Contract miner Byrnecut Offshore and Ironbark Zinc have entered a memorandum of understanding to provide the latter with underground mining contract services.
Byrnecut will provide underground mine cost modelling, debt and security holding, and an underground mining fleet for Ironbark’s Greenland-based Citronen zinc project as part of the agreement.
Citronen is one of the world’s largest undeveloped zinc-lead resources with a JORC resource of 132Mt at 4.4 per cent zinc and lead, a 14-year mine life (30-year mining licence) and average annual production of up to 200,000t of zinc.
Ironbark was granted its mining licence by the Greenland Government in late 2016 and in September 2017 updated its initial 2013 feasibility study, revealing a net present value of $US1.03 billion ($1.41 billion), or $US909 million ($1.23 billion) post-tax. Capital costs are estimated at $US514 million.
Ironbark is aiming to reduce the capital cost of the highly prospective project, which recently secured the services of a 30,000-tonne cargo vessel for shipping routes.
Jonathan Downes, managing director of Ironbark said the company was extremely pleased to have secured Byrnecut’s services.
“Byrnecut have the capacity to provide Ironbark with an immediate ‘bolt-on’ underground mining expertise that will assist Ironbark as we move from financing to active mining,” he said.
“While only at an early stage, we consider this a very positive step towards the project’s development and financing.”