Hole 163 intercepted two intervals of high-grade zinc mineralisation near the edge of the inferred resource including one of the highest grade intersections drilled so far at South Ayawilca.

In addition, a new style of silver-rich mineralisation with disseminated zinc-lead was intersected deeper in the hole within a down-faulted limestone more than 100m beneath the resource.

"We are excited that new drill holes like 163 continue to intersect exceptional zinc grades. The recently completed PEA shows that the project economics are sensitive to zinc grade, so expansions or upgrading of these higher grade zinc resources will have a positive impact on the project economics in future studies," said Dr Graham Carman.

Drilling is continuing with one rig at South Ayawilca with the aim of expanding and upgrading the high-grade zinc zone defined in the July 2019 preliminary economic assessment (PEA).

"With the discovery of the Lower Silver Zone, we have proven that mineralisation exists within a deeper limestone at South Ayawilca, 100 to 150m beneath the existing resource, open to the west and at depth. The Lower Silver Zone so far consists of disseminated sulphides hosted in strongly altered limestone where the original rock has been almost completely replaced by iron-manganese carbonates, a style of mineralisation and alteration that had previously been encountered only in vein form around the edges of the massive sulphide mineralisation," Carman said.

The Ayawilca PEA estimated initial capex of US$262 million, with an after-tax net present value at of $363 million at an 8% discount and an internal rate of return of 27.1%, for a 21-year mine producing an average annual 101,000 tonnes of zinc recovered in concentrate and 906,000 ounces of silver in a silver-lead concentrate.

Shares in Tinka Resources (TSXV:TK) are trading at C18¢, valuing the company at $48 million.