Teck Resources will increase zinc production at its Red Dog operation and the company offered an update on recent exploration results in Alaska’s Red Dog District. “We are pleased with the significant improvements in recovery at our Red Dog operations in the last few months and, consequently, production will now exceed previous guidance for the year by approximately 50,000 metric tons (mt),” said Don Lindsay, president and CEO, Teck Resources. “As well, our exploration results at our nearby Aktigiruq deposit show its potential to be one of the best undeveloped zinc deposits in the world.”
Red Dog’s zinc production for 2017 is now expected be in the range of 525,000 mt to 550,000 mt, up from the most recent guidance range of 475,000 mt to 500,000 mt of zinc. The increase in production is due to changes in mine sequencing and improved metallurgical recoveries, enabling higher grade mill feed with a greater percentage of ore from the Qanaiyaq pit in the second half of the year.
Annual zinc production at Red Dog over the next five years is expected to be between 475,000 mt and 550,000 mt of zinc. This assumes completion of a mill upgrade project which is expected to increase average mill throughput by about 15% over the remaining mine life, helping to offset lower grades and harder ore in the Aqqaluk pit. This project has robust economics and is expected to be complete by fourth quarter of 2019 at a capital cost of $110 million. Because the upgrade project will permit lower grade material to be processed, the current mine life, based on existing developed deposits, will remain unchanged through to 2031.
Teck’s regional exploration has focused on a significant high-grade zinc deposit, known as Aktigiruq, for a number of years. Located on 100% Teck owned state claims 12 km northwest of Red Dog operations, Aktigiruq is located adjacent to the Anarraaq deposit.
Current drill hole spacing is not sufficient for a mineral resource estimate, but Teck said its drill data suggests an exploration target for Aktigiruq in the range of 80 million mt to 150 million mt of mineralization at a grade of between 16% combined zinc plus lead and 18% combined zinc plus lead (12% zinc + 4% lead and 14% zinc + 4% lead, respectively). If realized, this would make the Aktigiruq zinc deposit one of the top undeveloped zinc deposits in the world. Past production since 1989 to the end of 2016 for Red Dog Operations is 78.3 million mt at 19.6% zinc and 5.3% lead and Red Dog proven and probable reserves at December 31, 2016 were 50.9 million mt at 15% zinc and 4.2% lead.
The potential quantity and grade of the Aktigiruq exploration target is conceptual in nature. The company continues to explore the Aktigiruq deposit with a 2017 helicopter supported drill program to test internal continuity and lateral extents of the deposit. The $16 million 2017 program includes approximately 18,000 m in 16 to 20 drill holes and is well underway with 10 holes and 9,862 m drilled to the end of August. No analytical results for the 2017 program have been received to date, but visual estimates, according to the company, are consistent with the model's expectations. Teck said the results of this program will be released once all assay results are returned.