Power Metal Resources (LSE: POW) has hit new all time highs above 3p on news about its Ditau Project in Botswana.
The London-listed miner climbed more than 5% on Tuesday 5 January after announcing the first stage of orientation work at Ditau was now complete.
The Ditau project is made up of two licenses covering 1386km2, with the main focus being 10 large geological formations known as ‘ring structures’. One of the largest of these is 7km by 5km across. Each is thought to host carbonatite rocks, which are the principal source of rare earth elements.
The exercise examined the magnetic anomaly called ‘I10’, and included taking soil geochemistry samples along with controlled source audio-frequency magnetotellurics across a 5km run. The objective was to identify the position of rocks beneath the surface by testing their magnetic resistance.
Power Metal said it planned follow-up surveys for I10 in mid-January 2021, including gravity surveys at 50m intervals and a ground magnetic geophysics survey at 12.5m spacing.
Assay results and processed geophysics from the exercise are expected by early February 2021.
The results will shape the calibration of survey equipment for follow-on surveys of the remaining nine ring structures, Power Metal said.
The company’s Botswana project comprises a 50-50 joint venture with fellow AIM-listed explorer Kavango Resources (LSE: KAV) to discover rare earth elements including Neodymium (Nd) and Praseodymium (Pr).
The two metals are key elements in the manufacture of high-level magnets and parts for electric vehicles. Tesla (NASDAQ:TSLA) and Chinese competitor NIO (NYSE:NIO), for example, both use the sought-after metals in their engines.
Power Metal Resources has extensive geophysical surveying and soil sampling planned at Ditau throughout Q1 and Q2 2021, and an exploratory drill campaign is expected to start in early Q3 2021. Exploration is expected to be relatively straightforward: assuming the surveys can isolate specific drill targets, they can be tested by very low-cost reverse circulation drilling.
Back in April 2020, the Power Metal share price jumped to a then-high of 0.3p on news of the Ditau JV. Now the share price has gained some 900%, 3p is expected to be the baseline for the company to grow much more strongly.
CEO Paul Johnson commented:
“With the Ditau Project we are seeking a discovery of rare earth elements (REEs), which are highly valuable and sought after commodities, particularly from secure and stable jurisdictions such as Botswana.”
"The Strategic Joint Venture with Kavango is surging ahead with work completed and announced from the Kalahari Copper Belt, and now from the Ditau Project.”
Author: Mark Sheridan
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