It is reported that China Minmetals Australian subsidiary is finalizing plans for a new USD 700 million zinc mine in Queensland in a sign of confidence in the long-term fundamentals of the market.

Minerals and Metals Group released its environmental impact statement on the proposed Dugald River project, which could be put to the company's board for final sign-off in the next few months, if all the approvals for the operation are received.

It is expected that Dugald River, in northwest Queensland, will produce concentrates containing about 200,000 tonnes of zinc, 25,000 tonnes of lead and 900,000 ounces of silver a year over a 23 year mine life.

Mr Andrew Michelmore chief executive said "As a result of the impending closure of several major zinc mines over the next few years, we believe the development of Dugald River to be very timely."

MMG's Century mine in Queensland, Australia largest open-pit zinc mine, is scheduled to close around 2015, taking out about 4% a year of the global zinc supply.

Zinc mines in Canada and South America are also scheduled for closure around the same time, meaning more than 1 million tonnes of zinc from a global supply of about 12 million tonnes a year will be taken out of the market by 2015.

(Sourced from www.theaustralian.com.au)