Garimpeiro noted recently that the zinc price was refusing to lay down and die in the opening months of 2019.

Since then, the price has moved higher still to a near 9-month high of $US1.32/lb on supply issue challenges and deficits.

While the likes of Macquarie’s commodities desk says it will be “surprised’” if prices are not lower in 6 months, and “amazed’’ if prices aren’t lower in 12 months, the here and now is that the price strength is good news for the zinc explorers.

They tend to be a lightly valued bunch which gives them strong leverage to exploration success, even if zinc prices were to retreat to the $US1.10/lb long-range price forecast most commodity forecasters have on the galvanizing metal.

ASX-listed White Rock Minerals (ASX:WRM) is a case in point. Even after a bit of a share price spurt this week in response to the news that it had cemented a $30m earn-in joint venture with the $1.07 billion Sandfire (ASX:SFR), WRM has been left to trade at 0.7c for a market value of $11m.

The earn-in deal has been in the works since December last year and involves Sandfire spending $30m in stages to earn a 70% in WRM’s Red Mountain zinc and precious metals project near Fairbanks in central Alaska.

Critically, confirmation that Sandfire has signed up within the three months allocated to a decision being made removes any doubt that it would not get on board. Just as important is confirmation of Sandfire’s minimum $6m expenditure commitment in the first year of the earn-in agreement.

It means the 2019 field season at Red Mountain promises to generate plenty of newsflow at a time when the zinc price remains at elevated levels – for the time being at least – and when potential new supply sources in low-risk jurisdictions are in demand.

The earn-in deal is a prime example of a symbiotic relationship between a junior explorer and a big miner.

WRM does not have the balance sheet to fund the big push that Red Mountain deserves while Sandfire needs to find a replacement for its mainstay DeGrussa copper mine in WA where reserves will run thin in about four years.

Potential ‘barely touched’

Red Mountain is early stage compared stuff with some of the other options Sandfire is working on to provide a replacement to DeGrussa, most notably the Black Butte copper project in the US where permitting approvals are slow.

But the potential for Red Mountain to shape up as a significant project on a 70:30 basis between Sandfire and WRM is clearly there.

It is already home to two high-grade deposits with a combined 9.1mt grading 12.9% zinc equivalent (it gives the precious metals an equivalent zinc value) for 1.1mt of zinc on the same basis. The resource estimate is good enough to rank Red Mountain in the top quartile of undeveloped zinc deposits globally.

But the exploration potential of WRM’s ground package has barely been touched for the last 15 years, with most of the drilling done by a since departed TSX-listed company ahead of WRM acquiring the project two years ago.

The Red Mountain deposits are of the volcanogenic massive sulphide-type (VMS) which are known around the world to occur in clusters. DeGrussa is in the same category, as is Sandfire’s nearby Monty deposit.

It is the potential for more VMS deposits to be discovered in the region that has both WRM and the incoming Sandfire excited. Apart from funding the establishment of a 24-man exploration camp, the $6m exploration budget for 2019 means lots of geophysical targeting and drilling is in store.

It is exciting stuff for a junior with an $11m market cap, remembering that WRM also owns 100% of Mt Carrington gold/silver project in northern NSW. Another symbiotic relationship with a bigger company to get things moving there would not surprise.