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Hannan Metals keen to get the drillbit turning at Kilmurry target as it continues to advance Irish project

Just before Christmas, the Vancouver based metals firm said drilling will begin at Kilmurry during the first quarter once permits are received

drill core
Hannan is a zinc explorer with a focus on Ireland

Hannan Metals Ltd (CVE:HAN) (OTCPK:HANNF) is looking at an exciting year ahead in Ireland as it turns attention to exploring the highly prospective  Kilmurry target at the Clare zinc project.

Just before Christmas, the Vancouver based metals firm said drilling will begin at Kilmurry during the first quarter once permits are received.

The target lies around 9km south of the Kilbricken resource at Clare, which spans 35,000 hectares,  and which (Kilbricken) already boasts a maiden resource of indicated resources of 2.7 million tonnes at 8.8% zinc equivalent. In the lower confidence inferred category, there is 1.7 million tonnes at 8.2% zinc equivalent.

READ: Hannan Metals plans 1Q drilling at Kilmurry zinc target in Ireland

"Kilbricken looks like a secondary target in many ways  from a geological perspective to what we're finding at Kilmurry," CEO Michael Hudson told a recent Proactive Investors interview.

"It is hands down the best geological area that has come out of the last 18 months of work that we've conducted on the project."

And in November last year he said the target was "compelling" as it had all the right ingredients for a major base metal system after the group had carried out seismic work.

The plan is for a low cost program early this year of extending an existing hole deeper once permits have been received.

The move to focus on Kilmurry came after holes "did not hit prospective geological features or visible mineralization" at the Ballyhickey prospect, which lies north of Kilbricken.

Hannan has put many man-hours into exploration at the project. US$30 million has been spent over the past nine years drilling out the Kilbricken resource.

Why work in Ireland?

Ireland is a stable jurisdiction and is ranked number one for zinc per square kilometer in the world and number two for lead. In 2015, it was the world’s 10th largest zinc producing nation with 230,000 tonnes produced.

It is home to the substantial Navan deposit (111 Mt (million tonnes) at 7.9% zinc and 1.9% lead) with an in-situ metal value, if discovered today, of more than US$22 billion.

The country is now poised for the next round of major discoveries, while Hannan is utilizing breakthroughs in seismic survey interpretation to test very prospective basin area on its substantial land position.

The company as Hannan Metals began trading in Toronto two years ago.

Hannan had earlier acquired up all exploration data associated with the Clare  prospecting licenses from Lundin Mining (TSE: LUN) for staggered cash payments totaling US$1mln and a 2% net smelter return royalty.

The Clare licenses are well endowed with mineralization, and contain Ireland’s first copper discovery made at Ballyvergin in 1957.  Zinc became the focus of the area in the mid 1990’s with the discovery of the Milltown project (13.3 metres (m) at 5.8% lead and 10.5% zinc from 45.4 metres).

However, the game changed when a local Irish company, Belmore Resources, drilled 8 kilometres away at Kilbricken, and hit an impressive 10m at 13.8% zinc, 5.5% lead, and 62.8g/t silver from 448.1 metres in their discovery hole.

That single drill hole caught the eye of major zinc explorers and producers, and prompted Lundin Mining to negotiate a deal and take over exploration.

From 2009 and 2012 Lundin Mining completed 278 holes (134,000 meters) of diamond drilling.  To date, drilling has defined two high grade massive sulphide zones over 1,500m strike.

Due to other development projects and the winding down of mining operations at Galmoy, Lundin’s focus started to shift away from Ireland and zinc exploration.

This change of focus created the opportunity for Hannan to step in during 2015.

Successful track record

The team behind Hannan has forged a long and successful record of financing and discovering mineral projects in Europe, including with Mawson Resources Ltd (TSE:MAW) and Leading Edge Materials Ltd (CVE:LEM).

Michael Hudson, CEO,  has spent half of his 25-year career with the world’s largest integrated zinc producer of the time, Pasminco, and has a wealth of zinc exploration and development experience. 

Outlook for zinc

After copper, aluminium and iron, zinc is the most commonly used metal by industry - mainly for galvanizing, to protect iron and steel from rust.

Zinc oxide is also widely used in making many household products such as paints, rubber, cosmetics.

But the price of the  commodity has not been so positive in recent years and it has taken a hit since the trade war kicked off in June and July last year.

But zinc watchers - both analysts and company leaders - reckon there will be an upturn in the short- term.

Quick facts: Hannan Metals Ltd

Price: 0.07 CAD

TSX-V:HAN
Market: TSX-V
Market Cap: $3.69 m
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