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ZincX Resources Provides an Update on the 2020 Akie Exploration Program

Vancouver, British Columbia, Canada –Thursday, July 30, 2020 – ZincX Resources Corp. (“ZincX Resources” or the “Company”, TSX Venture Exchange: ZNX) announces that due to concerns surrounding the COVID-19 pandemic, it has decided to defer the 2020 field  exploration program at the Akie property and instead focus its resources on preparing for the more significant 2021 Akie drill program. 

Due to access constraints and logistical limitations imposed on contractors and the local communities as a result of the Covid-19 pandemic, the Company has determined it could not safely execute its planned exploration program.

The Company continues to be in regular dialogue with strategic partner, Tongling Nonferrous Metals (Tongling), about the successful execution of next season's drill program and looks forward to working closely with them.

The Company will continue to focus on a number of key aspects to ensure a successful 2021 exploration season including; ongoing planning in support of the 2021 drilling program, extension of all pertinent exploration permits, and the continuation of advance targeting efforts on the extensive Kechika Trough tenure holdings.

2021 Drilling Program

The planned 2021 drill program will consist of three holes totalling approximately 2,000 metres of drilling with a primary objective of acquiring mineralised drill core sample material for advanced metallurgical testing. The holes will target specific areas of the deposit to provide sample material representative of the deposit across its strike and width. This material will be used to further investigate the metallurgical response of the mineralisation with a focus on enhancing the recoveries for both zinc and lead into high-grade concentrates; using state-of-the-art metallurgical testing facility at Tongling's laboratories in China.

Representative intervals from the 2020 drill program will be selected from the 3 drill holes. Individual drill hole composites will be generated using half of the diamond drill core. Hanging wall and footwall dilution will be included in each composite in order to simulate mined material. From these individual composites a global composite will be constructed. The other half of the drill core will be submitted for conventional assay as per standard procedure for Akie drilling.

Peeyush Varshney, CEO of the Company, stated: “We remain fully funded and intend to execute our exploration programs at the first opportunity. Our funding partner, Tongling remains committed to completion of the intended drill program on the Akie Property in 2021. The drill program is intended to provide new drill core for advanced metallurgical testing that Tongling plans to conduct at their own testing facility. It is anticipated that senior representatives from Tongling will be on site at the Akie Project during the drill program.”

Advanced Targeting

As plans develop for the 2021 exploration season, the Company will continue its ongoing geological interpretation of the Akie Property andwill continue to develop and enhance the Cardiac Creek deposit model. This work will generate additional expansion targets both along strike and at depth of the deposit as well as evaluate other new and key target areas across the Akie property; including the NW Extension, North Lead Zone, the recently discovered extensive Ag-rich Sitka Zone and the historical South Zinc Anomaly.

Another core objective of the Company has been to maximize and unlock the value of its extensive Kechika Trough tenure holdings which stretch 140 strike-kilometres north of the Akie property. Geological modelling, interpretation and advanced targeting will continue on several key properties such as Mt. Alcock, Yuen North, Bear/Spa, Driftpile South, and Saint utilizing the Company’s massive and growing regional geological database in order to refine existing drill targets and identify new target areas. Thisdatabase represents a wealth of data comprised of  over 40 years of exploration activity within the Kechika Trough. Properties such as Mt. Alcock and Bear/Spa are host to significant mineralisation identified in very limited and shallow historical drilling and are prime targets for future exploration programs with the potential for additional discovery. Properties such as the Thro, Weiss and Kwad are vastly underexplored with little to no exploration activity being conducted despite the presence of prospective stratigraphy.

With the exception of the company’s recent VTEM surveys in 2012 and 2013, and structural satellite interpretation completed in 2017 and 2018, the Company’s Kechika Trough tenure holdings have not had systematic, modern exploration techniques applied to them.   So the potential opportunity to continue to advance these highly prospective claims is compelling.

About Tongling Non-Ferrous Metals Group Co. Ltd.:

Tongling Nonferrous Metals Group Holdings Company Limitedis a state-owned enterprise involved in mining and smelting copper and other non-ferrous metals. It was founded in 1949 in Tongling, Anhui, China and the first mine was put into production in 1952.Over the past 60 years Tongling has grown to a large-scale, diverse, fully integrated mining and smelting enterprise engaged in mining, mineral processing, smelting and refining of copper, lead, zinc, gold, silver and other nonferrous metals. The subsidiary and listed company, Tongling Nonferrous Metals Group Company Limited, was established in 1992 and listed on the main board of the Shenzhen Stock Exchange in 1996.

Tongling has established an extensive economic, technical, and trade network with more than 30 countries and regions around the world. Their products are exported to over 10 countries including Japan, Germany, United States, and Singapore. Tongling’s main products include cathode copper, gold, silver, copper wire, copper strip and copper foil, among others. The high purity cathode copper with the brand name of "Tongguan" is registered with the London Metal Exchange (LME) while the silver ingot with the same brand is registered with the London Bullion Market Association (LBMA). Tongling n also investsin resource exploration and development in many countries such as Canada, Ecuador and Chile.

ZincX Resources previously reported that Mr. Hu Xinfu, Vice-President, Deputy General Manager of Tongling Nonferrous Metals Group Holding Company was appointed to the Board of Directors and sits as an independent director.Mr. Hu Xinfu is in charge of acquisition and exploitation of mineral resources both in domestic China and abroad, and is also responsible for production safety and environmental protection for Tongling.

Tongling has other mining interests outside China; including the Mirador copper project in Ecuador which was acquired in 2010 by the CAN $678 million buyout of TSX listed Corriente Resources. The Tonglingā€led Chinese consortium put the US$1.4 billion Mirador copper mine into production in 2019.

The Akie Zn-Pb-Ag Project

The 100% owned Akie property is situated within the Kechika Trough, the southernmost area of the regionally extensive Paleozoic Selwyn Basin and one of the most prolific sedimentary basins in the world for the occurrence of SEDEX zinc-lead-silver and stratiform barite deposits.

Drilling on the Akie property by ZincX Resources since 2005 has identified a significant body of baritic-zinc-lead SEDEX mineralization known as the Cardiac Creek deposit. The deposit is hosted by siliceous, carbonaceous, fine-grained clastic rocks of the Middle to Late Devonian Gunsteel Formation.

The Company updated the estimate of mineral resources at Cardiac Creek in 2018, as follows:

5% Zinc Cut-Off Grade Contained Metal:
Category Tonnes
(million)
Zn (%) Pb (%) Ag (g/t) Zn (Blbs) Pb (Blbs) Ag (Moz)
Indicated 22.7 8.32 1.61 14.1 4.162 0.804 10.3
Inferred 7.5 7.04 1.24 12.0 1.169 0.205 2.9

The Company announced robust positive results from the 2018 Preliminary Economic Assessment (PEA). The PEA envisages a conventional underground mine and concentrator operation with an average production rate of 4,000 tonnes per day. The mine will have an 18-year life with potential to extend the life-of-mine (LOM) through resource expansion at depth. Key parameters for the PEA are as follows:

Parameter Base Case1
Tonnes Mined 25.8 Mt
Mined Head Grades 7.6% Zn; 1.5% Pb; 13.08 g/t Ag
Tonnes Milled 19.7 Mt
Milled Head Grades (after DMS2 upgrade) 10.0% Zn; 1.9% Pb; 17.17 g/t Ag
Total Payable Metal (LOM) $3,960M3
Initial CAPEX $302.3M including $45.7M contingency
LOM Total CAPEX $617.9M including $58.5M contingency
All-in Total OPEX $102.4 per tonne milled
Pre-Tax NPV7% $649M
Pre-Tax IRR 35%
Pre-Tax Payback 2.6 years
After-Tax NPV7% $401M
After-Tax IRR 27%
After-Tax Payback 3.2 years

1. The base case used metal prices are calculated from the 3 year trailing average coupled with two year forward projection of the average price; and are: US$1.21/lb for zinc, US$1.00/lb for lead and US$16.95 for silver. A CDN$/US$ exchange rate of 0.77 was used. The NPV discount rate is 7%. 2. DMS = dense media separation. 3. All dollar amounts expressed in Canadian dollars.

The PEA is considered preliminary in nature and includes mineral resources, including inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Mineral resources that are not mineral reserves have not yet demonstrated economic viability. Due to the uncertainty that may be attached to mineral resources, it cannot be assumed that all or any part of a mineral resource will be upgraded to mineral reserves. Therefore, there is no certainty that the results concluded in the PEA will be realized.

Kechika Regional Project

In addition to the Akie Project, the Company owns 100% of eight of eleven large, contiguous property blocks that comprise the Kechika Regional Project including the advanced Mt. Alcock prospect. The Kechika Regional Project also includes the Pie, Yuen and Cirque East properties which the Company maintains a significant 49% interest with partners Teck Resources Limited (TSX: TECK.B) and Korea Zinc Co. Ltd holding 51%. These properties collectively extend northwest from the Akie property for approximately 140 kilometres covering the highly prospective Gunsteel Formation shale; the main host rock for known SEDEX zinc-lead-silver deposits in the Kechika Trough of northeastern British Columbia. These projects are located approximately 260 kilometres north northwest of the town of Mackenzie, British Columbia, Canada.

Ken MacDonald P.Geo., Vice President of Exploration for the Company, is the designated Qualified Person as defined by National Instrument 43-101 and is responsible for the technical information contained in this release.Mike Makarenko P.Eng, JDS Energy and Mining, is the designated Qualified Person as defined by National Instrument 43-101 and is responsible for the PEA technical information contained in this release.

The TSX Venture Exchange has neither approved nor disapproved the contents of this press release.

ON BEHALF OF THE BOARD OF DIRECTORS

ZINCX RESOURCES CORP.

“PEEYUSH VARSHNEY”

                                                           

PEEYUSH VARSHNEY, LL.B
CEO & CHAIRMAN

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