Florida Canyon Zinc Project, Peru

Technical reports indicate that the mine development will require an initial capital of around $213m and a sustaining capital of $81.9m.

In 2022, three major work programmes were undertaken.

This includes finishing an access road to multiple near-by communities, a comprehensive metallurgical testing programme and seeking permission to drill holes in order to expand drilling area for 2023 and beyond.

Florida Canyon Location and Site Details

The Florida Canyon Zinc Project is located in the Shipasbamba District of Bongará Province in the Amazonas Department. The site is in the Eastern Cordillera of Peru in the upper Amazon River Basin, around 245km northeast of Chiclayo and 680km north-northeast of Lima in Peru.

The area’s elevation ranges from 1,800m to approximately 3,200m.

The project’s mineral resources are found in 16 contiguous mining concessions, encompassing approximately 12,600 hectares (ha) of land.

Ownership History

Solitario discovered mineral deposits in the project area in 1994. Before discovery, there had been no historical records of mineral prospecting in the area.

The company staked many of its current mineral resources’ concessions in the property in 1995 and later.

It entered into a joint venture agreement with Cominco, a zinc and copper producer incorporated in Canada, in 1996. However, the agreement was terminated in 2000 making Solitario the sole owner of the project.

Solitario made two joint ventures with Nexa in 2006 for exploration and development.

Minera Bongará, a Peruvian company, was formed in 2006 encompassing the project following the signing of the joint venture agreement between Votorantim Metais-Cajamarquilla (Nexa Resources) and Solitario with shareholding ownership of 61% and 39% respectively.

Nexa can earn 70% ownership in Minera Bongará by funding all project expenditures through to the completion of a feasibility study on the project.

Solitario rebranded itself as Solitario Resources in June 2023.

Florida Canyon Project Geology and Mineralisation

Florida Canyon Zinc Project is situated within Mesozoic carbonate rocks belt of the Upper Triassic to Lower Jurassic Pucará Group and their equivalents.

The Pucará Group is divided into Chambará (base), Aramachay (middle), and Condorsinga (top) formations. The rocks of the Late Triassic-Early Jurassic Pucará Group that contain mineralised bodies are found along the basin of coast.

The Chambará formation has a thickness between 650m and 750m, with Chambará 2 formation hosting the bulk of zinc mineralisation.

The mineralisation, in the form of zinc, lead, and silver, occurs as sulphides within dolomitised zones of the Chambará 2.

Minor minerals are present in limestones, but majority of galena and sphalerite are hosted in dolomite.

Mineral Resource Estimate

According to the updated Mineral Resource Estimate for the Florida Canyon Project in 2021, the mine has total (measured + Indicated) mineral resources of 2.44 million tonnes grading 10.63% zinc, 15.05g/t silver and 1.33% lead.

Additionally, it includes 14.86 million tonnes of Inferred resource grading 9.63% zinc, 11.3g/t silver and 1.26% lead.

Total contained metal (Measured and Indicated) amounts to 0.65 billion pounds of zinc equivalent (Zn-Eq).

Mining and Ore processing

The zinc-lead-silver mine will use different underground mining methods based on the geometry of the mineralised zones.

This will include longhole stoping for steeply dipping zones, mechanised drift-and-fill extraction in shallowly dipping mantos and a conventional room and pillar mining on a checkerboard pattern is expected to be employed for certain specific zones.

The mine may also use cemented paste backfill to increase recovery and stabilise mined-out areas.

A conventional flotation plant comprising three-stage crushing, grinding using ball mill, and differential flotation will be used to process the ore and produce zinc and lead concentrates.

The processing of minerals will be done in a mill with processing capacity of 2,500t/d and production capacity of approximately 287t of zinc concentrate at a grading of 50%, lead at a grading of 1%, and silver at a grading of 0.6g/t.

It will also produce approximately 46t of lead concentrate will be produced at a grading of 50% lead, 8.4g/t silver and 6% zinc.

Once the flotation stage is complete, the two types of concentrates will be transferred to respective thickeners to undergo filtration to approximately 9% moisture.

Subsequently, the products will be loaded onto trucks and transferred to smelters.

Florida Canyon Project Infrastructure

Florida Canyon is a greenfield project with minimal infrastructure currently available.

The infrastructure will include access roads (paved road and dirt road), water management facility, processing plant, mining infrastructure with portals, vent holes, tailings storage facility, security, and camp.

The mine will have associated facilities in the form of fuel storage, water supply and storage, and power supply and distribution.

As there is no power line near the project site, a diesel-powered generator was considered for power supplies.

Energoret, a third-party supplier of power, has proposed a hydropower project located close to the mine. The company has indicated to invest in building a transmission line, connecting the mine site and an onsite substation.

Contractors Involved

The amended technical report for the Florida Canyon Zinc Project, which was published in 2021, was prepared by Gustavson Associates. This included an updated Mineral Resource Estimate for the project.

SRK Consulting (US), a mining engineering firm, prepared the Preliminary Economic Assessment (PEA) for the project.