Ayawilca Polymetallic Project, Central Peru

The Ayawilca Polymetallic Project, located in central Peru, is a carbonate replacement deposit with economic silver-lead-zinc mineralisation.

The project is 100% by Tinka Resources via its wholly owned subsidiary.

The project consists of three mineral deposits- the largest resource of the property, Ayawilca Zinc Zone (sulphide), a Colquipucro Silver Zone, and a Tin Zone (sulphide).

In March 2015, an independent technical report on the mineral resource estimate of the project was filed.

In November 2016, the Ministry of Energy and Mines in Peru approved the Environmental Impact Assessment (EIA) related to the drilling programme of the project. This was followed by a Preliminary Economic Assessment (PEA) in July 2019. The PEA was followed by a technical report in August 2019.

An updated Preliminary Economic Assessment (PEA) of the project was published in October 2021. According to the PEA, Ayawilca has the potentiality to become one of the largest zinc producers in the world.

ln December 2023, Tinka Resources announced that the PEA will be updated again following the successful 2022-2023 11,000 metre drill programme. The revised PEA will include a processing scenario for both the Ayawilca Zinc Zone and Tin Zone, and updated the mineral resource estimates.

The PEA update is slated to be completed by March 2024.

Ayawilca Project Location and Site Details

The Ayawilca Polymetallic Project is located in the Yanahuanca and San Pedro de Pillao districts and 200km northeast of Lima in the Province of Daniel Alcides Carrion, Department of Pasco in Central Peru.

The polymetallic project is located 40km northwest of the Cerro de Pasco Mine and 100km south of the Antamina Mine.

The project site is accessible via road by travelling 310km north from Lima and crossing the Panamerican Highway to Huaral. This road is followed by a paved road to Oyón and by an all-weather graded and well-maintained road to Yanahuanca.

Huanuco, the capital of the Huanuco Region, is the nearest commercial airport to the site.

Exploration History

From 1920 to 1950, the Colquipucro Silver Zone was subjected to small-scale historical mining.

Before Tinka Resources, the property was explored by Compañia Minera Colquipucro, Cerro de Pasco Corporation and Compañia Minera Buenaventura (Buenaventura).

These companies explored the property for silver through mapping, trenching, rock chip sampling, and limited drilling in the Colquipucro area.

From 1950 to 1954, Compañia Minera Colquipucro conducted mining followed by the optioning of the site to Cerro de Pasco Corporation in 1954 and to Buenaventura in 1960.

Between 1970 and 2005, exploration continued when Buenaventura drilled four holes in the zone and conducted trenching.

The claims held by Buenaventura lapsed in 2005 followed by the new claims staked by Tinka Resources.

Tinka’s exploration programme included geological mapping, soil, rock chip and underground sampling, ground magnetics, etc. including mineral resource estimation.

Tinka Resources discovered the Ayawilca Zinc Zone by conducting a drilling programme in 2012.

Geology and Mineralisation of Ayawilca Polymetallic Project

The project’s geology consists of sedimentary and metasedimentary stratigraphy from the late Proterozoic to Tertiary age.

The oldest rocks which are documented are associated with Devonian age Excelsior Group and consist of phyllite, schist, and other metasedimentary rocks.

The Devonian sediments are overlain by red-bed terrestrial sediments including sandstone, conglomerate, and intercalated mudstone of the Permian to the lower Triassic Mitu Group.

The upper Triassic to lower Jurassic Pucará Group limestone is rich in both zinc and tin. The carbonate rocks of the Pucará Group are overlain by the Goyllarisquizga (Goyllar) Group rocks which are the units of sandstone, siltstone, and mudstone.

The zinc and tin zones of the project are hosted with limestone, dolomite, and calcareous siltstone of the Pucará Group.

Zinc occurs in the form of sulphide impregnations of marmatite, sphalerite, pyrite, pyrrhotite, chlorite, iron carbonate, and magnetite. Other sulphides include galena, arsenopyrite, and chalcopyrite.

The tin mineralization pre-dates the zinc mineralisation and consists of predominantly cassiterite, very minor stannite, pyrrhotite, pyrite, and lesser chalcopyrite, arsenopyrite, and galena.

The Colquipucro Silver Zone has silver mineralisation hosted in quartz sandstones and occurs with iron oxides (goethite and jarosite), and manganese oxides.

Mineral Resource Estimate  

At a Net Smelter Return (NSR) of $123/t, the total indicated mineral resource estimate of the Ayawilca Zinc Zone is 19 metric tonne (Mt) containing 2,990Mlb zinc at a grading of 7.15%, 10.3Moz silver at a grading of 16.8g/t, and 87Mlb lead at a grading of 0.21%.

The total inferred mineral resource estimate of the Ayawilca Zinc Zone at an NSR of $96/t is 47.9Mt containing 5,657Mlb zinc at a grading of 5.36%, 30.7Moz silver at a grading of 20g/t, and 370Mlb lead at a grading of 0.35% lead.

For the Ayawilca Tin Zone, the inferred mineral resources are 8.4Mt containing 189Mlb tin at a grading of 1.02% at an NSR of $103/t.

The total indicated mineral resources of the Colquipucro Silver Oxide Deposit are 7.4Mt containing 14.3Moz silver at a grading of 60g/t.

The total inferred mineral resource estimate of the Colquipucro Silver Oxide Deposit is 8.5Mt containing 13.2Moz silver at a grading of 48g/t.

Mining Methods and Processing of Ore

The deposit is planned to be mined using underground mining methods.

The ores will be processed using the conventional zinc and lead silver flotation processing circuit.

The ores will pass through a conventional primary crushing circuit followed by a semi-autogenous grinding (SAG), secondary ball mill grinding, lead and silver flotation, zinc flotation, thickening of the concentrate, and filtration of the thickened concentrate.

Two concentrates of zinc and lead-silver will be produced by the plant.

Power Transmission and Infrastructure

The project is forecasted to have a power demand of up to 30MW. Actual power requirements will be determined via more detailed studies.

Many alternatives have been assessed for power supply and 220kV Paragsha 2- Vizcarra L-2254 line is the selected alternative. The line is owned by ISA Colombia (REP) and crosses the project area.

The new substations will be built beyond 30km from the nearest existing substation according to the change in regulation.

The power supply will include the tie-in at the sectioning point and development of a new 220kV substation and a transformer.

The infrastructure will include access roads (external and internal), mine and process plant facilities, site accommodation facilities, filtered tailings storage facility, fresh water supply and distribution, and a water treatment plant.

A new 20km road is proposed to be constructed leading to the control gate of the mine at the boundary of the mine.

Contractors Involved

The 2021 PEA of the project was prepared by Mining Plus Peru, SLR Consulting (Canada), Transmin Metallurgical Consultants, and Envis.

The August 2019 technical report was prepared by Amec Foster Wheeler Peru , Transmin Metallurgical Consultants, and Roscoe Postle Associates Inc. (RPA).

In June 2019, the metallurgical test programme was successfully conducted by XPS Consulting and Testwork Services, Ontario under the coordination of Transmin Metallurgical Consultants.

In March 2015, the technical report of the project was prepared by RPA.