Categories: Base Metals
Topics: General Base Metals

Hannan Metals (TSX-V: HAN) CEO Michael Hudson Eyes Resource Expansion with 20,000 Meter Drill Program at Clare Zinc Project

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is Chairman and CEO of Hannan Metals (TSX-V: HAN)(OTC: HANNF), Mr. Michael Hudson. Mike, how are you this morning?

Michael Hudson: I'm great this evening, in Sweden at the moment. Thanks, Gerardo.

Gerardo Del Real: Wonderful. Mike, you have some news out this morning my time, evening your time. Hannan is planning a 20,000 meter drill program. You also provided a thorough first year update for the Clare Zinc Project in Ireland. I'd love for you to go over the details, first on what 2017 and early 2018 accomplished for the company.

Michael Hudson: The way we look at it, Gerardo, is it was a very successful first year for us. We certainly, from a procedural point of view, did everything we said we were going to do. We were going to get out there and do a fair bit of drilling. We're going to run extensive seismic surveys. We're going to go and fill in lots of the gaps in the soil over the large area. We're going to expand the resource through drilling, and then, we're going to go and start looking beyond the resource boundaries for repeats of new mineralized bodies.

We've done all that, and achieved those aims of what that program was meant to achieve. And, it means that we can go into 2018 and into 2019 very confidently with a very big drill program. The project is very well poised with how we've got it and we certainly created a much better project than the one we purchased a year or so ago.

Gerardo Del Real: A little context, you have a market cap of approximately $10 million dollars Canadian. I believe over $30 million dollars has now been spent on the project. Is that correct, Mike?

Michael Hudson: That is absolutely correct, Gerardo.

Gerardo Del Real: Wonderful. Now, you established the maiden resource of 2.7 million tons at 8.8% zinc equivalent. You also have 1.7 million tons in the inferred category at 8.2% zinc equivalent. However, that really is just a first pass resource. 2018 is going to be a big year of exploration. Tell me about the goal for the 20,000 meters of planned drilling.

Michael Hudson: It needs to expand that resource. We're looking for 10 million tons combined in those two categories. You just gave both those numbers, so we see we are sort of 30% to 40% of the way towards meeting that aim of the 10 million tons at 10%. We figure that will go very close to being the potentially economic project, so that's our exploration target. We need to find one or two more mineralized bodies, with two already having been found. There's very good scientific reason to suspect that will occur. We've got 9 kilometers of multiple structures to test in and around the Kilbricken mineralization.

The second phase, and we'll have to find the exact balance to get this right, but I use the analog of Navan, which is Europe's largest base metal mine. It's been mining for 40 years in Ireland and still mining. They ran seismics on it over the last few years, and they've just drilled what looks like the key part, or the key controls on that mineralization, only found through the seismic. We don't want to be mining for 40 years and then find that key parts of the mineralizing system, notwithstanding that Navan is a great ore body, but that just gets better with what they found. We need to look for those big key stretches that we can see in the seismics, target those structures and look for the big key controls on the system if it's there to be found. That's looking in the larger land package. So two phases. One, to expand the resource and continue on that program that we've done. Secondly, look for the big, big winner, if you like.

Gerardo Del Real: Now, you won't be drilling blind in 2018. I say that because there were eight exploration holes that didn't find the fire, but they definitely found smoke. You also completed a ground-breaking 40.6 line kilometer, 2D seismic survey. I know that the dataset from both of those will help aid the target selection process. Can you explain that to people that may not be familiar with that 2D seismic survey that was completed in Ireland?

Michael Hudson: It's a ground-breaking survey for that part of Ireland, and seismic is ground breaking in the hard rock mineral business. We're one of the few companies that has employed it so far, but we'll see more and more coming into the hard rock mining business. As you and I have spoken about before, it's a tried and true method in the oil business. It's basically allowed us to look for the key structures across our whole project with the right stratigraphic position to find the mineralization. It de-risks our drilling, so we don't have to blind drill looking for those structures, which has typically been the way that exploration has progressed in Ireland over the last 40 years. We can be much more specific, use much less dollars ideally to get to that big hit.

Gerardo Del Real: Excellent. Now Mike, the other part of the news release that I want to touch on, and I know it often is ignored, but it is a very, very critical point to make is that you've also commenced locked cycle metallurgical testwork. You can have the highest grade deposit and if the metals are dirty and you can recover them, you have nothing, right? Can you talk about the testwork?

Michael Hudson: Yeah, metallurgy can be the big red flag for a project. Everybody is slightly aware of the metallurgy of zinc and making sure that it's right. Irish deposits typically have had no problems. I mean, very good concentrates that they've produced that are in high demand. Initial work was done by Lundin Mining, who owned the project before us. They did some work to suggest there was no red flags and that there was a very salable concentrate that could be produced, but we're really taking it to the next stage in doing some real world testwork, a locked cycle test that will give us some very hard numbers around those initial predictions. That's due out in Q2 sometime. There's samples going through processing now and we look forward to seeing that data.

Gerardo Del Real: Mike, thank you so much for the update. Is there anything else that you'd like to add?

Michael Hudson: No, we're just really well poised. We've collected all the hard data over the last year and this is now a big drill exercise, and we've got to give it our very, very best shot.

Gerardo Del Real: Looking forward to it, Mike. Thanks again, sir.

Michael Hudson: Thank you, Gerardo.