Zazu Metals (ZAZ.TO), a relative unknown in the investor world, appears set to be a large part of the supply solution. As the operator of the advanced stage zinc, lead and silver Lik property in NW Alaska, the Company boasts 50% partner Teck (operator of the nearby world-class Red Dog mine) access to purpose built State-owned road and port, no debt and $2 million in the treasury. Zazu's release of a 2014 PEA (Preliminary Economic Assessment) is imminent, which will give hard numbers and likely further confirm the compelling potential -large tonnage, high grade-of this project.
High zinc production costs in China have pushed imports to a 12-month high with Asia sucking up the largest percentage of global zinc demand. Steel production is forecast to increase 3.3% globally to 1.52 billion tonnes in 2014.
Further, while LME(London Metals Exchange) inventories were at a record high at 1.2 million tonnes last summer that number continues to decline and currently sits at roughly 800 million tonnes creating a supply gap that ultimately needs to be filled.
"There are no obvious impediments ahead to put Lik into production," stated Matthew Ford, President of Zazu. "The project has the tonnage, grade and metallurgy to be a mine. It has access to nearby hauling and shipping infrastructure and is in a mining friendly jurisdiction. It has local and governmental support and is well prepared to enter mine permitting."