Kavango raises £2 million as ambitious KSZ drill programme expands (KAV)

Kavango Resources (LON: KAV) on Monday announced not only an expansion of its Kalahari Suture Zone drill programme but also an almost £2 million placing.

To start with, there’s the expansion of the Kalahari Suture Zone (“KSZ”) drilling programme in Botswana. This now involves drilling an impressive 550m borehole through Target B1, once operations at Target A2 & Target C1 are complete.

Mindea Exploration and Drilling Services (“Mindea”), the drill operator, began drilling at the KSZ in June with two ‘proof of concept’ geological holes. Mindea started with A2, and will proceed to C1 before moving on to B1.

Target B1 itself measures 475m by 550m and has a conductance of approximately 8,200 Siemens as well as an estimated decay constant of more than 350ms. While A2 and C1 share the same geological corridor, B1’s geological setting is separate and distinct.

The company said Spectral Geophysics will be performing “immediate down hole electromagnetic (“EM”) surveys” on all boreholes upon completion.

So far, Spectral has conducted Time Domain Electromagnetic (“TDEM”) surveys on six target areas. These identified drill targets in A2, C1, and B1 but not A1 or D.

Analysis of Target Area B2 data is still ongoing, with two more TDEM surveys planned for Target Area B, including on for Target B1.

Chief executive Ben Turney said the negative A1 and D1 results bring “a high degree of comfort”, since they means that the TDEM surveys are selectively identifying EM conductors. This is proof that the firm is “using the right remote sensing technology to define specific drill targets”.

As previously announced, 49% Mindea shareholder Equity Drilling and Kavango are in talks to form a strategic drilling partnership. Equity Drilling is currently “owned and run by highly experienced African drill operators”.

Options on the table include Kavango’s potential acquisition of two drill rigs as well as support vehicles which would form a “dedicated team” across the firm’s project portfolio.

The company said that any such partnership would be “subject to due diligence” and is expected to involve both cash and share payments. More announcements will follow.

Turning to the placing, then, First Equity placed 35.3 million new shares on Kavango’s behalf with institutional and other investors at a 5.5p per share price. This was only a 5% discount to the share price at the time.

The firm’s shares were trading higher, in fact, on Monday—up 3.5% at 6p each.

The placing involves a one-for-one warrant for all placing participants, with an 8.5p per shar exercise price for a two-year period.Warrants are subject to an acceleration clause, meaning that if Kavango’s shares close at more than 17p for five trading days then the company can give notice of an accelerated exercise with a ten-day deadline for payment.

Gross funds raised amount to £1.94 million.

Certain directors are in talks to potentially take part in a subscription on the same terms as the fundraise, with an announcement to follow later this week if they reach an agreement.

Turney said that while “Kavango is already well financed”, its budget was designed for “a specific work programme” with “a certain amount of drilling in 2021” while the company pursued if ‘proof of concept’ objective in the KSZ.

However, he explained, the board has now realised that its projects need “much more extensive campaigns”.

In response, the firm has advanced its Equity Drilling talks “about instigating much larger drill programmes” whish respond to Kavango’s “rapid progress” so far in the fiel 

The chief executive highlighted the “minimal discount and an excellent price” for the financing, reflecting the strength of the company’s position. 

“With our general overheads already budgeted for, Kavango will now deploy the new funds into pursuing our ambition of making one or more major mineral discoveries,” Turney concluded.

 

Author: Anna Farley

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, does not own a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article's content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

 

Seven drill-ready targets identified at Kavango and Power Metal’s promising Ditau project (KAV, POW)

Power Metal Resources (LON: POW) and Kavango Resources (LON: KAV) revealed on Friday that they have identified seven drill-ready targets for their Ditau project in Botswana.

The pair are seeking Rare Earth Elements (“REEs”) at Ditau under a 50:50 joint venture (“JV”), and identified the targets after geophysical and geochemical surveys spanning twelve prospective areas were completed.

Each of the seven targets has a “possible carbonatite intrusive body” in range of reverse circulation (“RC”) drilling are within 300m depth.

Three targets—I1, I4, and I10—are now classified as high priority.

I1 is an “intense magnetic dipole” spanning 17km by 8km. The depth to source is shallow, less than 100m, with the target likely sitting just beneath the Kalahari sands. I1 is at the intersection of two major regional fault lines.

Testing so far has identified anomalous niobium values at I1, a REE used for a number of superconducting materials as well as industrial alloys.

Target I4, meanwhile, spans 7.5km by 5km and, like I1, has a shallow depth to source – fewer than 100m.

I10 spans 2.5km by 2.8km and geophysics found “high AMT resistivity, coincidental with a gravity high”. This follows surveying with Audio-frequency Magneto-tellurics (“AMT”) and gravity surveying to assess density.

There are seventeen rare earth elements, all of which are metals, grouped together in the periodic table and usually found together in deposits. The group includes yttrium as well as the fifteen lanthanide elements. Scandium, which is found in the majority of REEs deposits, is sometimes considered a REE as well.

REEs are used in a large number of devices, including magnets, rechargeable batteries, computers, and mobile phones. Demand for these elements has skyrocketed as these kinds of devices become ubiquitous.

While REEs are found worldwide, China is the dominant player, with Chinese mines producing over 55% of the world’s global mining output for REEs in 2020.

Paul Johnson, Power Metal’s chief executive, said it is “extremely positive to be able to confirm high priority drill targets at Ditau in Botswana”, especially as its strategic objective is to discover REEs “at a time when the world is seeking secure and safe supply sources”.

Should the upcoming Ditau drill programme find the hoped-for REEs deposits, then he believes “Ditau will become an extremely valuable project”.

Ben Turney, Kavango’s new chief executive, added that the seven drill targets are “particularly encouraging”.

“Carbonatite hosted deposits of Rare Earth Elements hold significant strategic and commercial value. Kavango’s targets are relatively shallow, which should make it straightforward to determine this project's potential,” Turney noted.

The two companies have another Botswana JV, the South Ghanzi project in the Kalahari Copper Belt.

In June, the two reported excellent results from soil sampling at the Morula target at South Ghanzi. As soon as the JV partners obtain the necessary Environmental Management Plan for South Ghanzi, drilling will start at Morula. 

Separately, Kavango is set to start drilling at its Kalahari Suture Zone project in Botswana – announcing in June that it would start drilling there by the end of that month.

“We look forward to revisiting Ditau later this year, once we've completed our other high-impact drill campaigns,” Turney said.

Author: Anna Farley

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, owns a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article's content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

Kavango director Turney to take the reins as new chief executive (KAV)

Kavango Resources (LON: KAV) on Tuesday made the announcement it is promoting executive director Ben Turney to the role of chief executive officer.

“His assumption of the role of CEO is a natural progression, both for him and for the company,” the mineral exploration firm said.

Turney, who was appointed as executive director at the start of 2021, will take over from 40-year industry veteran Michael Foster.

Foster has been chief executive at Kavango since its July 2018 listing and will remain with the company as a non-executive director.

The firm said Turney “has been very active” ever since he joined the board, instigating “a number of important initiatives”. These have improved not only operations, but also communications, commercial development, and financial management.

For example, the incoming CEO was “instrumental in securing” Kavango’s strategic partnership with Spectral Geophysics covering the Kalahari Suture Zone (“KSZ”) in Botswana.

The partnership involves Spectral sharing its technical knowledge with Kavango, helping the company optimise future KSZ underground remote surveys. Kavango agreed to issue 3.0 million shares at 3p each to Spectral, tied in for 12 months, as well as 3.0 million warrants with a 4.25p per share exercise price.

At the time of the deal, Turney himself said it “guaranteed Spectral’s focused attention” in unlocking the KSZ and was “absolutely” expected to accelerate progress there.

Turney was also key to securing terms for the company’s deal with Mindea Exploration and Drilling Services/Equity Drilling.

“In Ben Turney we have a new CEO who has considerable energy and drive, and who shares the board's determination to deliver value to shareholders out of our various Botswana projects,” said non-executive chair David Smith.

Kavango’s annual general meeting takes place later this week. Subject to shareholder approval at this meeting, Hillary Gumbo – managing director of Botswana subsidiary Kavango Minerals – will join the company’s board.

Gumbo is responsible for exploration activities in Botswana was one of Kavango Minerals’ founders. He has been an important executive team member for years and is an experienced geophysicist.

The company also took the time to thank Chuck Forrest, who recently stepped down as chief financial officer but will remain a consultant as needed. ONE Advisory, which provides accounting services externally, will manage Kavango’s financial function.

Turney said the firm still has “plenty of work to do” and considerable opportunities with “three potentially major projects” each with “a chance of delivering a major metals discovery”.

These projects include the Kalahari Suture Zone, as well as two Kalahari Copper Belt (“KCB”) joint ventures: the South Ghanzi joint venture with Power Metal (LON: POW), and the LVR joint venture with LVR GeoExplorers.

The board changes follow a series of exciting company announcements. Year-to-date, Kavango’s shares are up more than 120% as its projects approach major milestones.

For example, the latest results from its Morula target at South Ghanzi were so encouraging that it has surpassed the Acacia target and become the number one priority for drilling.

Not only that, but earlier in June Kavango said drilling will start this month in the northern Hukuntsi section of the KSZ. Drilling is set to begin no later than Wednesday next week.

“We are well funded and have advanced exploration programmes, delivering a constant stream of new data. Everything is now in place for an exciting period of growth,” Turney concluded.

Author: Anna Farley

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, owns a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article's content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

 

Excellent results lead Kavango and Power Metal to crown Morula new South Ghanzi priority (KAV, POW)

Kavango Resources (LON: KAV) and Power Metal Resources (LSE:POW) on Monday unveiled yet more encouraging results from their South Ghanzi project in the Kalahari Copper Belt.

Since an announcement on May 14, Kavango has now completed and analysed samples taken from 16km of infill soil-sampling at Morula.

Airborne Electromagnetic (“AEM”) surveys at South Ghanzi previously defined “seven kilometre-scale conductors” at South Ghanzi. Targets Acacia and Morula are the highest priority short term, with Acacia previously top of the list.

Now, as a result of these latest highly encouraging results, Morula has overtaken Acacia to become the 50/50 joint venture’s (JV) highest priority target for exploration.

As soon as the JV partners obtain the necessary Environmental Management Plan (“EMP”) for South Ghanzi, drilling at Morula will begin.

 

Encouraging results

The latest sampling involved four 4km-long sample lines spaced 1km apart, sampled every 100m.

Work found anomalous copper levels, from all soil sample lines, of between 35 parts per million (“ppm”) and 68ppm, as well as anomalous zinc levels of between 59ppm and 111ppm.

These new readings closely correlated with results from seven original soil-sampling lines at South Ghanzi.

Impressively, samples confirmed that the conductor/anomaly at Morula extends at least 12km along strike.

This “clearly defined mineralised zone” is on a south-westerly trend and runs parallel to two steep anticlinal structures. It is open in both directions along strike.

The JV partners are now working to assess optimal locations for drilling at Morula and Acacia, where targets look to be near the surface and have “minimal Kalahari sand cover”.

Estimated intercept depths for drilling are between 120m and 200m.

 

Well researched targets

Until Morula, Acacia was the highest priority target for drilling at South Ghanzi. Acacia is located on Prospecting Licence (“PL”) 036/2020’s northern boundary, inside an interpreted fold “nose”.

In geology, a fold is when factors like heat, stress, and pressure cause rocks to bend or flex. Folds can have a “nose”, a curved shape at the fold’s tip where metals often accumulate.

Soil geochemistry over the anomaly shows highly elevated copper levels of more than 42ppm and zinc of more than 75ppm.

Morula, meanwhile, is an estimated 2km wide, with its at least 12km of strike following a south-westerly ttend along PL 036’s central backbone.

The target was discovered by extending soil sampling lines south of Acacia, and is “supported by a well-defined AEM linear conductor”. 

Through geological mapping, the JV parties have found evidence that Morula is the mineralised sheares southern limb of the Acacia fold.

Initial drilling depths for Morula are thought to be less than 200m, based on AEM profiles showing relatively shallow mineralisation.

 

Transformational potential

The two companies have made plans to transfer the PLs for South Ghanzi into Kanya Resources, their recently established Botswana JV company. Looking ahead, the two intend to float Kanye on a recognised stock exchange.

Kavango chief executive Michael Foster said “Morula is rapidly developing into one of the most exciting drill targets in our entire portfolio”, noting that the company plans to start drilling “as soon as we can, after we have received approval of our EMP”.

Paul Johnson, Power Metal’s chief executive, commented on “the substantial opportunity the Kalahari Copper Belt offers for major base metal discoveries”.

He pointed out that, during his time as chief executive of Kalahari Copper Belt explorer Metal Tiger (LON: MTR) in 2016, “we followed a similar exploration methodology”.

That same methodology led to the discovery of the T3 Deposit, a “transformational” discovery for Metal Tiger and its shareholders.

“The exploration datasets from South Ghanzi have delineated very strong drill targets and I am very much looking forward to the commencement of a programme of drill testing at the Project,” Johnson concluded.

Author: Anna Farley

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, owns a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article's content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

 

Kavango Resources’ powerful run continues with exciting new EM anomaly in Botswana (KAV)

Kavango Resources’ (LSE: KAV) strong run of newsflow continued on Tuesday, with the firm revealing that it has identified a new target at its highly prospective Kalahari Suture Zone project in Botswana.

As announced Thursday last week, Kavango is gearing up to start drilling in the Kalahari Suture Zone (“KSZ”) this June with two ‘proof of concept’ geological holes.

This latest electro-magnetic (“EM”) anomaly is in Target Area C of the KSZ’s Hukuntsi (northern) section and is designated Target C1 (“C1”).

The conductive anomaly, measuring 1,200m by 1,600m, is situated only 11km from Target A2 (“A2) – announced April 20. Not only that, but C1 and A2 appear to share the same geological corridor.

Drill operator Mindea Exploration and Drilling Services (“Mindea”) has already set up camp between the two targets and will start drilling at A2 in June and C1 in July. There will be at least one hole in A2 and at least one in C1.

Under the contract, Mindea will drill at least one 500m diamond hole at each of the two targets at Hukuntsi, with the cost per metre based on a possible per hole depth of 800m. The contracted company will also design and engineer all of the bore holes.

Not only that, but there is potential for increasing the drilling scope once the rig is on site – pending additional data analysis.

In yet more encouraging news for Kavango, it will pay less than half the drill cost to Mindea in cash, approximately £70,000. The rest is payable in shares, with the stock issue price being 4.53p per share

The two targets lie within what Kavango has described as “‘Norilsk-style’ gabbro keels”, and the goal with both drill holes will be to recover and analyse core from the bottom of the keels in order to test for the “potential to host major metal sulphide deposits”.

‘Norilsk-style’ refers to northern Russia’s Norilsk mining centre. Norilsk is the leading nickel and palladium producer in the world and a significant copper supplier. Gabbro is a type of rock formed when magma cools slowly under the earth’s surface.

Chief executive Michael Foster praised the “highly similar characteristics” shared by C1 and A2, calling it “very encouraging”. He highlighted the targets’ “ideal geological setting” and C1’s size, as well as its “conductance of 2,500 Siemens and a decay constant of ~360msec”.

Drilling at the KSZ follows three years of “extensive geophysical surveys” at Hukuntsi by air and on the ground. Efforts include an orientation drill programme, which helped build the firm’s extensive 3D Magnetic Model, as well as Time Domain Electromagnetic (“TDEM”) surveys.

In keeping with this scientific approach, Kavango intends to conduct “extensive assaying and downhole geophysics” for all of the boreholes drilled.

The planned testing programme for the boreholes includes downhole electromagnetic (“EM”) surveys, which will be performed by Spectral Geophysics. The anticipated search radius for these surveys will be between 300m and 400m from the drill string. 

Additionally, the Kavango exploration team will conduct XRF testing of cores, as well as splitting the core for assay and petrological work.

Academic consultants in the UK will further analyse the petrological/mineralogical and geochemistry studies.

Elsewhere, Equity Drilling, a 49% Mindea shareholder, is in “ongoing discussions” for a possible future strategic partnership with Kavango. The company currently operates what Foster described as a first of its kind “highly regarded drill school in Gaborone”.

With drilling now imminent, this is an intense moment in Kavango’s history, perhaps the most important so far.

Shares in the company had risen by more than 3% on Tuesday morning, having grown by more than 120% year-to-date. This includes a rise of close to 40% in the last five days with a strong boost from the announcement on Thursday.

“If drilling validates our interpretation of the data, this could prove to be a significant development in our attempts to unlock the Kalahari Suture Zone,” Foster said.

Author: Anna Farley

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, owns a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article's content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance