TSX: NZC $0.090
Zn: $1.18/lb
Pb: $0.86/lb
Ag: $14.87/oz

Summary

NorZinc Ltd. is a development stage company listed on the Toronto Stock Exchange under the symbol "NZC", in the United States on the OTCQB under the symbol "NORZF" and in Germany on the Frankfurt under the symbol "SRS" and is engaged in the business of exploration and development of natural resource properties. NorZinc has an experienced Executive and Board and is headquartered in Vancouver, BC.

Prairie Creek Mine, Northwest Territories

NorZinc aims to bring its 100%-owned Prairie Creek Mine into production at the earliest possible date once financing can be arranged. The mine, situated in the Mackenzie Mountains of the Northwest Territories, has a fascinating history which includes the famous Hunt Brothers' plan to corner the world silver market in the early 1980s. The Prairie Creek project hosts substantial resources of high-grade zinc, lead and silver with the established infrastructure development.

History

NorZinc’s predecessor company, Canadian Zinc Corporation completed a Preliminary Feasibility Study ("2012 PFS") on Prairie Creek in 2012 based on a 5 million tonne reserve and a 1,350 tonnes per day ("tpd") mining rate. An updated PFS ("2016 PFS") was completed in 2016 based on a 7.6 million tonne reserve and 1,350tpd mining rate. This was followed in September 2017 by the completion of a Feasibility Study (“2017 PFS") based on an 8.1 million tonne reserve and a 1,600 tpd mining rate. The 2017 FS increased throughput and production with a minor increase to the capital cost compared with the 2016 PFS. A Technical Report prepared in accordance with National Instrument 43-101 Standards for Disclosure for Mineral Projects disclosing the results of the 2017 FS, was filed in October 2017.

Reserves and Resources

Prairie Creek has a Proven and Probable Mineral Reserve of 8.1 million tonnes averaging 8.6% Zn, 8.1% Pb and 124 g/t Ag (3.6 oz/ton) located in proximity to three underground levels. In addition the Inferred Mineral Resources, which are less well-defined than reserves, were estimated to be 7.0 million tonnes with an undiluted average grade of 11.3% Zn, 7.7% Pb and 166 g/t Ag (4.8 oz/ton) which remain open-ended for future definition drilling.

Economics and Financing

The 2017 FS indicates a base case Pre-Tax Net Present Value (“NPV”) of $344M using an 8% discount rate, with an Internal Rate of Return (“IRR”) of 23.8%, and a post-tax NPV of $188M with an IRR of 18.4%. Corresponding pre-tax and post-tax payback periods from mill start-up are 4.4 and 4.6 years respectively. The Base Case metal price assumptions used in the model are: Zn US$1.10/lb., Pb US$1.00/lb., Ag US$19.00/oz., with a foreign exchange rate of C$1.25=US$1.00. NorZinc has engaged HCF International Advisers to negotiate terms for debt financing for the Prairie Creek Project.

Permitting

Under a Type "A" Water Licence signed in 2013 NorZinc holds all the necessary significant documents for the construction, development and operation of the Prairie Creek Mine based on winter road access to the mine. In 2014 NorZinc decided to commence the process to permit an all season road access to the Prairie Creek Mine to reduce the mine concentrate inventory tied up at the mine, reduce the risk of delivering concentrates to the market and delivering supplies and equipment into the mine, and to enable the consideration of alternative, more environmentally friendly, energy sources.

Development Permits

Prairie Creek received a positive decision on the Environmental Assessment completed by the Mackenzie Valley Environmental Impact Review Board ("Review Board") in December 2011 and in June 2013, the Mackenzie Valley Land and Water Board ("MVLWB") completed its regulatory process for the issue to the Company a Type "A" Water Licence.

This Licence was signed on September 8, 2013 and, in tandem with receiving the necessary permits for winter road access from the MVLWB to cross territorial land, and Parks Canada to cross the Nahanni National Park Reserve, NorZinc holds all the necessary significant documents for the construction, development and operation of the Prairie Creek Mine.

All Season Road Permits

In April 2014, the Company submitted an application to the MVLWB and to Parks Canada for Land Use Permits to permit an All Season Road into the Prairie Creek Mine ("ASR"). Public hearings for the ASR permit took place in April 2017 and final arguments were submitted in June 2017. In September 2017 the Review Board issued its EA Report recommending the approval of the ASR subject to implementation of the measures described in the EA Report. The EA Report was submitted to the Federal Minister of Crown-Indigenous Relations and Northern Affairs for Ministerial review. On October 9, 2018 the Minister, on behalf of the Responsible Ministers, issued a decision adopting the Review Board’s recommendation that the ASR be approved subject to the Review Board’s conditions

The permitting process has now entered the regulatory phase conducted by the MVLWB that will culminate in the road permits being issue by the MVLWB and Parks Canada. These permits will incorporate the recommended mitigation measures included in the EA Report. The regulatory phase is expected to be completed Q3 2019.

Newfoundland Properties

NorZinc controls several land packages in Newfoundland that contain three high-grade zinc-lead-copper-gold-silver volcanogenic massive sulphide deposits, with National Instrument 43-101 compliant resources and excellent potential for expansion. The combined deposits total 4.2 million tonnes of indicated and 1.3 million tonnes of inferred resources. NorZinc acquired the land packages by acquiring Paragon Minerals Corporation and Messina Minerals Inc. in 2012 and 2013, respectively. The packages included three projects hosting Volcanogenic Massive Sulphide ("VMS") deposits with NI 43-101 compliant resources as well as several early stage exploration targets.

The South Tally Pond Project is located in a proven base metal mining district, approximately 40 kilometres south of the past-producing Buchans Mine with historic production of 16.2 million tonnes grading 16.2% Zn, 7.6% Pb, 1.37 g/t Au and 126 g/t Ag; and immediately adjacent to Teck Resources Limited's Duck Pond Mine and mill complex which was placed on care and maintenance in 2016. The South Tally Pond Project includes the Lemarchant deposit with an indicated resource of 2.4 million tonnes of 6.14% zinc, 1.6% lead, 1.22 g/t gold and 64 g/t silver  Additional resources are drill-defined within the Tulks South Project and include the Boomerang and Domino deposit and the Long Lake Project hosts the Long Lake deposit.

In 2016, NorZinc, in collaboration with Buchans Minerals Corporation, agreed to jointly undertake a research program aimed at investigating the technical and economic viability of developing their respective central Newfoundland Zn-Pb-Cu-Ag-Au deposits through a central milling facility. The concept is based on the potential that collectively, the satellite deposits can be economically mined, pre-concentrated, trucked and then milled, simultaneously or sequentially, through a central mill. The metallurgical research study demonstrated that the ore from the Company’s Lemarchant and Boomerang-Domino deposits can be successfully processed in a central mill using a sequential flotation flowsheet, and that selective zinc, lead and copper concentrates at marketable grades can be produced from these deposits.

Our Mission Statement

To bring value to our shareholders through the development of advanced precious and base metals projects.


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