Ironbark Zinc (ASX:IBG) along with its partner China Nonferrous, continues to make good progress developing the Citronen zinc project located in Greenland.
Citronen is one of the world’s largest zinc projects and recently was awarded a 30 year mining permit, a major milestone in the project’s advancement.
Ironbark continues to work with NFC targeting 70% of the project financing through debt and an option for a further 20% of the project financing through direct project investment.
This funding pathway has the potential to provide an exceptionally un-dilutive financing solution to developing the Citronen project.
NFC is well advanced with the review, re-costing and preparation of the feasibility study report into a Chinese format as required by the Chinese banking sector.
Appointment of engineers
An Australian engineering contracting group, CPC Project Design, has been appointed to assist Ironbark working with NFC on the Citronen project.
CPC work at the study/FEED stage and can proceed through to project implementation with detail design for construction.
Shipping update
Ironbark is progressing work with shipping advisors with regard to the optimal shipping leasing options available.
Ironbark recognises that shipping represents a substantial operational cost and is looking at reducing these through a variety of solutions.
Additional financing
In addition to financing through the NFC assistance, Ironbark is in discussions with major international banking groups and corporate advisors to provided overall banking advice and assistance.
In particular the projects location in Europe makes it a candidate for European Export Credit Agency (ECA) financing funding.
Citronen: An undervalued project
Citronen rates as one of the world’s largest credible zinc development projects at an advanced post-feasibility stage.
In April 2013, Citronen’s feasibility report forecast a pre-tax net present value to the project of US$609 million.
With over 3.6 million tonnes of contained zinc in-ground and market capitalisation of $50 million - Ironbark presents as well undervalued.
Ironbark has been in discussions with several broking institutions and fund managers seeking further coverage and research to improve the market understanding of the Citronen project.
Ironbark considers that Citronen represents a compelling investment exposure to zinc, which has zinc stockpiles at 10 year lows and continuing to fall, driving a strong zinc price.