Mitchell Resources Ltd (CVE:MI) said on Monday it has closed the acquisition of Hannan Metals Ltd, which holds the rights to the Clare zinc-silver-lead-copper prospecting licences (PL) in County Clare, Ireland.
From Tuesday, Mitchell common shares will trade on the TSX Venture Exchange under its new name Hannan Metals Ltd and new trading symbol CVE:HAN.
Flagship is Kilbricken base metal project
Hannan’s flagship is the Kilbricken base metal project, located within the Clare PLs which cover a total area of 32,223 hectares of prospective limestone stratigraphy.
Under an earlier agreement Hannan snapped up all exploration data associated with the Clare prospecting licences from Lundin Mining (TSX: LUN) for staggered cash payments totalling US$1mln and a 2% net smelter return royalty.
Hannan will make additional payments if there is a decision to proceed with mine construction or if a commercial financing for mine construction is negotiated. (See full details by clicking HERE)
The Clare PLs are well endowed with mineralization, and contains Ireland’s first copper discovery made at Ballyvergin in 1957. Zinc became the focus of the area in the mid 1990’s with the discovery of the Milltown project (13.3 metres (m) at 5.8% lead and 10.5% zinc from 45.4 metres).
A game changer
However, the game changed when a local Irish company, Belmore Resources, drilled 8 kilometres away at Kilbricken, and intersected an impressive 10m at 13.8% zinc, 5.5% lead, and 62.8g/t silver from 448.1 metres in their discovery hole.
That single drill hole caught the eye of major zinc explorers and producers, and prompted Lundin Mining to negotiate a deal and take over exploration.
From 2009 and 2012 Lundin Mining completed 278 holes (134,000 meters) of diamond drilling. To date, drilling has defined two high grade massive sulphide zones over 1,500m strike.
Due to other development projects and the winding down of mining operations at Galmoy, Lundin’s focus started to shift away from Ireland and zinc exploration.
This change of focus created the opportunity for Hannan to step in during 2015.
Despite the considerable drilling completed by Lundin, Hannan notes that the prospect is still open along strike, up dip and down dip around the immediate deposit environs and a 40km long trend remains open to explore.
For investors seeking more technical details on the project, the company has filed a NI 43-101 technical report for the Clare Project on www.sedar.com.
Successful track record
Over the last decade, the team behind Hannan has forged a long and successful record of financing and discovering mineral projects in Europe, including with Mawson Resources Ltd (TSE:MAW) and Leading Edge Materials Ltd (CVE:LEM).
Michael Hudson, the incoming chief executive of Hannan, spent half of his 25-year career with the world’s largest integrated zinc producer of the time, Pasminco, and has a wealth of zinc exploration and development experience.
"We are fortunate to have secured a bona fide new zinc discovery in one of the world’s premier exploration and mining zinc terrains.
Now our challenge is expand on the very strong start we have been afforded. We look forward to working with all stakeholders to build our business in Ireland around Kilbricken, and to find and define a large, long-life asset,” said Michael Hudson, Hannan’s incoming chief executive officer.
Mitchell also announced the closing of its private placement financing, issuing 10,486,000 common shares at C$0.075 per common share for gross proceeds of C$786,450. The shares have a hold period expiring on May 7.
A significant portion of the financing was taken up by management; President Nick DeMare acquired 1.34 million shares, Director David Henstridge bought 1.4 million shares and Director Michael Hudson snapped up 2.76 million shares.
It has been stated that Irish base metal ore field is ranked first in the world in terms of zinc discovered per square kilometre, and second in the world with respect to lead. In 2015, Ireland was the world’s 10th largest zinc producing nation with 230,000 tonnes produced.
With the recent surge in the price of zinc, Hannan appears to have timed its entry into this high impact exploration asset well.