American Pacific Mining Updates Mineral Resource Estimate for Palmer Project
American Pacific Mining (CSE: USGD) has released an updated mineral resource estimate (MRE) for its 100%-owned Palmer volcanogenic massive sulphide project in southeast Alaska, showcasing a significant increase in contained copper compared to the previous estimate from June 2019.
The updated MRE includes 4.77 million indicated tonnes at 1.69% copper, 5.17% zinc, 0.14% lead, 28.4 g/t silver, 0.29 g/t gold, and 20.6% barite. This translates to 178 million lb. (80,740 tonnes) of copper, 543 million lb. (246,320 tonnes) of zinc, 14.2 million lb. (6,441 tonnes) of lead, 4.4 million oz. (137,000 kg) of silver, 43,900 oz. (1,365 kg) of gold, and 980,400 tonnes of barite. The contained copper count represents a 16% increase (24 million lb./10,886 tonnes) due to a 14% rise in grade.
The inferred category includes 12 million tonnes at 0.57% copper, 3.92% zinc, 0.47% lead, 66.3 g/t silver, 0.33 g/t gold, and 25.5% barite, equating to 151.5 million lb. (68,720 tonnes) of copper, 1.04 billion lb. (471,740 tonnes) of zinc, 125.2 million lb. (56,790 tonnes) of lead, 25.6 million oz. (796,325 kg) of silver, 128,100 oz. (3,984 kg) of gold, and 3.05 million tonnes of barite. Contained copper in this category increased by 22% (28 million lb./12,701 tonnes).
American Pacific CEO Warwick Smith described the updated MRE as a “major project milestone” following the company’s acquisition of 100% ownership of the Palmer project. In late 2024, American Pacific took full control of the project, granting Dowa Metals & Mining, its former joint venture partner with a 55% stake, an option to purchase half of the future zinc concentrate production.
Infill Drilling Success
Dowa, which operates Japan’s largest zinc smelter, has been funding pre-MRE work at the Palmer project, including a $20 million resource definition and geotechnical program in 2023. By the end of 2023, over $100 million had been invested in the project, with an additional $12.8 million earmarked for 2024.
“Infill and geotechnical drilling over the last several years has been successful in increasing our confidence in the known deposits, and we are thrilled to see significant increases in the in-situ copper estimate, in addition to an overall increase in contained tonnes for the project,” Smith said. He added that infill drilling typically retains 75-80% of existing tonnes in updated MREs, but the Palmer project exceeded expectations with a significant increase.
The new resource estimate was based on a database of 284 diamond drill holes totaling 96,485 meters, with 241 holes (82,132 meters) located within the mineralized boundaries used for the MRE. Mineralization was defined in three main domains: the South Wall (SW) and RW domains (Palmer deposit) and the AG domains (AG deposit).
The Palmer and AG deposits underpin the project’s 2019 preliminary economic assessment, which estimated an 11-year mine life (plus a two-year pre-production period) for the copper-zinc resource. The assessment found a post-tax net present value (NPV) of $266 million (USD) at a 7% discount rate and a 21% internal rate of return (IRR).
Shares of American Pacific Mining rose 2.3% as of 11:30 a.m. ET, trading at C$0.22 apiece, with a market capitalization of approximately C$47.4 million ($35.4 million USD).
