Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

With Zinc Prices and Global Deficit on the Rise, Savvy Mining Companies are Poised to Profit

T.IVN, T.TECK.A, T.HBM, C.PKB

NetworkNewsWire Editorial Coverage

PR Newswire

NEW YORK, May 11, 2017 /PRNewswire/ --

Increasing global demand countered by a worldwide shortage has made zinc a red-hot commodity, and mining companies are racing to cash-in on the shortage. Companies like Kootenay Zinc Corporation (OTC:KTNNF) (CSE:ZNK.CN)  (Kootenay ZincProfile ), Nevsun Resources Ltd. (NYSE: NSU), Ivanhoe Mines LTD. (OTC: IVPAF), Teck Resources Limited (NYSE: TECK) and Hudbay Minerals Inc. (NYSE: HBM) are working to address the world's current zinc shortage and take advantage of the subsequent rise in zinc prices.

The imbalanced market, in part, is fueled by the 2016 shutdown of various zinc mines in China (which is both the world's biggest zinc producer and its biggest zinc consumer) and the dwindling ore supply of major zinc mines. While zinc prices sagged in 2015, the base metal was a top performer out of the 22 raw materials tracked by the Bloomberg Commodity Index. Goldman Sachs the following year called zinc "the bullish exception in the metals space," and predicted that a deeper shortage would send zinc prices as high as $2,500 per metric ton in 2017. Zinc outpaced expectations, however, and as of May 2017, the price of the mineral reached $2,628 per metric ton. It's obvious to see why Jeff Currie, Head of Commodities Research at Goldman Sachs Global, in a Bloomberg interview(1) said zinc is his No. 1 commodities pick for 2017.

So, what does this mean for zinc mining companies throughout the world? It means an opportunity to profit in a huge way, particularly for companies that can find the best zinc deposits with the shortest ramp-up time, or those with the ability to expand their existing zinc reserves.

Among these frontrunners is  Kootenay Zin c Corp o ration  (OT C QB: KTNNF) (CSE:ZNK) ,a mineral exploration and development company based in Vancouver, BC. Kootenay Zinc is engaged in discovering large-scale sedimentary-exhalative (SEDEX) zinc deposits and is currently focused on its Sully Property which is located just 18 miles from the historic Sullivan Mine. The Sullivan Mine was in operation for approximately 100 years and was one of the world's biggest SEDEX silver, zinc and lead deposits, boasting production that, at today's prices, would be valued at US $49 billion. An exciting factor for Kootenay Zinc is that its Sully Project could be, subject to positive drill data, of similar size to the Legendary Sullivan-an exciting prospect, indeed.

The Sully Project shares geologic features with the Sullivan Mine and the sedimentary rocks hosting the Sullivan Mine are also present at Sully, representing different environments of the same basin. Geological data thus far suggests Kootenay Zinc's Sully Project share the same stratigraphic level at which the Sullivan Mine was deposited and appears to coincide with the Sully Project's East gravity anomaly. A subtle lead-zinc soil anomaly may reflect leakage up faults and dispersion through thick till and alluvium from a deposit that is entirely buried, and a Cominco airborne geophysical survey has shown two N-S trending magnetic anomalies underground that are up to nearly 2 miles long (1.86) and about 0.62 of a mile apart at the Sully Project. They are near-coincident with the gravity anomalies.

Drilling at the Sully Project, to date has been a near miss which means a strike could be close at hand. Initial surveying at Sully indicated a shallow mass was only narrowly missed by drilling in 2004, and work performed since that time indicated the target was deep. Downhole temperature and magnetic field readings in 2014 indicated the target may have been missed by as little as 100 meters. Geochemical data shows anomalous zinc and lead in the soil which is possible leakage on structures related to the East mass. New gravity data have confirmed and better defined the mass. The next step for Kootenay Zinc is to target this East mass and the company has commenced a drilling program.

Diverse activities being pursued by Nevsun Resources (NYSE: NSU) also include zinc mining operations, with production coming from its Bisha copper-zinc mine in Eritrea. The Bisha Mine is a high-grade open pit mine with nine years of reserve life, and it generates revenues from both zinc and copper concentrates. In the middle portion of 2016, Nevsun Resources expanded its flotation capacity to produce zinc concentrates in addition to copper concentrates from primary ore.

Nevsun Resources earlier this week named Peter G. Kukielski as its new CEO, effective May 12, replacing the retiring Cliff Davis. According to the press release, Kukielski has more than 30 years of diverse international experience in the mining industry which will support the company's strategies to advance its projects.

Ivanhoe Mines  (OTC: IVPAF) is also chasing zinc and has been at work - modernizing and upgrading its Kipushi Mine located in the Central African Copperbelt in preparation to restart commercial production there. Between 1924 and 1993, the Kipushi Project produced about 60 million tonnes grading 11 percent zinc and 7 percent copper. The company is in the midst of a projected two-year construction period with a relatively fast ramp-up to a projected steady-state production of 530,000 tonnes per year of zinc concentrate. A preliminary economic assessment was conducted in May 2016, and a pre-feasibility study is underway to refine the PEA's findings and to optimize the redevelopment schedule of the mine. Both the PEA and PFS are focused on the mining of Kipushi's Big Zinc Deposit which has approximately 10.2 million tonnes of Measured and Indicated Mineral Resources grading 34.9 percent zinc-more than twice the Measured and Indicated Mineral Resources of the world's next-highest-grade zinc project.

Another company positioned to capitalize on the current world zinc shortage is Teck Resources (NYSE: TECK). Teck is the third-largest producer of mined zinc on earth and operates one of the largest fully integrated zinc and lead smelting and refining facilities in the world. The company produces zinc and zinc alloys in slab and jumbo form and is capable of producing about 295,000 tonnes of refined zinc annually. Teck also produces zinc concentrate from its Red Dog Operations, located in Alaska, and from its Pend Oreille Operations, located in Washington State, marketing its zinc concentrate throughout the world. Additionally, the company's concentrate team buys concentrate from other mines which are then processed at Teck's Trail Operations metallurgical complex in British Columbia.

Hudbay Minerals (NYSE: HBM) is also cashing in on the global zinc shortage with output from its 777 Mine and its Lalor Mine. The company operates a zinc plant, located in Flin Flon, Manitoba which produces special high-grade metal from zinc concentrate in three cast shapes. This plant is one of six chief zinc producers in North America and the plant's capacity is expected to be fully utilized by domestic concentrates produced by the 777 and Lalor mines. In the first quarter of 2017, Hudbay said that higher copper and zinc prices enabled the company to increase growth profit over the previous quarter. Its Manitoba operations produced 30,6000 tonnes of zinc as a result of higher zinc grades at 777 and Lalor, as well as higher zinc recoveries.

The broader portrait is that due to the closure of a number of big mines, zinc had hit a record shortage in 2016, with inventories shrinking to 286,000 metric tons, according to the International Lead and Zinc Study Group(2) . As the deficit continues to widen, zinc is trading at its highest level in more than eight years and is forecast to continue its climb. As the value of zinc continues to increase, investors should take a closer look at the companies racing to advance their projects to meet rising demand.

Editorial Sources:

(1) Bloomberg: http://nnw.fm/IYc53

(2) MetalMiner: http://nnw.fm/Ysa29

For more information on Kootenay Zinc visit: Kootenay Zinc (CSE:ZNK) (OTCQB:KTNNF)

About NetworkNewsWire

NetworkNewsWire (NNW) is an information service that provides to users (1) access to our news aggregation and syndication servers, (2) enhanced press release services, and (3) a full array of social communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, NNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. NNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today's market, NNW brings its clients unparalleled visibility, recognition and brand awareness. NNW is where news, content and information converge.

NetworkNewsWire (NNW)
New York, NY
http://www.NetworkNewsWire.com
212.418.1217 Office
Editor@NetworkNewsWire.com

Please see full terms of use and disclaimers on the NetworkNewsWire website applicable to all content provided by NNW, wherever published or re-published: http://NNW.fm/Disclaimer 

DISCLAIMER: NetworkNewsWire (NNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. FN Media Group (FNM) is a third-party publisher and news dissemination service provider, which disseminates electronic information through multiple online media channels. FNM is NOT affiliated with NNW or any company mentioned herein. The commentary, views and opinions expressed in this release by NNW are solely those of NNW and are not shared by and do not reflect in any manner the views or opinions of FNM. Readers of this Article and content agree that they cannot and will not seek to hold liable NNW and FNM for any investment decisions by their readers or subscribers. NNW and FNM and their respective affiliated companies are a news dissemination and financial marketing solutions provider and are NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, NNW, FNM, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer's filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer's securities, including, but not limited to, the complete loss of your investment.

NNW & FNM HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. "Forward-looking statements" describe future expectations, plans, results, or strategies and are generally preceded by words such as "may", "future", "plan" or "planned", "will" or "should", "expected," "anticipates", "draft", "eventually" or "projected". You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company's annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and NNW and FNM undertake no obligation to update such statements.


Media Contact
FN Media Group, LLC
e-mail: editor@financialnewsmedia.com
+1-(954)-345-0611


SOURCE NetworkNewsWire



Get the latest news and updates from Stockhouse on social media

Follow STOCKHOUSE Today