District Metals (DMX.V) completed its drill program at Tomtebo in Q4 but the labs are notoriously slow these days and it takes much longer than before to actually receiving the assay results back. In District’s case, it was worth the wait as hole 28 exceeded expectations with 30 meters containing 10.9% zinc-equivalent including 10 meters containing 17% ZnEq.
The image above shows the 10 meters consisted of 12.97% zinc (so unlike some other zinc-equivalent calculations released by other companies, the District zinc-equivalent interval actually consists for just over 76% of zinc).
Hole 28 is important as it confirms the earlier findings in that area as numerous drill holes have already established high-grade zinc mineralization in what should be mineable widths. Just have a look at how nicely the results from holes 24 28 and 32 are tying in with for instance hole 25 which is just slightly deeper (but still above the exploration drift).
While waiting for the lab to release the assay results of the final eleven holes, District Metals spent its time wisely as the company completed borehole electromagnetic surveys. And these surveys will come in very handy to continue to work on the Steffenburgs zone where the EM survey will help to drill some targets at depth. The previous image shows how hole 27 intersected mineralization but the 2.7 meters containing 7.21%ZnEq are not in the same league as the double digit zinc hits. Mind you, 7.21% ZnEq would definitely still be above cutoff grades in this scenario but the electromagnetic survey may help the company to refine its targeting and hopefully find some more thicker and higher grade intervals. The exploration theory now considers hole 27 to have just brushed the outside edge of the sulphide lense.
District was hoping to raise C$3M in December but only raised C$1.8M (which again shows how these ‘best efforts’ raises aren’t that helpful at all) which is slightly disappointing. As of the end of December, District had a positive working capital position of just over C$2.7M of which C$2.6M was held in cash. This should be sufficient to kick off the next drill program (which is expected to start in early April) but District will likely have to fill its treasury again before the summer.
It’s a pity the market is pretty apathetic when it comes to zinc. Despite the very high zinc price and the company’s progress at Tomtebo, it looks like the drill results didn’t generate much excitement, and that’s a pity.
Disclosure: The author has a long position in District Metals. District Metals is a sponsor of the website. Please read our disclaimer.
