Further high-grade hits identified by Prospect Resources at Arcadia
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Prospect Resources (ASX: PSC) has released assay results from drilling at its Arcadia lithium project. These have proved to be very promising, representing a continuation of the high grade nature of mineralisation previously identified.
The company now has assay results from 20 diamond drill holes and 32 RC drill holes, all of which will be included in the company’s maiden JORC reportable Mineral Resource planned for release by the end of October 2016.
Given the high success rate with the company’s drilling program and the robust grades delineated one would expect the Mineral Resource to reflect a bright outlook for the Arcadia project which is located in Zimbabwe.
Consequently, this could be a significant share price catalyst, and perhaps this accounts for the strong spike in the company shares on Tuesday morning which saw them trade up 10% at one stage.
However, it should be noted that the company is trading well shy of its 12 month high of 7.1 cents after some profit-taking occurred in recent months. This retracement could present a buying opportunity, particularly with the maiden Mineral Resource announcement imminent.
While upcoming events could provide positive momentum, prior trading patterns are not an indication of future share price performance and this along with assumptions regarding exploration results and the upcoming mineral resource announcement should not form the basis for an investment decision.
Consequently, independent financial advice should be sought if considering an investment in this early stage mining company. Another factor to take into account is that the Arcadia project is located in a region which carries sovereign risk.
While these issues contribute towards the speculative nature of PSC, there is no denying the strong grades delineated, and a summary of the most recent results is outlined below.
Importantly, drilling to date has only covered approximately 20% of the area covered by the company’s mining licenses, which in total is more than 600 hectares.
Management highlighted that the drilled strike of the 14 horizontally stacked pegmatites extends more than 1.7 kilometres south-west to north-east and some 700 metres down dip to the north-west, and is open along strike and down dip.
This latest round of assay results comes on the back of highly promising returns released on September 19, October 4 and October 21, all of which will contribute to the maiden resource estimate.
Management’s guidance regarding timing of the release of its maiden JORC Mineral Resource indicates that it will be announced by Monday of next week. This could spark buying in the stock in coming days.
As indicated below, the other significant catalyst which management is targeting for 2016 is the scoping study.