The last batch of drill results from American Pacific Mining’s (CSE: USGD; US-OTC: USGDF) Palmer copper-zinc project in southeast Alaska returned broad copper and zinc intercepts, finding the deposit’s high-grade core. The company is working to update a 2018 resource on the project next year.

Highlight hole CMR24-181 cut 18 metres at 1.5% copper and 5.4% zinc (4.4% copper equivalent) from 203.6 metres depth. It includes better sections of 6.6 metres at 3.6% copper and 7.7% zinc (7.4% copper equivalent). The company released assays from the seven final holes of this year’s 19-hole 6,036-metre, exploration program on the volcanic massive sulphide-sulphate project.

The infill drilling in Zones 2 and 3 follows the good results from Zone 1 from last year, CEO Warwick Smith said in a Wednesday news release. It also supports the presence of a higher-grade copper core within the larger mineralized envelope,” he said.

Investors seemed little impressed, with the early afternoon trades sending the stock trade C1¢, or 8%, lower at C12¢. It has touched C11¢ and C38.5¢ over the past 12 months and has a market capitalization of C$26.3 million ($18.8m).

Regional map of where Palmer is located. Credit: American Pacific Mining

The company elevated Palmer to flagship status in its portfolio after a Rio Tinto (NYSE: RIO; LSE: RIO; ASX: RIO) subsidiary in February dropped its option to earn into the Madison copper-gold project in Montana.

Palmer, near Juneau, is held in a joint venture managed by Dowa Metals & Mining. Dowa owns Japan’s largest zinc smelter and owns 55% of the project. It funded a successful $20 million resource definition and geotechnical program at Palmer in 2023.

Improved grades

Other results from the South Wall Zone 2-3 and the North Wall Alteration Zone at Palmer confirmed the continuity of mineralization. Notable holes, like CMR24-186, intersected 4.8 metres at 1.4% copper and 9.9% zinc (5.7% copper equivalent) from 371.4 metres depth.

The drilling also looks to support higher zinc concentrations in the upcoming resource update.

“We see higher-grade zinc intersections than previously reported in our 2018 resource estimate,” Smith said.

Palmer has seen over $100 million in total spending by the end of 2023. Palmer hosts a 2018 indicated resource of 4.7 million tonnes grading 1.49% copper, 5.23% zinc, 0.3 gram gold and 30.8 grams silver. It also has 5.3 million inferred tonnes grading 0.96% copper, 5.2% zinc, 0.28 gram gold and 29.2 grams silver.

A 2019 preliminary economic assessment found that the copper-zinc resource at Palmer could support an 11-year mine (plus a two-year pre-production period). It has a post-tax net present value (at a 7% discount) of $266 million and a 21% internal rate of return. That was at 2019 price assumptions of $1.22 per lb. zinc, $2.82 per lb. copper, $16.26 per oz. silver and $1,296 per oz. gold.

Source: MINING.COM – Read More