Alara Resources Ltd. (ASX:AUQ) announced last Friday a new resource estimate on their 50%-owned Khnaiguiyah Zinc project in Saudi Arabia. The new resource estimate confirms there’s approximately 25 million tonnes of ore with an average grade of just over 4% Zn, for a total of 2.2 billion pounds of zinc.
The resource estimate was upgraded in preparation for the Definitive Feasibility Study, which is due by the end of this year (missing the original deadline of Q1 2012). As the company plans a throughput of 2 million tonnes per annum, we can expect an annual output of approximately 150 million pounds of zinc, of which 75 million pounds are attributable to Alara Resources.
Although we strongly believe in a zinc shortage from 2015 on, we are looking forward to see the final numbers in the DFS to see if the project might be viable at lower zinc prices as well.
Read the full press release here (pdf)
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