New drilling program offers big potential for PolarX shareholders, says analyst’s report
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Special Report: PolarX shareholders have plenty to get excited about as a highly-leveraged drilling program gets under way at its Alaska Range copper-gold project, a new research report says.
The report, by Independent Investment Research’s highly-experienced analyst Mark Gordon, says the immense potential of the Saturn and Mars copper-gold porphyry targets at Alaska Range was what attracted North American major Lundin Mining Corporation to PolarX and the project.
Lundin Mining has just invested $4.3 million in PolarX via a share placement and stipulated that it wants the money spent exploring Saturn and Mars.
As part of the agreement, Lundin Mining can ultimately earn up to 51 per cent of these potentially huge porphyry prospects by staged spending of US$24 million on exploration and staged cash payments totalling US$20 million to PolarX.
But before it triggers the first annual US$8 million stage of the farm-in, it wants to see the results of the impending drilling program at Saturn.
So PolarX is now preparing to start a series of 8-10 deep holes aimed at providing some valuable insight into the prospect’s true potential.
In addition to the big Saturn and Mars prospects, Alaska Range also hosts the Zackly Claims. Zackly already has a JORC Resource of 44,000 tonnes of contained copper and 217,000oz of gold and is excluded from the Lundin Mining agreement, meaning it remains 100 per cent owned by PolarX.
Gordon says there is significant upside for PolarX shareholders at Saturn and Mars as well as Zackly.
“With an EV of ~A$36 million, the company is well leveraged to positive exploration news with the potential to return significant value to shareholders,” he says in his report.
“Ongoing data interpretation has confirmed the strong potential of Saturn and Mars for porphyry-style mineralisation, with Saturn interpreted as being the source of mineralising fluids for the Zackly skarn.
“Given the results of the 2018 work programme, we expect another concerted effort in 2019 (including expected drilling at Zackly, Saturn and Mars), with all indications that this will again bring very positive news.
Leading resource commentator Barry FitzGerald last week described porphyry drilling programs such as PolarX’s as “the closest thing there is in the mining game to drilling a textbook wildcat oil target with some scale about it.
“Snag something early on that confirms the big-time potential of the porphyry target – or the black stuff in an oil well – and it can be a case of being off to the races as the serious value of the prize is delivered in subsequent drilling,” FitzGerald wrote.
“That’s the position that PolarX finds itself in as it prepares to drill the first series of holes into its Saturn copper-gold porphyry target within its Alaska Range project, starting this month.”
FitzGerald noted the huge leverage for PolarX shareholders in the upcoming drilling program.
“It goes without saying that for a company trading at 10.5c for a market cap of $44 million , the months ahead make for exciting times for PolarX,” he said.