Osisko Metals reports drill results from Pine Point

Osisko Metals (TSXV: OM; US-OTC: OMZNF) has released drill results from its 100%-owned Pine Point lead-zinc project in the Northwest Territories, about 60 km east of Hay River.  

Highlights from the company’s 15-hole drill program on the Central zone completed this fall included drill hole OM100-20-001, which intersected 8.6 metres grading 11.45% zinc and 3.57% lead starting from 51.8 metres. That hole was drilled in the northern portion of the project’s L65 deposit and, the company said, validated results from a historical drill hole. 

Another drill hole, OM97-20-001, drilled in near-surface mineralisation 1,300 metres to the west of the historic K77 deposit, returned 3 metres grading 2.01% zinc and 2.94% lead from 63 metres and, the company said, suggests the potential to expand mineralisation towards the previously mined K77 deposit.

The company has also recently completed an Induced Polarization (IP) geophysical survey, which identified a chargeability and resistivity target between the Main and North trends measuring 250 metres by 150 metres and extending from surface to an approximate depth of 200 metres.

Robert Wares, Osisko’s chairman and CEO, said the strong IP anomaly in several untested geophysical anomalies “points to the potential for new discoveries of high-grade prismatic deposits.”

A drill rig at Osisko Metals’ historic Pine Point lead-zinc project in the Northwest Territories. Credit: Osisko Metals.

In July, a preliminary economic assessment (PEA) for Pine Point envisioned an underground mine with a life of 10 years, producing 327 million lb. of zinc and 143 million lb. of lead annually at average all-in sustaining costs (AISCs) of US$0.82 per lb. of zinc equivalent.

Initial pre-production capex was pegged at $555 million, and the study estimated an after-tax payback of just under three years. The PEA, which used a lead price of US95¢ per lb. and a zinc price of US$1.15 per lb., forecast an after-tax net present value of $500 million, at an 8% discount rate, and an after-tax internal rate of return of 29.6%.

“The Pine Point project is advancing very well on all fronts in what we believe is the start of a sustained rising zinc commodity market,” Wares said. “We look forward to another season of successful exploration at Pine Point in the new year.” 

At press time in Toronto, Osisko Metals was trading at 48.5¢ per share within a 52-week trading range of 24¢ and 57¢. The company has around 175 million common shares outstanding for an $84.7-million market capitalization.