• 5,099 tonnes of ore mined, with mined grades of 17.5% Zinc, 11.2% Lead and 62.2 g/t Silver

• 2,409 DMT of ore processed, with processed grades of 17.5% Zinc, 11.2% Lead and 62.2 g/t Silver

• Ore stockpiles of 6,599 tonnes available for processing through the Aldama plant

• Aldama plant upgrades in progress to double throughput to 200t/d

Consolidated Zinc Limited (ASX: CZL or “the Company”) is pleased to provide an update on June 2019 production at its Plomosas zinc-lead-silver mine in Mexico.

Ore Production (WMT)

Ore mining

Mining operations are focused on the development of stopes in the Semi Oxide Mineralisation (SOX) available between level 7 and Level 9. The SOX is proving contain nearly double the grade of the Tres Amigos (TA) mineralisation. It is also wider and easier to access with mechanised mining methods and can be mined at a lower cost and at higher rates than the Tres Amigos production areas.

The contact zones on level 7 between the SOX and the waste in the access drive has required additional ground support to ensure safe access to the high-grade zones. During June, production was slowed as the stockpiles of high-grade ore and very high-grade ore have filled available surface area at Plomosas. The stockpiles will be delivered to third party Aldama Concentrator (“Aldama”) for toll treatment over the next few months while the Aldama concentrator is upgraded from 100t/d to 300t/d.

Additional stockpiles of 6,599 tonnes remain at Plomosas mine site awaiting delivery to the Aldama plant.

Ore Processing

Ore mined during the month was delivered to the Aldama concentrator for processing. Aldama milled 2,409 DMT with stockpiles remaining at the end of June of 386 tonnes SOX ore and 320 tonnes of TA ore. The Aldama plant has been optimised for the SOX ore feed, which will be preferentially processed until sufficient TA ore has been stockpiled for an extended batching that material.

During June, the Aldama plant increased processing capacity from 100t/d to 200t/d operations with the installation of additional equipment. Works are continuing to further increase capacity to 300t/day.

CZL, through its subsidiary MLAZ, has assisted with the funding of these upgrades so that the additional capacity is available as quickly as possible to process its ore. To enable MLAZ to do that Eyeon Investments Pty Ltd, an entity related to the Chairman of CZL, Mr Stephen Copulos, has provided an additional short-term unsecured facility of $300,000 to CZL.

The terms of the unsecured facility are a 10% interest rate maturing on 30 September 2019 and the use is for general working capital to assist with the build-up of run of mine and concentrate inventories during the month. In addition, the maturity date of the A$500,000 unsecured loan facilities entities related to CZL directors, Mr Stephen Copulos and Andrew Richards have been extended to 30 September 2019, from 31 July 2019.

The recovery of zinc to zinc concentrate was 68.4%, reflecting the stop-start nature of the expansion works at the Aldama concentrator during the commissioning process.

The SOX grades processed averaged 17.5% Zinc, 11.2% Lead and 62.2 g/t Silver and resulted in a high quality concentrate, free of deleterious elements to smelting and refining.

The Aldama concentrator has been proven to perform and operate efficiently during June and with the establishment of steady state operations in the third quarter CZL anticipates solid cash flows from the Plomosas mine.

For and on behalf of Consolidated Zinc Limited.

ABOUT CONSOLIDATED ZINC

Consolidated Zinc Limited (ASX: CZL) owns 90% of the historic Plomosas Mine, located 120km from Chihuahua City, Chihuahua State, Mexico. Chihuahua State has a strong mining sector with other large base and precious metal projects in operation within the state. Historical mining at Plomosas between 1945 and 1974 extracted over 2 million tonnes of ore grading 22% Zn+Pb and over 80g/t Ag. Only small-scale mining continued to the present day and the mineralised zones remain open at depth and along strike.

The company has recommenced mining at Plomosas and is committed to exploit the potential of the high-grade Zinc, Lead and Silver Mineral Resource through the identification, exploration and exploitation of new zones of mineralisation within and adjacent to the known mineralisation with a view to identify new mineral resources that are exploitable.

Caution Regarding Forward Looking Statements and Forward Looking Information:

This report contains forward looking statements and forward looking information, which are based on assumptions and judgments of management regarding future events and results. Such forward-looking statements and forward-looking information involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any anticipated future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the actual market prices of zinc and lead, the actual results of current exploration, the availability of debt and equity financing, the volatility in global financial markets, the actual results of future mining, processing and development activities, receipt of regulatory approvals as and when required and changes in project parameters as plans continue to be evaluated.

Except as required by law or regulation (including the ASX Listing Rules), Consolidated Zinc undertakes no obligation to provide any additional or updated information whether as a result of new information, future events or results or otherwise. Indications of, and guidance or outlook on, future earnings or financial position or performance are also forward looking statements.

Production Targets:

Production targets referred to in this report are underpinned by estimated Mineral Resources which have been prepared by competent persons in accordance with the requirements of the JORC Code. The production targets in this report are sourced from both Indicated and Inferred Mineral Resources and it should be noted that there is a low geological confidence associated with Inferred Mineral Resources and there is no certainty that further exploration work will result in the determination of Indicated Mineral Resources or that the production target will be realised.

There is a low level of geological confidence associated with Inferred Mineral Resources and there is no certainty that further exploration work will result in the determination of indicated mineral resources or that the production target itself will be realised. The stated production target is based on the Company’s current expectations of future results or events and should not be solely relied upon by investors when making investment decisions. Further evaluation work and appropriate studies are required to establish sufficient confidence that this target will be met.

Original Article: https://www.consolidatedzinc.com.au/wp-content/uploads/2019/07/180719-June-Production-Update-Final-R3.pdf