Lead Investing News

By Daniella D’Alimonte - Exclusive to LeadInvestingNews

Although the prices of lead and zinc have already fallen substantially, analysts predict they still have further to fall.

As mines continue to increase production of lead and zinc and surplus continues to grow over the next few years, investors can expect the prices to remain on the decline, according to a Reuters survey. Taken by 42 commodity strategists, the survey suggests an even lower year end prediction than was anticipated at the beginning of the year. Current year end estimates of US$2000 are nine per cent lower than those given in January.

The BHP-discovered Cannington mine, located in Queensland, Australia, is testing an underground mine for a possible open-cut operation. Open-cut or open-pit mining is done in a pit or burrow as opposed to tunneling underground to extract metals or minerals.

More will be known by the end of the year but there are positive signs of silver, lead and zinc ore deposits, Cannington mine spokesman Shane Hansen told ABC.

Zinccorp Resources Inc. (TSX: ZN) will enter into the second phase of its drilling program by the end of the month. Located at its Michelle property in central Yukon, Zinccorp already returned a drill interval averaging more than 40 per cent combined zinc-lead in the first phase. Further deposits have been located on the Western part of the property to continue the program.

Apogee Minerals Ltd. also announced drilling results at its Pulacayo deposit in Southern Bolivia. Although the holes were drilled for silver exploration, the other base metals found, including lead and zinc, add to the potential value of the project, David Gower, P.Geo., CEO of Apogee, said in a recent interview.

Neptune Minerals, listed on the London stock exchange, is seeking to mine two inactive seafloor massive sulphide (SMS) deposits on the Rumble II seamount. Located East of Auckland, New Zealand, these high-grade gold, silver, lead, zinc and copper laden deposits were discovered in the last decade by government led research institute, GNS Science.

“The lodging of this first mining license application is an historic achievement for the company as well as the offshore mining industry as it represents a significant step towards the commercial development of SMS resources,” Neptune’s Chief Executive Officer Simon McDonald said on Neptune’s website.

A Gold Hawk Resources Inc. mining dump in Peru is causing concern over the possible contamination of a nearby water supply. The dump, which is used to store the mining by-products from thousands of tons of lead, zinc, arsenic and other metals and minerals, has recently showed signed of fragility and ground displacement.

What we had found were some cracks on the surface as well as some cracks in some of the drainage canals below the tailings area,” said Jason Mercier, director of investor relations for Golf Hawk. “ Those surface things were an indication that there might be a problem in the area.”

The ground displacement, largely due to a saturation level irrigation system, said Mercier, also could have an affect on a main rail line running through Gold Hawk.

“This wouldn’t just effect our mine,” said Mercier, “the railway going would effect a lot of producers in the area.”  The railway transports ore from a number of mines to the east of gold hawk down to the coast.

The Lima government announced a state of emergency on July 18, although Gold Hawk halted mine production at the beginning of May. The state of emergency is in a preventative measureeffort to protect the nearby Rimac River. This river supplies over six million city residents.

Gold Hawk has also released an emergency decree regarding the situation.  “Although we are still in consultation with government officials as to the full impact of the decree, we believe this decree will expedite the required authorizations to implement measures that will minimize the risks to people, the environment and property,” said Ken Drover, President and CEO of Gold Hawk Resources, in the decree.

Those against and in favour of Ballot Measure 4 or the Clean Water Initiative, a proposed Alaskan law to place tougher environmental standards on new mining projects, are finding it hard to reach any consensus.
Supporters don’t believe it will have a substantial negative effect on the mining industry. They claim the main purpose of the initiative was to stop the Pebble Project’s plans for a gold, copper and molybdenum mine at Bristol Bay. They want to protect this area, which is known as the red salmon capital of the world.

However, the industry and its supporters fear it will shut down many projects. The opposing sides even disagree on basic facts about the industry such as the amount of employment it provides and its contributions to the Alaskan economy.

The law will be voted on in the August 26 statewide election.

In a recent Bloomberg report, a cargo ship carrying consignments of lead and zinc was hijacked by Somali pirates off the coast of Africa. The Japanese-owned vessel, which was targeted on international waters, is only part of a growing problem for those sailing near Somali shores. Last year the number of attacks tripled to 31 incidents, according to the International Maritime Bureau.