Metal Tiger (LSE:MTR) and MOD Resources (LSE:MOD) fell this morning after revealing that a hole drilled by their joint venture (JV) business in Botswana did not return commercial grades. However, with another hole intersecting wide zones of finely disseminated copper mineralisation, the firms said they remain ‘very encouraged’ by their initial results in the country’s Kalahari Copper Belt (KCB).

Today saw the companies update investors on the exploration activities completed by JV business Tshukudu Exploration, formed earlier this year when Metal Tiger sold its stake in the T3 project, also based in the KCB. Tshukudu is 30pc-owned by Metal Tiger and 70pc-owned by MOD and controls exploration permits covering around 8,000km2 in the KCB. It is worth noting that Metal Tiger’s exposure is bolstered further by its 12.5pc stake in MOD.

As previously announced, Tshukudu has been carrying out widely-spaced drilling at a prospect called the T23 Dome, which is part of the regional scale T20 exploration project. It sits around 15km west of another prospect called T4, where the JV intersected strong copper mineralisation in 2016, including an intersection of 2m at 6.1pc copper and 111 g/t silver from 101m depth.

In today’s update, Tshukudu’s owners revealed the assay results for hole MO-T23-001D, its first foray into the T23 dome. It encountered a shallow intersection of 25m at 0.36pc copper and 4g/t silver from 65m downhole depth, including 3m at 0.7pc Cu & 10g/t Ag from 65m downhole and 1m at 1pc Cu & 13g/t Ag from 80m downhole.

MOD said that while these are not economic grades, they do confirm that copper mineralisation occurs in the sequence – called the lower D’Kar formation – that hosts all known deposits in KCB. MOD added that this provides Tshukudu with the confidence to expand drilling to test the potential for high-grade vein systems and high-priority NPF contact along the structurally complex area.

As at writing, Metal Tiger was trading down 13.5pc to 1.47p while MOD had fallen 7.6pc to 19.4p following the release of the news. These falls come despite a third diamond drilling hole at T23 – MO-T23-003D – intersecting wide zones of finely disseminated chalcocite and bornite copper mineralisation from 85m to 385m downhole depth. The hole also encountered a strongly mineralised vein at 268m, confirming the potential for high-grade vein-hosted mineralisation similar to other copper discoveries in the KCB. Tshukudu is now waiting for assay results that will confirm copper grades in the hole.

Elsewhere today, both companies reiterated that airborne electromagnetic geophysics surveys carried out over T23, T4, and another site called T22 has identified numerous additional prospects. These include several new buried dome structures and fold features that offer structural drilling targets for a programme planned in early 2019.

Multiple copper and zinc soil anomalies have also been identified to the south of T23, extending around 60km along the centre of the T20 exploration project and open to the west.  These will be high priority targets for drill testing early next year.

On today’s results, Michael McNeilly, chief executive officer at Metal Tiger, said: ‘We are delighted to report another intersection of shallow copper mineralisation on the T23 Dome, which forms part of the T20 Exploration Project, 100km west of the T3 Project. With further drilling targets identified by the latest geophysics data interpretation and soil sampling results, we have a qualified pipeline of further exploration drilling targets and a good prospect of new discoveries for 2019.’

Meanwhile, MOD's managing director Julian Hanna added: ‘While we are still at an early stage of exploring the T23 Dome, we are very encouraged by the first drilling results. Having confirmed the prospectivity of this area, our exploration team can now start testing the potential for high-grade mineralisation within specific structures defined by the EM.

‘MOD's discovery in March 2016 which is now the T3 Copper Project, followed by recent successes at the A4 and A1 Domes, and now the T23 Dome, suggests the Central Structural Corridor, which links all these occurrences, may represent one of the largest, most under-explored district scale targets for sediment hosted copper.’

When we spoke to McNeilly earlier this month, he reiterated his excitement at the sizeable unexplored potential on offer across Tshukudu’s considerable acreage in the KCB:

‘There is just a huge amount of area that we haven’t even covered yet, and so many different target deposits where we are looking for T3-type deposits where the mineralisation has ideally been thrust up, concentrated and folded over into a nice slab mineralisation near surface. There are also many prospective Ngwako Pan Formation contacts that host other substantial copper deposits at depth. With this much going on, the right thing to do at this time is to demonstrate the area’s potential for development. This is why we are going off and drilling other targets and not just spending our money on one area.’

Author: Daniel Flynn

Disclosure: The author does not own shares in the company mentioned above