Drilling helped Boab Metals (ASX:BML) convert a sizeable portion of its 44.9Mt at 4.3% lead equivalent resource (3.2% Pb, 0.5% Zn and 37g/t Ag using a cut-off of 1% Pb) to measured resources, with a 56% or 4Mt increase in the highest category of resource.

That also included an increase in shallow resource tonnes, with Boab’s $12.45 million cash balance giving it plenty of steam to power it’s major Phase V drilling program ahead of the hotly anticipated DFS and final investment decision on Sorby Hills.

According to Boab’s PFS numbers the Sorby Hills project 50km south of Kununurra in the Kimberley region of WA, which is expected to enter production around 2023, would produce 50,000t of lead and 1.5Moz of silver a year for a decade with an NPV of $303m and 1.6 years to pay back its $183m capex.

Boab CEO and Managing Director Simon Noon said the current programs – including drilling, metallurgical testwork and financing discussions – will help Boab maximise value from the project.

“The quarter has seen the company leverage off a significantly de-risked Sorby Hills Mineral Resource Estimate into an exciting Phase V drilling program aimed at high impact opportunities to extract maximum value from the deposit for purposes of the DFS,” he said.

“We look forward to providing results from the Phase V program as they come to hand together with other significant project developments over the coming months as we advance towards a Decision to Mine at Sorby Hills.”

Metallurgical and geotechnical drilling is complete – now onto the fun stuff

With confidence-boosting met and geotech drilling now in the books, the Phase V drilling program at Sorby Hills is centred on extending the known mineralisation.

As much as 3000m of the 4200m program has been completed in 31 holes, including six added to the program on the back of drilling success.

Currently Boab is searching underexplored mineralisation pods, satellite exploration targets, possible extensions of known mineralisation trends and geophysical targets within the Eight Mile Creek tenement south and along strike from Sorby Hills.

It is likely the program will be further extended after a series of wins including:

  • The extension of newly uncovered hydrothermal mineralisation for more than 100m beyond the current deposit at northwest Omega,
  • Confirmation of the Alpha geological model and fault-hosted zinc mineralisation,
  • Extension to mineralisation next to the B-deposit, and
  • New lead and zinc mineralisation in holes 500m from the Omega and Norton deposits at the Wildcat target.

Upcoming drilling will focus on the central Omega deposit, Beta deposit and conceptual targets at the 100 per cent owned Eight Mile Creek prospect.

Testwork and financing discussions ongoing

Boab expects to reveal the results of metallurgical testwork on its concentrate product during the September quarter, with testwork to date “in line with expectations”.

It has shown the potential to improve its concentrate grade and project economics with improved pyrite rejection.

Boab has also been in discussions with commercial banks and continued to engage with Federal Government funding agencies including the Northern Australia Infrastructure Facility (NAIF) and Export Finance Australia (EFA) to secure debt finance for Sorby Hills.

It has also stepped into a community relations void left by the closure of Rio Tinto’s Argyle diamond mine by taking over as the naming rights sponsor of the famous Ord Valley Muster from 2022.

Manbarrum acquisition sets up regional strategy

While Boab’s focus is undoubtedly on bringing Sorby Hills to a Decision to Mine, it has secured a nice second fiddle in the nearby Manbarrum project on the other side of the WA-NT border.

The lead, silver and zinc project 25km to the east of Sorby Hills cost a tidy $500,000 in Boab shares and a 1.25% NSR royalty from Todd River Resources, which Boab can buy back on the completion of a PFS.

Manbarrum importantly contains two granted mining leases and multiple deposits which host JORC resources.

“The strategic acquisition of the Manbarrum Project provides an opportunity to investigate a broader regional production strategy that leverages the clear synergies between the two projects,” the company said.

This article was developed in collaboration with Boab Metals, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.