Lykos Balkan Metals has found significant quantities of gold at its Sinjakovo project in northwestern Bosnia

Terra Balcanica extends its polymetallic footprint with positive drill exploration in its flagship project in Bosnia

Vancouver-based mining exploration company Terra Balcanica Resources Corp. this morning said it had extended yet again its polymetallic footprint after a positive step out drill exploration within its flagship project in Bosnia.

The company announced today that it intersected 284 g/t silver equivalent (Ageq) over 10 meters from surface, including 895 g/t Ageq over 2 meters at Viogor-zanik Project in Bosnia.

This is the company’s fifth successful exploration drill hole within the Cumavici Ridge target, following their discovery of silver and sulfide mineralization between September and October 2022.

Terra Balcanica confirmed that the Cumavici Ridge is a high-grade polymetallic target, with a significant potential for expansion given the shallow nature of the epithermal system detected so far (30-85 m depth).

Terra Balcanica is a polymetallic resources exploration company based in Vancouver, BC, Canada, targeting large-scale mineral systems in the Balkans of southeastern Europe. They have a 90% stake in their main Viogor-Zanik project in eastern Bosnia and fully-owned mineral exploration licenses in Kaludra and Ceovishte in Serbia. The license sites in Serbia are drill-ready and present bonanza-grade Pb-Zn surface geochemistry and multi-ounce gold assays from grab samples.

Why Silver?

From its current price being in the lower 20s per ounce, expert analyst David Morgan sees the silver potentially shooting up to US$50 per oz and even pushing up to US$100 if the US$50 wall is pierced. He said 2023 is a good year for silver and that if prices go up to US$32 or US$33, the trajectory will easily reach the US$50 level.

He attributed the demand growth prospect to the overall tight supply of silver, having a 200 million oz deficit. Morgan clarified that there is no shortage, but it is “difficult to source” silver at present.

“If [silver prices] gets to US$50, I don’t know if it will happen this year, but when it happens, there will be a sell-off for a while . . . and silver will base around US$35, US$40, or US$45 then regather its strength and shoot up through US$50,” Morgan said.

Consecutive Silver Explorations Amid Tight Supply

Terra has been expanding its exploration of the shallow Cumavici corridor at an accelerated pace, having reported multiple drill step out over the last few months.

Technical analyst Clive Maund flagged Terra as one of his top 3 metal stocks, as the company continues showing positive drilling results when it comes to silver. With the company confirming consistent high-grade polymetallic drill intercepts at its flagship project in Bosnia, and the future drilling program in Serbia, Terra Balcanica is set to benefit from increased silver price and demand.

Catalysts

As said earlier this month, Terra Balcanica Resources plans to enter the regional SE European battery metal exploration space. Further details surrounding this development will be released around mid-March.

Other than that, Terra will continue its Phase 2 7,000-meter diamond core drilling program at its flagship Viogor Zanik. This will be divided by target as:

• 4,000m at the Cumavici Ag-Zn-Pb-Au-Sb target – mineral resource definition
• 2,000m at the Brezani Au skarn/porphyry target – preliminary target definition
• 1,000m at the Olovine Mo-Cu porphyry target – preliminary target definition

Ownership and Share Structure

51.6 % of the company’s stock is held by management, insiders, and directors. Among the top investors in management, CEO Dr. Aleksandar Mišković owns 11.7% of Terra’s stock, with 9.21 million shares, according to Reuters. Co-founder and Director Aleksandar Ilić has 12.46%, with 9.0 million shares.

Non-Executive Chairman Giulio Bonifacio has 3.99%, with 2.93 million shares, and Director Brandon Bonifacio M.Eng., MBA is at 2.29%, with 2.15 million shares. An estimated 48.4% is in retail, according to the company, Investor Ideas writes.

Bosnia and Herzegovina: Can Adriatic Metals walk the walk when its Vares silver mine becomes a producer

You could be forgiven for thinking plenty about Adriatic Metals seems a little unfashionable.

Its flagship Vares project is rich in silver, a precious metal commonly boasting the less than complimentary moniker of gold’s ‘poor cousin’.

Vares’ location? Bosnia and Herzegovina, one of the former Yugoslavian states which disintegrated into separate countries around the war that engulfed the region in the 1990s, a process that coined another often unflattering term – Balkanisation.

Yet Adriatic Metals, once backed by copper-gold giant Sandfire Resources before it took a healthy profit on its investment in 2021, is up almost 1600% since its 2018 ASX listing and at a market cap of almost $700 million, has lifted almost 103% in the past 12 months over a period that has seen other stocks fall prey to global economic fears.

It is not uncommon for developers to ride a wave of exuberance and expectation ahead of the hard part of actually running a profitable mine.

But with construction on Vares over 50% done, 15,000t of development ore at surface and miners at the operation already several hundred metres underground ahead of a September 2023 commercial start, ADT managing director Paul Cronin has confidence in both the silver and Bosnian markets.

A new silver age?

On the back a recovery in gold price, silver is up around 30% over the past six months as investor demand for precious metals has recovered from the wear and tear of a string of successive US interest rate rises in 2022.

Now fetching upwards of US$24/oz, Cronin believes the emergence of silver as an industrial metal will ensure demand for the commodity remains strong in the coming years.

“Though it’s not known as a battery metal, it is instrumental in high velocity EV charging, so there’s a lot of silver that use in those charging stations,” Cronin says.

“We’ve also got silver that’s used heavily in photovoltaic production and we’re going to continue to see growth in solar PV installations.

“And it’s amazing, just how many we’re seeing in this part of Europe at the moment where I think the geopolitical issues have really hammered home a complete rethink around energy security.”

Cronin’s assessment is silver will be a metal in its own class, straddling the border of the precious and ‘energy transition metals’ categories. They should have plenty of those given the proliferation also of other metals at Vares.

Silver will account for around a third of ADT’s revenue at current prices, with base metals like zinc and lead making up a third and gold and copper comprising another third of the polymetallic mine’s expected income, derived from underground at the VMS style Rupice deposit.

Silver equivalent production over the first five years of its decade long mine life is expected to total almost 15Moz at an operating cost of US$7.30/oz on capex of US$168 million.

Bosnian renaissance

Mining was prominent in Bosnia before the dissolution of Yugoslavia.

In fact the Veovaca mine, part of Vares, was excavated between 1983 and 1987, producing a zinc, lead and barite concentrate.

But opportunities to progress in mining and other forms of business dwindled in the years after the Balkan War.

Nowadays the bulk of the mineral product in the small nation on the Adriatic Sea is coal, with nine running mines, along with two base metals operations, Cronin says.

After peaking at around 4.5 million in the early 90s, Bosnia’s population has fallen to roughly 3.2 million, a ‘brain drain’ Cronin says the Vares development will help to address.

Vares, where the project is based, was no different. 55km to the north-west of the capital of Sarajevo and an hour’s drive from its airport, Vares is a mountainous and forested area sparsely populated outside of its township.

Once prosperous mining community, boasting iron ore mines, a foundry and a lead & zinc mine, in 1990 the population of Vares was around 22,200 but since the war migration has cut its numbers to 9000.

“Young people in Bosnia aren’t necessarily seeing the opportunities for career development, and moving to other parts of Europe and as a result of that, you’ve seen a steady reduction in the population of Bosnia and Herzegovina over the last 20 years,” he said.

“We’ve implemented a number of programs to try and counter that.

“So we’ve made a very affirmative decision to hire young graduates and to train them, we pay reasonably well for a mining company in Bosnia, but we also offer a lot of benefits, including short term incentive payments that are linked to productivity and performance, offer the opportunity for private health care for our employees and their families, the only employer in Bosnia that offers that.”

At 42km2, ADT holds the largest mining concession granted anywhere in the country.

Bearing in mind the distinction between the countries in scale, that would be tiny by Australian exploration standards.

The community around Vares, Bosnia and the wider West Balkans has seen mining since antiquity, with evidence of mining dating back to Roman and Saxon times, and industrialised operations under the rule of the Austro-Hungarian Empire and the Yugoslavian era.

Whilst there are a number of other base metals operations in Bosnia (and more in Serbia), other than Zijin’s Bor copper mine, ADT says, the mines are small and privately held.

Thirty years ago mineralisation was largely found on surface, meaning while there has been limited exploration at all since the start of the war, there is also a dearth at depth in the northern section of the Tethyan Belt.

Where it has been completed, ADT notes Tier 1 deposits like Reservoir Minerals at Bor, Rio Tinto at Jadar and Adriatic’s own Vares have been uncovered, while the fact little gold assaying was conducted in the Yugoslavian days leaving much ground ripe to be re-examined.

Cronin believes Bosnia and the broader Balkan region has enormous potential for mineral discoveries, but needs “more boots on the ground doing grassroots exploration”.

“What it hasn’t had is a lot of exploration and there does need to be more boots on the ground doing grassroots exploration in this country and I think that will give rise to a lot more mining operations,” he said.

But there are benefits to the location and its history as well. Vares is serviced by a single main road which joins a recently commissioned highway just 25km to the south and a dedicated railway line which will once refurbished provide rail access to the deep water Adriatic port at Ploce in Croatia.

Room to grow

Some of ADT’s recent drilling success has turned heads.

Results last week from the Rupice Northwest discovery, where drilling is expected to extend into 2023, include hits like 45.9m at 701g/t silver equivalent or 22.5% zinc equivalent from 216.1m and 19.4m at 681g/t AgEq or 21.9% ZnEq from 212.6m.

Those results sent ADT’s shares up 4% on the day of reporting, since rising to a record $3.51 yesterday.

Among the eye-catching numbers from the 2021 DFS were the low cost base, IRR of 134% (more than 6 times the investment return hurdle of most major mining operations) and payback period of a little over eight months.

Since then the world has undergone major inflationary challenges. But Cronin says higher operating costs from things such as reagents and diesel price spikes will be balanced out by higher prices for its core commodities.

Exploration success will also bolster the investment case, with Cronin saying ADT does not expect to have to dip back into equity markets like many other companies have to cover capex shortfalls.

“We are working on a new mine plan that is going to basically bring in some some higher grade ores in the earlier years of operation,” he said.

“We’re obviously now seeing the benefits of exploration success, we’re seeing this high grade northern zone that I think will change the economics the project as well in a positive way.

“So I’m confident that when we put out an updated resource statement and updated reserves, the market will probably see that the original valuation that we gave it or ascribed to it as part of the definitive feasibility study is a little bit understated.”

Sensing the shift in deglobalisation around commodities, accelerated by Covid and the invasion of Ukraine by Russia, ADT says it noted when it formed in 2017 its founders noted the trends that would see Europe reindustrialise and scramble to underpin its existing manufacturing base by sourcing primary raw materials from the continent.

It has prioritised closer European smelters as offtakers for its concentrate, a move that will reduce transport related Scope 3 emissions. Around 75% of the Vares product will be smelted in Europe, with zinc con to head to Boliden in Sweden and Trafigura’s Nyrstar operations in the Benelux countries, silver/lead concentrates to Glencore’s smelters in Europe and the balance to China.

Community onside?

Another challenge in that part of the world has been garnering community backing, even with local support for the transformation of energy systems to build more renewable power.

In neighbouring Serbia, Rio Tinto was famously forced to postpone work on its board-approved Jadar lithium mine, the largest source of the battery metal proposed to be developed in Europe, after community opposition saw the government revoke its core permit.

In Vares, Cronin says the people both fondly remember the economic benefits of their mining past while also remembering the pitfalls of the way it was conducted three decades ago, leading locals to hold the company to account “quite properly” on matters of environment, health and infrastructure.

It may not capture hearts and minds as powerfully as the Bosnian national football team did in the young nation’s first World Cup appearance in Brazil in 2014, but with construction already well under way at Vares, Cronin says Adriatic’s experience in Bosnia has been completely different.

“I think in Bosnia there’s a strong mining tradition but the capital and the investment hasn’t been available in the last couple of decades to support that,” Cronin argues.

“I think the government want to see mining again, they want to see mining via be a big contributor to their economy, we’re certainly seeing public statements by the Serbian government along those lines as well, where they want to see mining, contribute 5% of their GDP.

“So I think when you when it comes to election time, there might be a bit of mud throwing here and there and I think Rio Tinto were unfortunate in that, … but I think ultimately, common sense prevails. And the government in Serbia and governments in Bosnia will strongly support mining in the future, particularly as companies like ours demonstrate how it’s done properly”, Stockhead writes.

Bosnia and Herzegovina, Adriatic taps funding deal to progress Vares silver mine

Adriatic Metals has passed the halfway mark on construction of its high-grade Vares silver project in Bosnia & Herzegovina with its financial future secured following draw down of its first US$30m tranche from a $142.5m debt package.

The Balkans-focused, ASX-listed company opened its coffers to the $30m injection via senior secured debt with Orion Resource Partners on Friday as it pursues project completion and first concentrate production by September 2023.

A further $22.5m boost is also imminent pending final security documents and three more $30m tranches are expected be drawn down over the course of 2023.

Construction at Adriatic Metals’ Vares high-grade silver project in Bosnia and Herzegovina is picking up speed

Construction at Adriatic Metals’ Vares high-grade silver project in Bosnia and Herzegovina is picking up speed as the company prepares to bring the project’s namesake underground mine and processing facility online next year. Adriatic says the project is now at the mid-way point and importantly remains on schedule and budget to deliver the first concentrate around September 2023.

The company says the past six months have been a whirlwind of activity with construction around the site’s surface infrastructure gathering pace.

Management states earthworks associated with the project’s Rupice mine are progressing as planned and are at around 56 per cent complete. The backfill pad is about 85 per cent finalised and 45 per cent of the work needed on the stockpile pad excavation has been done. Additionally, all geotechnical drilling for the backfill pad has been wrapped up.

Bosnia and Herzegovina, Discovered a gold deposit near Srebrenica

Silver-zinc and lead ore were found at the Čumavići site, at a depth of 50 meters.

The general director of the company “Drina resurs” from Srebrenica, Aleksandar Mišković, said at the presentation of the results of geological research carried out in the area of ​​this municipality – that gold was discovered at a depth of 80 meters at the Brežani site, reports the Radio-television of Republika Srpska.

Adriatic Metals builds underground mining fleet at Vares silver project

As Adriatic Metals gears up for first concentrate production at its Vares silver project in Bosnia & Herzegovina, it has revealed details of the mining fleet set to carry out work at the underground Rupice mine.

In its latest update, the company said project construction was 45% complete, with decline development progressing well – the lower decline currently being at at 210 m and upper decline at 100 m.

The majority of long-lead items and equipment orders were expected to come in on schedule, however global supply chain disruption has pushed first concentrate production from the end of the June quarter of 2023 into the September quarter, it said.

In the company’s 2021 definitive feasibility study, it shifted focus from a combined open pit and underground operation to an underground-only operation focused on Rupice, highlighting plans to mine 730,000 t/y of ore over a 10-year mine life.

In Adriatic’s most recent update, it highlighted that the fleet of vehicles required for Phase One (decline development) was on site, with delivery of Phase Two and Three vehicles commencing.

Among the fleet on site at Rupice is a Sandvik LH514i LHD, two Sandvik LH517i LHDs, a Cat 950L wheel loader, a Sandvik TH545i truck (second unit arriving in December), an Epiroc Boomer 282 jumbo drill, two Sandvik DD320 jumbos, two Sandvik DS311 rock bolters, two Titan IS26 shotcrete sprayers, three Titan BYM 6.0 underground mixer trucks and a Titan EC2 explosive charger.

Adriatic said the final project cost estimate had increased marginally from $170 million to $173 million, due to increases in engineering costs, plant and electrical equipment, including adjustments based on recent contract awards.

Adriatic Metals PLC has released assay results from exploration drilling at Rupice Northwest

The assay results from nine drill holes confirm the widths and grades intercepted at Rupice Northwest are equivalent to those held within the existing high-grade RMR; continuity between approximately 80 m spaced sections has been established over a strike extent of 250 m.

Drillhole highlights:

Drillholes BR-04-22 and BR-05-22 are located 155 m northwest of RMR. They are respectively drilled up-dip and down-dip of previously reported hole BR-12-21 (24.7 m at 514g/t AgEq), intercept:

•  BR-04-22 – 32.5 m at 657 g/t AgEq, 21.1% ZnEq (78g/t Ag, 10.1% Zn, 4.7% Pb, 0.8g/t Au, 0.3% Cu, 69% BaSO4, 0.1% Sb) from 285.5 m.
  • Including 2 m at 1,331 g/t AgEq, 42.8% ZnEq (170g/t Ag, 19.7% Zn, 18.5% Pb, 0.5g/t Au, 1.2% Cu, 40% BaSO4, 0.2% Sb) from 315.0 m.
• BR-05-22 – 4.1 m at 197 g/t AgEq, 6.3% ZnEq (51g/t Ag, 1.8% Zn, 1.9% Pb, 0.2 g/t Au, 0.1% Cu, 4% BaSO4, 0.4% Sb) from 214.1 m.

Drillholes BR-06-22 and BR-07-22, located 175 m northwest of RMR and drilled up-dip of the currently reported hole BR-04-22 (32.5 m at 657 g/t AgEq), intercepted:

• BR-06-22 – 18 m at 968 g/t AgEq, 31.1% ZnEq (242 g/t Ag, 12.3% Zn, 8.4% Pb, 1.4 g/t Au, 0.6% Cu, 42% BaSO4, 0.1% Sb) from 245.2 m.
  • including 3.8 m at 1,848 g/t AgEq, 59.4% ZnEq (763 g/t Ag, 16.3% Zn, 15.2% Pb, 3.6g/t Au, 0.6% Cu, 31% BaSO4, 0.1% Sb) from 245.2 m.
  • Including 6.2 m at 1,174 g/t AgEq, 37.7% ZnEq (169 g/t Ag, 19% Zn, 11.1% Pb, 1.2 g/t Au, 1.0% Cu, 42% BaSO4, 0.1% Sb) from 254.0 m.
• BR-06-22 – 2.3 m at 514 g/t AgEq, 16.5% ZnEq (139 g/t Ag, 2.4% Zn, 2.8% Pb, 1.3 g/t Au, 0.5% Cu, 3% BaSO4, 1.1% Sb) from 148.3 m.

Drilling of Rupice Northwest will continue to the end of 2022 with the objective of generating a maiden inferred resource estimate for Rupice Northwest in 1Q23.

Paul Cronin, Adriatic’s Managing Director and CEO, commented:

“The highly successful drilling campaign at Rupice Northwest further underpins Adriatic’s strategy to increase the life of mine of Rupice to at least twenty years. The most encouraging aspect of the drilling results has been the consistency of not only the depths and widths of Rupice Northwest, but also the grades which are consistent with the reserve defined in the main Rupice orebody, Global Mining Review reports.

Bosnia and Herzegovina: Serb Republic to award iron ore mining concesssion

The government of Bosnia’s Serb Republic said it plans to award a concession contract for iron ore mining near the own of Ljubija to ArcelorMittal Prijedor.

Under the planned agreement, ArcelorMittal Prijedor will mine 3 million tonnes of iron ore from a deposit located near Ljubija, the Serb Republic government said in a statement on Thursday.

The project will employ about 100 people.

In the coming period, the government will define the obligations of the concessionaire in the agreement before signing it with ArcelorMittal Prijedor.

ArcelorMittal Prijedor and the government of the Serb Republic entity signed a memorandum of cooperation in the project on December 31, 2021.

ArcelorMittal Prijedor was established in 2004 as a joint venture between multinational steel and mining company ArcelorMittal with a 51% stake and local mining company RZR Ljubija with a 49% stake. ArcelorMittal also owns a steel plant in Zenica, located in Bosnia’s other entity, the Federation.

The Serb Republic and the Federation are two autonomous entities that form Bosnia and Herzegovina.

For the Vares silver project lower costs

An updated definitive feasibility study (DFS) for the Vares silver project, in Bosnia & Herzegovina, has seen capital costs decline while the project’s net present value (NPV) and internal rate of return (IRR) have increased.

ASX-listed Adriatic Metals this week reported that an updated capital cost estimate for the Vares silver project had estimated that the project would require a $168-million investment, compared with the $173-million estimated in the 2020 DFS

The updated DFS has also increased the project’s post tax NPV from the $1.04-billion reported in the original DFS to $1.06-billion, while the IRR has increased from 113% to 134%.

The pay-back period has declined from 1.2 years to 0.7 years, while the project’s all-in sustaining cost estimates have declined from $9.70/oz to $7.30/oz of silver

“The completion of the 2021 DFS is a major milestone for the company, and clearly demonstrates the exceptional potential of the Vares silver project”, said Adriatic MD and CEO Paul Cronin.

“Project delivery and execution risks have been substantially reduced through the simplification of the process flowsheet and initial capital costs lowered against the backdrop of inflationary construction costs, whilst improving the overall project economics. In the design of this project, environmental and economic sustainability have been at the core of our thinking, shaping the project to ensure that its economic and environmental benefits extend well beyond the current mine life, and provide a perpetual benefit to our local community in Vares and indeed, to the BiH economy”.

Cronin said that the company’s focus would now be on finalising project financing, which is well advanced, and concurrently starting constructio,n while continuing to look for marginal improvements in metallurgical recovery, and capital and operating costs.

“Additionally, we have commenced a study to expand the renewable energy production we have at the Vares processing plant, and [to] augment that capacity to ensure that the Vares silver project reduces its carbon emissions significantly, soon after the commencement of commercial production. As demonstrated in our recent exploration results, we are confident that we can expand the resources and reserves at the Vares project and look forward to working with the Vares community for decades to come, jointly demonstrating the benefits of mining operations in a European context”.

Source: Mining Weekly