Osisko Metals (OM.V) is still applying its methodological approach to further derisk the Pine Point zinc project and earlier this month, the company announced an update on its hydrogeological test program which will help Osisko to figure out the water flow and how this may impact the mine plan.
According to the update, the underground water flow appears to be controlled by faults and fracture zones with little influence related to formational aquifers: the flow is controlled by smaller discontinuities and that’s excellent news. Until now, the mine plan and economic studies were using the approach necessary to deal with an aquifer-related water flow which would require a higher capacity solution for the water flow. However, the preliminary results of the hydrogeological test seem to indicate the mine dewatering plan will be more efficient than anticipated and this further increases the confidence level in reopening the Pine Point zinc mine.
As the company will receive more detailed results from the hydrogeological program, it will also be in a position to update the Preliminary Economic Assessment in the first quarter of next year. Both the capex and opex could be reduced if the water flow could be dealt with in a more efficient way.
Disclosure: The author has a long position in Osisko Metals. Please read our disclaimer.