A recent business trip through Southeast Asia took us to Yi Chang, Shanghai, Guizhou, Beijing, Guangzhou, Seoul, Saigon, and Hanoi.
Every city – big and small – had the same grating soundtrack: construction.
Commercial towers, docks, bridges and warehouses – Southeast Asia is a deafening, dusty explosion of jack-hammers, cranes, gravel trucks, re-bar crews and welders.
After the urban tour, the bucolic Vietnam Island Phu Quoc beckoned.
We booked a flight. The Phu Quoc Chamber of Commerce promised “white sands, tropical waters, snorkeling, squid fishing and complete tranquility.”
Finally: Mekong whiskey. Beach yoga. The dulcet chirping of the White-shouldered Ibis.
Big dreams die big deaths.
This is what awaited us in Phu Quoc.
The world is a construction zone.
If you’re a looking for a way to “play construction” – we recommend zinc – the 4th most widely consumed metal in the world.
Zinc is used in automobiles, electrical components, and household fixtures. But the bulk of the end-use is construction-related.
If you a looking for a zinc play with explosive upside, we recommend Zinc One (Z.V) – which controls two zinc projects in Peru – lying at the end of a 6-kilometer trend of known zinc.
On April 26, 2018, Zinc One (Z.V) confirmed the discovery of high-grade zinc deposit located in the Mina Chica zone at the Bongara Mine Zinc project.
The drill program is targeting several areas of known zinc mineralization. The program revealed “additional high-grade results with substantial vertical thicknesses.”
- MCH18010 – 12.0 metres of 26.6% zinc, from 1.5 metres drill depth
- MCH18013 – 19.8 metres of 46.8% zinc, from 1.9 metres drill depth
- MCH18014 – 49.5 metres of 38.7% zinc, from 7.3 metres drill depth
These results will likely be included in Zinc One’s upcoming resource estimate – highlighting “the upward scalability” of the Bongará Zinc Mine project.
To date, assays for only 18 of 50 holes totaling 2,070 metres drilled at Mina Chica have been reported. The data for the remaining 32 holes will be announced once assays results have been received, checked, and compiled.
“Our drilling results have clearly demonstrated that the high-grade zinc mineralization forms a contiguous body, whose vertical thickness is beyond our previous expectations,” stated Bill Williams, COO of Zinc One, “Zinc mineralization has been encountered in nearly every hole drilled to date and we look forward to reporting the assays from these holes so that the magnitude of the zinc in this deposit can be properly quantified.”
The zinc deposit remains open in certain directions. The spot price of zinc has pulled back a little in the last month, but it’s still on a long-term upward trend.
“New and previously announced results at Mina Chica are substantially adding to our expectations for the potential upscaling of this extremely high-grade zinc deposit,” stated Jim Walchuck, President and CEO of Zinc One, “This is truly a turning point for Zinc One.”
Mina Chica is one of three known near-surface zones along a 1.4-kilometre trend that is being tested by this drill program. At Bongarita all results from the 36 holes drilled have been reported.
A second rig is drilling at Mina Grande Sur. Results from 11 of 75 holes, for a total of 1,509 metres, drilled have been reported to date.
Two weeks ago, Zinc One announced drill results from the Mina Grande Sur and Bongarita zones.
Mina Grande Sur
- MGS18001 – 5.5 metres of 26.1% zinc, starting at 3.0 metres drill depth
- MGS18003 – 4 metres of 32.5% zinc, starting at surface
- MGS18003 – 15 metres of 21.5% zinc, starting at 15.0 metres drill depth
- MGS18004 – 9.1 metres of 43.6% zinc, starting at surface
- MGS18006 – 14.1 metres of 32.8% zinc, starting at surface
- BO18005 – 11.5 metres of 16.0% zinc, starting at surface
- BO18005 – 5.7 metres of 29.2% zinc, starting at 5.8 metres drill depth
- BO18007 – 7.0 metres of 25.3% zinc, starting at surface
We believe there are 9 strong reasons to invest in Zinc One.
- Potential near-term production restart
- Drill-confirmed, exploration potential along 6 km corridor.
- Low risk due to past production
- Mature mining jurisdiction
- Exceptionally high grade, at surface
- Global demand from construction
- Anticipated new resource estimate
- Proven metallurgy
- Accomplished management team.
In a recent interview Walchuck stated, “If we can get tonnage at 21% zinc, that equates to 50,000 tonnes of concentrate per year. Because of the high grades involved, you don’t have to mine a lot get a lot of zinc.”
“It appears that Mina Chica may not be so small after all,” added Zinc One’s COO about the latest drill results.
A year ago, Zinc One was trading at .69.
Despite the geological strength of this project, the “hot money” has been flowing into weed and block-chain – not zinc.
Zinc One is currently trading at .27 with a market cap of $15.5 million.
I don’t blame Zinc One for wrecking my Vietnam island holiday.
And I don’t blame them for laughing.
The roar of a construction site is the sound of zinc demand.
Full Disclosure: Zinc One is an Equity Guru marking client and we own stock.