Rare earth elements firm Mkango Resources (LSE:MKA) shot up 10.3pc to 9.1p this morning after revealing across-the-board success in the first wave of test drilling at its Songwe project in Malawi. The first eight holes of its targeted 10,000m diamond drilling programme at the project all intersected rare earth mineralisation.
The firm said that intersections of broad zones of mineralisation, as opposed to narrow veins or dykes, continue to support the concept of a bulk tonnage, open pit mining operation with low mining costs. The drilling programme is a critical component of an ongoing feasibility study at Songwe and is focused on infill drilling to confirm and upgrade the existing inferred mineral resource estimates.
Mkango owns an 80pc stake in Songwe, which features carbonatite-hosted rare earth mineralisation and was subject to previous exploration in the late 1980s. The programme and a planned resource update are fully funded following investments by Talaxis Limited totalling £6 million in January 2018. Talaxis will invest a further £7 million to fund completion of the Feasibility Study for Songwe on Mkango, publishing an NI 43-101 technical report about the resource update.
As of 20 August, a total of 8,466m of drilling, comprising 70 drill holes, had been completed at Songwe. William Dawes, chief executive officer, said: ‘These are an excellent first set of results from the current programme and we look forward to announcing results from the remaining approximately 75 drill holes as they become available.