Citronen

Citronen January 2012 Resource

The Citronen Zinc-Lead Project represents one of the world’s largest undeveloped zinc-lead resources with a resource in excess of 13 billion pounds of contained zinc and lead metal. The project is located in northern Greenland, a self-governed part of the Kingdom of Denmark and has a low level of sovereign risk.

To date in excess of 67,000m of diamond drilling has been completed at the Citronen Project. Citronen is a sedimentary exhalative (SEDEX) deposit- a potentially very large type of deposit. The mineralisation at Citronen starts from surface, is flat lying and is currently open in almost all directions. The deposit is adjacent to a deep water fjord that may provide near mine ship docking and loading opportunities.

The current JORC 2004 compliant resource for Citronen is:

Medium grade resource of:

Category

Mt

Zn%

Pb%

Zn+Pb%

Measured

25.0

5.0

0.5

5.5

Indicated

26.5

5.5

0.5

6.0

Inferred

19.3

4.9

0.4

5.3

Total

70.8

5.2

0.5

5.7

Using Ordinary Kriging interpolation and reported at a 3.5% Zn cut-off

Including a higher grade resource of:

Category

Mt

Zn%

Pb%

Zn+Pb%

Measured

8.9

6.6

0.6

7.2

Indicated

13.7

6.8

0.5

7.3

Inferred

7.3

6.2

0.5

6.6

Total

29.9

6.6

0.6

7.1

Using Ordinary Kriging interpolation and reported at a 5.0% Zn cut-off

For further information relating to the resource estimate, please see the ASX Announcement #132- Resource Upgrade at Citronen on the Investor Relations page.

Citronen Project’s Feasibility Study

In April 2013, Ironbark was pleased to release the results of the Citronen Project’s Feasibility Report, which confirmed the Citronen Project as a globally significant  lead-zinc project.

Highlights of the Feasibility Report included:

  • NPV: US$609  Million (US$354M post tax)
  • IRR: 32.0% (22.2% post tax)
  • Equity Return: 37.9% (Geared NPV after tax)
  • Capital Cost: US$429.3 Million inc contingency (US$484.8M with First Fills)
  • Operating Cost: US$0.59/lb Zn (Payable, Net of by-product credits, Years 1-5, Smelter fees additional US$0.12/lb Zn)
  • Mine Life: 14 years
  • Life of Mine Operating Costs: US$3.42 Billion
  • Life of Mine Revenue: US$5.65 Billion

The Citronen base metals project benefits from the following favourable characteristics:

  • Located in Greenland – low sovereign risk
  • Located adjacent to deep, protected water on the doorstep of Europe and North America
  • Simple, flat and continuous ore zones
  • Open-pit fresh sulphide potential with very low strip ratios to supplement higher grade underground mined mineralisation
  • Long mine life, with resource open to further mineralisation in almost every direction
  • Simple, predominantly underground room and pillar mining operation
  • One of few world class deposits wholly owned by a junior company
  • Production scheduled at a time of many planned zinc mine closures, a shortage of zinc supply and anticipated high zinc prices
  • Ironbark is working with China Nonferrous under a MOU to deliver an EPC fixed price contract and financing for the project

For full details of the results from the Citronen Project’s Feasibility Report, please dowload a copy of the ASX announcement dated 29 April, 2013.

1.1