The company noted that the overall drill program is about 30% complete, with 2,000 metres (m) having been drilled in the 2020 program that is currently targeting extensions of the zinc zone indicated resources at the West and South areas, the portions of the resource with the greatest thickness and the highest grades. Tinka expects to continue drilling until February 2021, when it will take a break to compile data and update the project resource estimations.
Tinka Resources CEO Graham Carman said in a statement: "We are pleased with progress of drilling to date, and we look forward to the results from the first drill holes. The arrival of a third rig will speed up the program, while allowing us to also complete a limited number of geotechnical holes within the framework of our work program and budget."
READ: Tinka Resources looking forward to rigs turning again as it advances one of the largest undeveloped zinc prospects in world
He added: "The sharp move higher in silver [price] is the reason we have been re-emphasizing our silver resources, as Ayawilca has substantial silver in the Zinc Zone and also at our nearby Colqui Silver Zone. A Preliminary Economic Assessment (PEA) completed in July 2019 on the Ayawilca Zinc Zone resulted in an after-tax NPV 8% of US$363 million (using US$1.20/lb zinc and US$18/oz silver) with initial capex of US$262 million, which is modest for a base metal project of this size. Tinka is continuing to evaluate ways to add value to the project through optimization of the PEA, which could eventuate in an even more compelling project on the back of an updated resource in 2021."
Tinka Resources said drilling at Colqui Silver Zone is planned for later in the program to test for extensions of high-grade silver mineralization along the Colquipucro Fault.
The company added that three drill holes have been completed since the program began in October, with three holes in progress. It expects assay results for the first two drill holes by the end of November.
The Ayawilca Zinc Zone (sulphide) contains an estimated 1.8 billion pounds zinc and 5.8 million ounces silver in the Indicated category and 5.6 billion pounds zinc and 25.2 million ounces silver in the Inferred category.
The Colqui Silver Zone (oxide) contains an estimated 14.3 million ounces silver in the Indicated category and 13.2 million ounces silver in the Inferred category, with mineralization starting from surface.
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