By: Tomas Ronolski - AllPennyStocks.com News

Tuesday, August 29, 2017

Last week, zinc prices hit a 10-year high on the back of global demand continuing to increase, creating concerns about a shortfall in supply in the future.  Analysts expect upward pressure to remain on prices going forward.

With that backdrop, Vancouver’s Zinc One Resources Inc. (TSX-Venture:Z) (OTCPK:ZZZOF) is taking the steps to be a producer in the future, putting a plan in effect late last year to acquire zinc projects in mining-friendly jurisdictions with the potential to be brought into production in the near-term.  The first step in executing the strategy was acquiring Forrester Metals in June, bringing the Bongará Zinc-Oxide Project in Peru into its portfolio.  The project used to be comprised of two, separate, but adjacent assets, the Bongará Zinc-Oxide mine and the Charlotte Bongará Zinc-Oxide Project, which Zinc One immediately consolidated into one project by exercising options on each.

The lion’s share of exploration has been conducted on the 8,000-hectare mine since its discovery in 1974, which has confirmed the presence of high-grade zinc.  Across 2007-2008, zinc oxides were mined grading higher than 20% zinc, putting it amongst the elite mines in the world with respect to grade.  The global financial fallout known as the Great Recession in 2008-2009 forced the mine to be shuttered due to demand shriveling up.

Shuttered by no means implies void, with a non-NI 43-101 compliant resource estimate in 2011 showing 1.01 million tonnes Measured and Indicated at a whopping 21.61% zinc and about 210,000 tonnes Inferred at 21.18% zinc.  These resources are mostly confined to a three-kilometer strike that has been the subject of advanced exploration and remains open.  Limited work outside that epicenter of work suggest the high-grade zinc trend continues, likely into the neighboring 3,115-hectare Charlotte project, as more than 8,300 meters of drilling have made compelling intersects grading up to 29.7% zinc.

On Thursday, the company got some good news for progressing Bongará, garnering approval from the Peru Ministry of Energy and Mines to the request to suspend the closure of the Bongará Zinc-Oxide mine.  The green light puts Zinc One in motion towards initiating exploration activity at the project.

Namely, the approval allows Zinc One to use the current Environmental Impact Assessment attached to the project for permitting now and in the future.  The company plans to finish updating the environmental baseline study for the EIA and submit an application for an initial drill program by week’s end and anticipates that drilling and other exploratory work will begin during September.

Looking ahead, Zinc One is putting its full focus on Bongará (and Charlotte Bongará), saying it has not only retained two firms for preparing a Preliminary Economic Assessment for the project, but also isn’t expending resources on the Crackingstone Uranium Property in its portfolio, returning that property to the optionor.

After hitting a high of 90 cents in February, shares of V have pulled back, including hitting a low of 42 cents in July.  Interest seems to be picking up again from those levels, with the stock edging higher since the low, currently trading around 48 cents and looking to make an important technical move by breaking over its 50-day moving average.

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