As well as achieving record copper, zinc and lead production from its operations in North Queensland, Kagara has had some significant exploration results from prospects in Western Australia.

The full operation of the Thalanga plant contributed greatly to the increased production, which was achieved despite lower zinc and copper prices.

With the Mungana treatment plant expected to come on line in 12 months, good exploration results from the Waterloo base metal resource near Thalanga and the Victoria zinc and copper prospect showing plenty of potential, Kagara is confident its Queensland operations will continue to set production records.

It is the Western Australian prospects, Admiral Bay and Lounge Lizard, that have proved particularly encouraging.

Kagara chairman Kim Robinson says: “Admiral Bay is a very large zinc deposit drilled over a 2.5km section of an 18km strike length and it’s likely to be a company-changing development.

“It has been an exciting time over the last six months, but because of its size it is a longer term project, with production expected in about five years.

“Admiral Bay is returning very significant widths of mineralization grading between 6% lead and 14% zinc in every hole drilled over a 2.5km strike length.

“Our initial target is to outline a resource large enough to sustain a mining operation for at least 10 years at 5 million tonnes per annum. In the longer-term, at Admiral Bay, we believe the 18km of known mineralization could ultimately sustain a 50-year operation.”

Of the Lounge Lizard nickel prospect he says: “Recently we’ve had some exciting results including wide zones of disseminated mineralization underlain by basal massive nickel sulphide zones. We expect to be drilling the strike extensions to Lounge Lizard for a considerable time to come.

“Our objective is to establish sufficient nickel resources to justify a stand alone, high-grade massive nickel sulphide mining operation, or alternatively a large tonnage, low-grade operation capturing wide zones of disseminated mineralization overlying the massive sulphides.”

With the Queensland exploration Kim Robinson says: “The recent announcement of a significant upgrade to the base metal resource at Waterloo has shown that this deposit will be a low cost producer when we begin processing the ore through the Thalanga plant or the Mt Garnet plant. It has only been drilled to a depth of 250 metres and we expect the deposit to grow larger.

“One of the more exciting things we’ve found in recent times is the Victoria mineralization, 5km east of the Mungana deposit, which we’ve started to drill out. We’re discovering very wide zones of high grade zinc and copper mineralization, which we would expect to be feeding into the Mungana treatment plant when that comes on stream. It’s early days for Victoria, but it does have the potential to be larger than anything else we’ve found in the Chillagoe district.

“The objective in North Queensland is to maintain at least a five year mine life at all of our operations, collectively producing 45,000 tonnes of copper and 100,000 tonnes of zinc in concentrate per annum.”

www.kagara.com.au