- Company Provides Corporate Update
CZN-TSX
CZICF-OTCQB
VANCOUVER,
June 27, 2017
/CNW/ -
Canadian
Zinc
Corporation
(TSX:
CZN;
OTCQB:
CZICF)
("the
Company" or
"Canadian
Zinc")
announces the
results of
its 2017 annual
general
meeting
of
shareholders
held in
Vancouver,
British
Columbia
on June 27, 2017.
Mr. John F.
Kearney,
Chairman and CEO of Canadian Zinc,
provided
shareholders
with an
update on the
Company's
activities,
noting
the considerable progress has been made
this past year in advancing the project towards
production.
During the past twelve months, CZN advanced the Prairie
Creek project on several fronts. The Definitive Feasibility Study,
that will provide the detail needed to obtain financing, is nearing
completion. CZN has engaged financial advisers to arrange debt
financing and the Company is examining various financing options to
secure the necessary capital to put the project into production.
The Environmental Assessment of the all season access road to the
Prairie Creek Mine has entered the final phase and the Mackenzie
Valley Review Board is expected to make its decision during August.
Importantly, all of this progress on the project is being made
against the background of a very positive outlook for metal prices,
especially for zinc but also for lead.
Feasibility Study Nearing Completion
Following the completion of the Prairie Creek 2016
Preliminary Feasibility Study, CZN engaged AMC Mining Consultants
(Canada) Ltd. and Ausenco
Engineering Canada Inc. to complete a Definitive Feasibility Study
to support the project debt financing of the Prairie Creek
Mine.
In addition, the 2016 PFS recommended certain aspects for
further detailed study and identified a number of opportunities for
optimizing and potentially enhancing the project economics,
including a front-end engineering and design phase that would
complete engineering to the stage where the design can be used to
obtain fixed pricing from construction contractors.
As part of this process, Ausenco is undertaking project
development planning services for the Prairie Creek Mine and will
deliver a robust optimized project development plan focused on
making the best possible use of existing infrastructure and
construction materials on site so as to provide a lower cost or
faster time-frame to production for the project.
The project development plan is being undertaken with the
objective of converting it to an Engineering Procurement and
Construction Management ("EPCM") contract at the appropriate
time.
The Definitive Feasibility Study is now nearing
completion, the field work and testing has been finished, various
trade-off studies have been undertaken and the study is now at the
compilation and review stage.
Canadian Zinc expects that the DFS will be completed
within the next six to eight weeks.
Mineral Processing Optimization
As part of the Feasibility Study, CZN engaged SGS Canada
Inc. to undertake further mineral processing optimization testing
on new composite bulk samples obtained from the 2015 underground
drill program at the Prairie Creek Mine.
The principal objectives of the program are to optimize
the proposed mineral processing flow sheet and to simplify the
flotation circuit design, thereby improving the projected metal
recoveries and lowering milling production costs. It is expected
that the new mineral processing testing will lead to improvement in
projected metal recoveries, and the results of this
metallurgical testing program will be incorporated into the
DFS.
Alternative Energy Options
In February 2017, CZN signed
a Memorandum of Understanding with Northwest Territories Power
Corporation to examine the supply of electrical power for the
development and operation of the Prairie Creek Mine.
In the MOU, NTPC and CZN have agreed to evaluate the
integration of other energy alternatives, and specifically
Liquefied Natural Gas, as part of the energy supply for the mine
and thereby reduce the dependency on diesel fuel.
All Season Road Permitting
Over the past ten years Canadian Zinc has successfully
completed six environmental assessments and obtained all the
significant regulatory permits and social licences required to
complete construction and development at the mine site and a winter
access road to allow commencement of mining and milling at Prairie
Creek.
An environmental assessment for the Company's permit
application for use of the access road on an all season basis is
now nearing completion.
The Review Board held Community Hearings in Nahanni Butte April
24th and Fort Simpson
April 25th and Technical Hearings in
Fort Simpson April 26th to 28th. There was strong support
shown for the Prairie Creek Project from both
communities.
With the Hearings completed, closing submissions were made
in early May and the Review Board closed the public record on
June 6th.
CZN is now awaiting the Board's decision, which is
expected during August when the Review Board will issue its Report
of Environmental Assessment and submit the Report to the Minister
of Indigenous and Northern Affairs Canada.
Newfoundland Central Milling Facility Research
Program
Canadian Zinc also owns an extensive mineral land package
in central Newfoundland covering
three large VMS projects with known mineral deposits and excellent
exploration potential, including the South Tally Pond project,
which hosts the Lemarchant deposit; the Tulks South project, which
hosts the Boomerang and Domino deposits and the Hurricane and Tulks
East prospects; and the Long Lake project.
The Company's exploration strategy in Newfoundland is to continue to build on its
existing polymetallic resource base with the aim of developing
either a stand-alone mine, similar to the past-producing mine at
Buchans or the Duck Pond mine, or
a number of smaller deposits that could be developed simultaneously
and processed in a central milling facility.
During 2016, CZN, in collaboration with Buchans Minerals
Corporation, successfully completed a research program
investigating the viability of a central milling facility to
process several volcanogenic massive sulphide base metal deposits
in central Newfoundland.
The metallurgical research program was largely funded by
the Research & Development Corporation of Newfoundland and Labrador through the GeoEXPLORE Industry-led
program.
The metallurgical research study demonstrated that the ore
from the Company's Lemarchant and Boomerang-Domino deposits can be
successfully processed in a central mill using a sequential
flotation flowsheet, and that selective zinc, lead and copper
concentrates at marketable grades can be produced from these
deposits.
The positive results of the research project provide
valuable direction to guide future exploration on the Company's
central Newfoundland deposits and
the conceptual economic modeling provided key information on which
to focus future economic studies and development plans for
advancing the development of these deposits through a centralized
milling facility.
2017 Winter Drilling at
Lemarchant Deposit, South Tally Pond Property
CZN completed a winter 2017 diamond drill program on its
Lemarchant copper-lead-zinc-silver-gold volcanogenic massive
sulphide deposit located on the 100%-owned South Tally Pond project
in central Newfoundland.
Ten drillholes and three drillhole extensions, totaling
3,070 metres were completed at the Lemarchant massive sulphide
deposit. Highlights of the drilling program include
significant massive sulphide mineralization
intersected in drillholes LM17-115 and LM17-116, with assays
of:
LM17-115 : 10.23% zinc, 2.19% lead, 0.78%
copper, 148.4 g/t silver, 2.41 g/t gold over 7.1 m.
LM17-116 : 14.06% zinc, 6.27% lead, 1.88% copper, 382.9
g/t silver, 2.01 g/t gold over 6.0 m.
The drilling successfully extended the Lemarchant
mineralization up to 65 metres up-dip on two sections located 125
metres apart and 25 metres along strike to the south. The vertical
depths of the mineralized drill intercepts range from 130 to 170
metres and remain open for further expansion up-dip and along
strike.
A summer drill program was started this week
to follow up on these successful results and to test other targets
around the Lemarchant deposit.
Outlook
Canadian Zinc's focus for the second half of 2017 will be
to complete the Definitive Feasibility Study and seek the financing
required to begin initial development of the Prairie Creek Project
and advance the Mine towards production.
The DFS is well advanced and will be completed in the
coming weeks.
The all season road environmental assessment is in its
final phase with a decision expected in August.
LME zinc prices averaged US$1.26 per pound in the first quarter of 2017,
an increase of 10% from the previous quarter and up 66% from the
first quarter a year ago and most forecasters are predicting zinc
prices to remain strong for the balance of the year.
Zinc concentrate treatment charges have dropped to
historically low levels. It has been reported that zinc concentrate
annual benchmark treatment charges for 2017 was agreed at
US$172 per tonne without any price
participation, a substantial reduction of approximately
US$100 per tonne from treatment
charges agreed for 2016, with spot treatment charges reported much
lower.
The lead price increased by over 14% since the beginning
of 2017 as LME warehouse stocks decreased.
Demand for lead continues to be driven by lead-acid
batteries. According to Wood Mackenzie 85% of global lead demand is
used to make batteries, mostly for automobiles, demand for which is
growing in countries such as China, Brazil, Argentina and Russia. Renewable technologies such as wind
and solar power have created a need for suitable storage capacity
and, large-scale industrial batteries, which use lead, are in
increasing demand.
The long-term price environment for lead and zinc remains
very positive and, supported by the completion of the DFS, Canadian
Zinc will continue to evaluate all alternatives and possibilities
for raising the senior financing necessary to complete the
development and construction and put the Prairie Creek Mine into
production.
Results
of the Annual
General
Meeting
All of the
director
nominees set
out in the
management
information
circular
dated May 10,
2017 were
unanimously
elected as
directors
by a show of hands, to
serve
until the next
annual
general
meeting
of
shareholders
or until
their
successors are
elected or
appointed.
The detailed
results
of the
proxies
submitted
for the
vote on the
election
of
directors
are as
follows:
|
Votes
For
|
Percentage
of
Votes
For
|
Votes
Withheld
|
Percentage
of
Votes
Withheld
|
John F. Kearney
|
70,668,757
|
94.07%
|
4,454,172
|
5.93%
|
Dave Nickerson
|
74,123,901
|
98.67%
|
999,028
|
1.33%
|
Jean-Charles
Potvin
|
74,084,723
|
98.62%
|
1,038,206
|
1.38%
|
Malcolm
JA Swallow
|
73,876,327
|
98.34%
|
1,246,602
|
1.66%
|
Alan B. Taylor
|
70,711,918
|
94.13%
|
4,411,011
|
5.87%
|
Ian Ward
|
73,911,600
|
98.39%
|
1,211,329
|
1.61%
|
John Warwick
|
74,136,410
|
98.69%
|
986,519
|
1.31%
|
The
shareholders
voted in
favour of
all
matters
brought
before
the Meeting.
The
results
of the other
matters
considered
at the
Meeting
including
the
appointment
of
auditors
are reported
in the
Report of
Voting
Results as
filed on SEDAR
on June 27, 2017.
About Canadian Zinc
Canadian Zinc is a TSX-listed exploration and development
company trading under the symbol "CZN". The Company's key project
is the 100%-owned Prairie Creek Project, a fully permitted,
advanced-staged zinc-lead-silver property, located in the
Northwest Territories. Canadian
Zinc also owns an extensive land package in central Newfoundland.
Qualified Person: Alan Taylor, P.Geo., Vice President of
Exploration, Chief Operating Officer and Director of the Company,
who is a Non-Independent Qualified Person as defined in National
Instrument 43-101 – Standards of Disclosure for Mineral
Projects ("NI 43-101"), has prepared, supervised the
preparation of or reviewed, the parts of this News Release that are
of a scientific or technical nature.
Cautionary Statement – Forward-Looking
Information
This press release contains certain forward-looking
information, including, among other things, the advancement of
mineral properties. This forward looking information includes, or
may be based upon, estimates, forecasts, and statements as to
management's expectations with respect to, among other things, the
completion of transactions, the issue of permits, the size and
quality of mineral resources, future trends for the company,
progress in development of mineral properties, future production
and sales volumes, capital costs, mine production costs, demand and
market outlook for metals, future metal prices and treatment and
refining charges, the outcome of legal proceedings, the timing of
exploration, development and mining activities, acquisition of
shares in other companies and the financial results of the company.
There can be no assurances that such statements will prove to be
accurate and actual results and future events could differ
materially from those anticipated in such statements. Mineral
resources that are not mineral reserves do not have demonstrated
economic viability. Inferred mineral resources are considered too
speculative geologically to have economic considerations applied to
them that would enable them to be categorized as mineral reserves.
There is no certainty that mineral resources will be converted into
mineral reserves.
Cautionary Note to United States
Investors
The United States Securities and Exchange Commission
("SEC") permits U.S. mining companies, in their filings with the
SEC, to disclose only those mineral deposits that a company can
economically and legally extract or produce. We use certain terms
in this press release, such as "measured," "indicated," and
"inferred" "resources," which the SEC guidelines prohibit U.S.
registered companies from including in their filings with the
SEC.
SOURCE Canadian Zinc Corporation