration target estimate is based on results of diamond drilling just completed in 2010
and 1:2,500 scale detailed mapping completed in 2009. Three diamond drill holes were completed in February 2010.

Positive assay results from initial drill testing include 86 metres @30.9% Fe and 118 metres @ 29.6% Fe.

The surface mapping was completed by independent consultants, Jigsaw Geoscience, who have expertise in structural geology applied to Banded Iron Formations.

The mapping and drilling results show that the BIF horizon has been folded in a concertina style so that the BIF is repeated across strike around the level of the current land surface, resulting in outcrop widths of up to 350 metres.

The estimate of exploration target tonnage was derived from a three dimensional model created from the data listed above. Firstly, interpretation of sub-surface geology was completed on 16 sections at 300 metre spacing along the 4.2 km mapped outcrop.

BIF outlines were then digitized from the geological sections and formed into volumes, limited by a digital terrain model, using Gocad software. Tonnage was estimated at various depth slices by applying a density of 3.5t/m3 to the BIF volume. Grade was estimated from the drilling assays supported by results of 580 surface rock chip samples collected by Zinc Co.

Davis Tube recovery tests on composited assay pulps are in progress. RC drilling is being permitted for the 3.3 km long aeromagnetic anomaly to the west of Mount Alexander to establish the thickness and grade of the magnetite body.

The Mount Alexander project is near the port of Onslow, 260 kilometres south west of Karratha and well located with respect to infrastructure. The North West Coastal Highway is 10 kilometres west of the project and the Dampier Bunbury gas pipeline passes to the west of the highway.

The project consists of three exploration licenses. E08/1410 was recently purchased outright and is in the process of being transferred to 100% Zinc Co ownership (see ASX release 14 Oct 2009).

E08/1972 and E08/2046 are applications, also owned 100% by Zinc Co. The Mount Alexander BIF is associated with a sequence of amphibolite, dolomite, schist and quartzite of Proterozoic age in the northern Gascoyne Province.

These rocks have been folded into a regional scale north east trending anticline and metamorphosed to upper greenschist and amphibolite grade. The core of the anticline is intruded by the Mortgage monzonite stock which is related to tungsten and lead zinc mineralization in the area.

Zinc Co Australia shares rose 11% to 19 cents in trading today.