KZL 0.00% 12.0¢ kagara ltd

zinc over us$800/t;falling supply, page-6

  1. 963 Posts.
    A little more speculative but still worth putting on a watch list Is UCL.

    I know the chart doesn't look good but the MMA's are starting to tighten up.

    Certainly the middle east saga needs to be sorted out but I don't think that will be too far off.

    Cheers Ralph

    Medhiabad Zinc Project

    UNION CAPITAL LIMITED 2002-10-31 ASX-SIGNAL-G

    HOMEX - Brisbane

    +++++++++++++++++++++++++
    Union Capital Limited ("Union") advises that a series of meetings of
    the Medhiabad Zinc Project Joint Venture Management Committee were
    held in Tehran in September 2002. The purpose of the meetings, were
    to resolve a number of matters and to plan the way forward for the
    Joint Venture, prior to the Ministry of Mines and Industry granting
    the Exploitation License.

    Whilst it is Union's clear understanding that all the issues of
    concern to the various parties were resolved during these meetings,
    the Company is still awaiting formal ratification of that from
    Iranian Government partner (IMIDRO) prior to announcing any details.

    The meetings in Tehran coincided with an Australian Trade Mission to
    Iran. During the Trade Mission a meeting was held between the Iranian
    Minister for Mines and Industry Mr Jahangiri and Australian Trade
    Minister Mr Vaile, which was attended by Union's representatives.
    During this meeting Mr Jagangiri expressed Iran's satisfaction with
    their relationship with Union, and a desire for work to re-commence
    on the project as soon as possible.

    Neither increased global terrorism, nor the threat of war in the
    region has had any impact on the project to date. On the positive
    side new foreign investment laws have been recently approved by the
    Iranian cabinet, which Union expect will improve the level of foreign
    investment in Iran, particularly in the private sector. However,
    Union believes that patience will still be required with respect to
    the granting of an Exploitation License at Mehdiabad, because of the
    involvement of a government company as a partner. President Khatami
    is actively encouraging the privatisation of government projects,
    which Union's Iranian advisors feel could be very positive in the
    future for Union and Mehdiabad, once the decree is actually
    implemented.

    The pre-feasibility study completed in 2001 has shown the Mehdiabad
    Deposit to be one of the world's largest undeveloped zinc projects.
    The current "in-ground" metal is 15.7 million tonnes of zinc, 5.1
    million tonnes of lead and 11,100 tonnes of contained silver. The
    deposit is open to both the north and south. The cash operating cost
    of a mine and processing plant is now expected as a result of
    inflation in Iran to be around US$0.23 per lb of zinc produced,
    still making this operation potentially one of the world's lowest
    cost operations.

    Currently, studies are being carried out into refining the process
    flow-sheet for the operation. As part of that process, a recent
    flotation test has been carried out by Metcon Laboratories in Sydney,
    which has produced very encouraging results. The sample tested is a
    drill core composite from the western side of the Mehdiabad deposit.
    The 1 kg sample was crushed to nominally 80% passing 45 microns and
    was subjected to non-optimised lead/zinc flotation conditions.

    The prime conclusion from this sighter test is that the sample was
    amenable selective lead flotation followed by selective zinc
    flotation. With optimisation of the flotation conditions it is
    envisaged that zinc and lead concentrates will be able to be produced
    with relative high zinc and lead recoveries.

    The lead recovery to the lead cleaner concentrate was 84.1% at a
    grade of 59.9% lead. The zinc recovery to the zinc cleaner
    concentrate was 67.2% at a grade of 48.6% zinc. The areas of zinc
    losses were 5.4% to the lead concentrate giving a grade of 1.1% zinc
    in the lead concentrate, which is considered satisfactory and 27.4%
    to the tails stream.

    Further work is underway to analyse the tails stream and investigate
    zinc recovery from the tails.

    Once the Exploitation License is granted then work will commence on
    the feasibility study which Union feels is most likely. At this stage
    the most interest in funding this study is coming from certain parts
    of Europe and the Middle East.


    R Murdoch
    MANAGING DIRECTOR

 
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