Connemara Mining unveils exciting drill results from Stonepark West

Connemara Mining (LON:CON) this morning unveiled what it described as “exciting” drilling results from the western portion of the Stonepark project in Limerick, Ireland.

The highlights included a 2 metre section with 11.62 per cent zinc and 0.49 per cent lead, a 7.2 metre section at 6.37 per cent zine and 2.17 per cent lead and a 2.4 metre section at 4.47 per cent zinc. The mineralisation was found at depths between 245 metres and 381 metres.

Chairman, John Teeling said: "These are exciting results, which enhance the potential of the Stonepark discovery.” 

Three zones now exist in a triangle between 1.7 kilometres and 2 kilometres apart, which demonstrates the possible size of the system.  

This newly discovered Stonepark West zone is still open and the potential exists to expand the extent of the known mineralisation, said Teeling.  

This supports a developing view that the zinc rich area in Limerick trends southwest from the Xstrata discoveries at Pallas Green south-westwards through and beyond Stonepark, he added.  

Connemara and mining giant Teck, which have a joint venture to develop the area, hold the licences to the southwest.  

Pallas Green is a world-class zinc and lead deposit developed by a former Teeling company Minco (LON:MIO) and industry giant Xstrata (LON:XTA).

The latter has paid US$19.6 million to take full control of the project. Stonepark is a couple of years behind Pallas Green.

And rather than having 25.9 million tonnes at 7.5 per cent zinc, Stonepark has around seven. But there’s bags of potential to expand the project.

Teeling explained: “Recent developments on the Pallas Green discovery, directly adjacent to Stonepark, are positive for Connemara.  

“Xstrata has bought out the minority partner in Pallas Green and announced that they hope to have a major zinc mine, 6,000 tonnes per day, operational by 2017."

Connemara is funded to meet its drilling commitments out to 2013, which may or may not be the point at which it too takes a long hard look at its continued participation. 

The original Stonepark discovery was made in 2007, followed in 2009 by Stonepark North. 

In September the group revealed it intercepted another potential ore-body – sitting at a depth of 200 metres – about 1.7 kilometres south-west of Stonepark.

Irish zinc is usually found in pear-shaped deposits called lobes. And there is every chance it is another lobe. 

Combined these lobes often make up big zinc deposits, and some world’s largest – properties such as Navan, Tynagh and Lisheen - are found in Ireland. 

However there could be an alternative explanation. This is that Stonepark North and West, which sit at the same depth, are connected. 

As Teeling points out this is unlikely. But if it did turn out to be the case then it would indicate a huge deposit of global significance.

It is worth considering also that Xstrata plans go into production without ever finding the sweet spot for Pallas Green.

It is thought the higher grade zinc and lead is found close to the border edge with Stonepark, which suggests again that Connemara and Teck are onto something.

There are a number of ways this could play out with Xstrata and Teck in the mix. But Connemara has a strong hand if Teeling and the team play their cards right. 

Key to this is the right to 25 per cent off all concentrates that come out of Stonepark if it goes into production – which is something which would attract smelters from India and China.

How this would all play out is pure speculation as we stand here today, but this and a right of first refusal to buy out the JV, gives Connemara a lot of leverage for a small company when push finally comes to shove.