Variscan's exploration target brings San Jose Zinc mine restart one step closer

Variscan has highlighted the potential scale and quality of its Novales-Udias zinc-lead project in Spain with the definition of an exploration target.

While no replacement for a formal mineral resource, the exploration target of between 16.5Mt and 34Mt at grades of 6.3% to 9.1% zinc and 1.1% to 1.8% lead provides a hint of the project’s potential to host a mid to large scale, high-grade deposit.

Variscan Mines (ASX:VAR) adds that the target will also set the stage for the estimation of an initially modest but higher confidence resource estimate for the formerly producing San Jose mine.

This confidence has a strong foundation with recent drilling to extend the 168 trend to link with the adjacent La Caseta and Los Caracoles trends within the Central Zone returning results such as 6.1m at 15.6% zinc and 0.8% lead.

Estimating a higher confidence resource will also put the company one step closer towards restarting the mine.

“Defining the Exploration Target delivers on our strategy and is a very significant step towards realising the potential of the opportunity we have at the Novales-Udias project,” managing director Stewart Dickson said.

“The geological potential is very encouraging and typical of Mississippi Valley Type deposits. Our belief in the potential for re-igniting zinc production in Cantabria, northern Spain is strongly affirmed.

“A highly focussed, mineral resource together with a mine restart Concept (Scoping) Study will identify the potential economics and work-streams to support a restart of small-scale mining.”

Potential mine restart to focus on quality

Dickson added that such a plan will focus on value rather than volume and enable the advancement of the larger resource areas to be progressed sustainably supported by future, internal cashflows.

He noted that the project, which includes the San Jose and the Buenahora Licence Area, is well positioned for a restart with access to existing historical underground mine development, granted Mining Licence for the San Jose, infrastructure such as electricity, water and road access along with international airport and port facilities in Santander.

Novales-Udias is also located just 100km from Glencore’s San Juan de Nieva, one of the world’s largest zinc smelters, being just 100km to the west.

Comparison and future plans

The exploration target for the project compares well with other ASX zinc plays being of higher potential tonnage than most of the smaller projects while having top zinc grades that rank in the top five of the projects compared.

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Variscan adds that the nearby Reocín Mine, which lies in the same geological unit less than 10km east of San Jose, had a reported Resource of 62Mt at 8.7% zinc and 1.0% lead.

These grades are just below the upper grades in the Exploration Target and provide additional confidence that the grades reported are typical for these types of deposit in this region.

The company plans to carry out targeted drilling to infill existing lenses and commence the preparation of a JORC resource estimate for San Jose while starting the development of a Scoping Study.

This article was developed in collaboration with Variscan Mines, a Stockhead advertiser at the time of publishing

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.