Rathdowney Resources (CVE:RTH) said it has made further progress in phase 2 of developing its Olza zinc-lead-silver project in southwest Poland, increasing the mineral resources and advancing baseline data collection.
The company said the latest mineral resource estimate is based on full phase 1 drilling at the Zawiercie and Rokitno concessions, as well as historical information, with over 1,000 drill holes taken into account.
Inferred resources are now estimated at 24.4 million tonnes grading 7.02% zinc plus lead at a 2% zinc cut-off, representing a 15 percent increase in resource tonnes and a 9 percent bump in contained zinc and lead from the previous estimate in September 2012.
The new resource --- which includes 2.98 billion pounds of contained zinc and 802 million pounds of lead --- provides an expanded base for its preliminary economic assessment, which is due out this quarter.
The company is also well into the permitting process at its flagship project, both environmentally and technically, recently undertaking a major milestone with the approval of its geological documentation by the Ministry of Environment in Poland. This allowed the company to renew its exploration concessions and gave it the exclusive right to apply for an exploitation concession for a period of five years.
It has also advanced its baseline data studies to support the environmental assessment for the project, with the hydrogeological compilation close to being finished, and flora and fauna data collection programs more than 50 percent complete.
"There has been excellent recent progress at Project Olza," said president and chief executive officer Robert Konski.
"Our recent deposit modelling has provided a larger mineral resource and a more refined understanding of the geometry and grade of the Olza deposit. This understanding will significantly enhance engineering and mine planning activities that are currently underway."
"We expect to complete baseline data collection work in mid-2015, which in combination with the results from mine planning studies will set the foundation for the environmental assessment."
The company’s project, which covers three exploration concessions --- Zawiercie, Rokitno and Chechlo --- is spread over an area of 150 square km in the Upper Silesian Mining District of Poland.
This is an area known for its Mississippi Valley-type zinc lead deposits, which have been mined here continuously since the 12th century, producing some 16 million tonnes of zinc and 4 million tonnes of lead.
The project is just one hour away by vehicle from Krakow, and located just 10 km north of the large operating Pomorzany underground mine, thus nearby a railhead with access to concentrating and smelting facilities. There are a total of five historical mines along the same belt.
After Rathdowney has obtained its terms of reference for and filed the Polish environmental impact assessment (EIA), and the preliminary economic assessment is finished, it will look to complete a parallel track of both a pre-feasibility and feasibility study at the same time. It will also have to prepare the Polish equivalent to a development plan, called a PZZ, after which it will be able to apply for exploitation licenses.
The goal is to wrap up all permitting documentation by the end of 2016, with the expectation that construction will last between 18 to 24 months, meaning operations are targeted for some time in 2019.
The company says the project's reasonable capex requirements and preliminary metallurgical results are stand-out characteristics of the Olza deposit.