Sunrise Resources (LON:SRES) told investors today that it is funded for the work programmes planned at its key projects for this year.

Following a £600,000 fundraising in February, Sunrise had £1.02 million in the bank at the end of March, which it said ensured that it can continue to advance the Derryginagh and Cue projects through 2012.

At Derryginagh, which is in Ireland, the company is currently evaluating potential for a modest scale mning operating producing high-value white barite for use as industrial filler.

The results from the first drill programme at the project confirmed that high-grade extensions to the barite vein system exist well below the old mine workings.

It has been estimated that there is sufficient tonnage potential to support an annual production of at least 50,000 tonnes of barite for several years as mineralisation remains open at depth.

At the Cue diamond project in Western Australia, drill sites have been laid out and a surface sample of the Cue 1 kimberlites has been collected for further evaluation.

An Aboriginal Heritage Survey is required before drilling can begin and this is now in progress, said Sunrise. The drill programme aims to collect samples for a preliminary evaluation of diamond content and quality.

Sunrise Resources (LON:SRES) says that its continued feasibility work is justified at the Derryginagh barite project as drilling returns high grade results.This morning the company revealed results from the company’s first drill programme at the project in south-west Ireland.

The findings confirm high-grade vein intersections below historical mine workings, Sunrise said.

The best results included a 3.6 metre intersection containing 89 per cent barite from a depth of 200 metres and a 3.2 metre intersection of 61 per cent barite from 220 metres. Sunrise says the barite mineralisation remains open at depth and along strike.

"These results confirm that high-grade extensions to the Derryginagh barite vein system exist well below the old mine workings, and below the level of previous drilling carried out in the 1980s,"  said chairman Patrick Cheetham.

"The dimensions of the vein system outlined by drilling to-date are encouraging and further feasibility studies are justified."

Sunrise is now planning further feasibility work at the project.

Barite is an industrial mineral that has many uses, it is most commonly used as a weighting agent in drilling and as a filler in paint. Sunrise believes that the Derryginagh barite is of a sufficient quality to be used as a ‘premium’ paint filler, and as such its market value is estimated at around £200 per tonne.

“The market seems to be warming to the barite story given recent strong pricing and demand fundamentals which we see continuing,” said Andrew McGeary, analyst at Northland Capital.

The analyst added: “The (drill) campaign has successfully extended the mineralisation at depth, and demonstrated high grades with good continuity.”

According to McGeary it is expected to be a relatively simple task to extrapolate the thickness of Derryginagh’s barite mineralisation so that Sunrise can gain a good understanding of the deposit.

“Thus, while it is not ruled out at this stage, a JORC resource may not be necessary to progress the deposit. The next stage is likely to comprise some form of scoping study incorporating the new data,” he said.

Sunrise Resources says that its continued feasibility work is justified at the Derryginagh barite project as drilling returns high grade results.

This morning the company revealed results from the company’s first drill programme at the project in south-west Ireland.

The findings confirm high-grade vein intersections below historical mine workings, Sunrise said.

The best results included a 3.6 metre intersection containing 89 per cent barite from a depth of 200 metres and a 3.2 metre intersection of 61 per cent barite from 220 metres. Sunrise says the barite mineralisation remains open at depth and along strike.

"These results confirm that high-grade extensions to the Derryginagh barite vein system exist well below the old mine workings, and below the level of previous drilling carried out in the 1980s,"  said chairman Patrick Cheetham.

"The dimensions of the vein system outlined by drilling to-date are encouraging and further feasibility studies are justified."

Sunrise is now planning further feasibility work at the project.

Barite is an industrial mineral that has many uses, it is most commonly used as a weighting agent in drilling and as a filler in paint. Sunrise believes that the Derryginagh barite is of a sufficient quality to be used as a ‘premium’ paint filler, and as such its market value is estimated at around £200 per tonne.

“Having peaked at 6.7p last year, shares have fallen back to below 1p, a capitalisation that reflects little potential for the portfolio,” analyst Andrew McGeary said in a note to clients.

“From such a low base there is good scope for future outperformance.” 

McGeary says this outperformance could come from any one of the firm’s three projects – the Derryginagh barite project, the Long Lake gold project and diamond exploration.

This morning Sunrise announced the completion of its first drilling programme at the Derryginagh barite project in south-west Ireland. Assay results are expected later this month.

“Encouragingly (barite) mineralisation has been extended to 180 metres below surface, compared to the 60 metres extent of the old workings which is significant,” the analyst said.

“On visual inspection, thicknesses are said to be in line with shallower intersections and of high grade.” 

“Whilst news on potential for lateral extension is less positive, this remains inconclusive at this stage and the deposit also remains open along strike.”

McGeary reckons Derryginagh has the potential to underwrite the Sunrise business going forward as the company pursues other, potentially higher impact, prospects. 

At Derryginagh Sunrise is targeting the production of white barite for use as industrial filler in paint and plastics. An important first milestone at the project was the completion in May 2011 of a positive concept study, suggesting a profitable underground operation with output of at least 50,000 tonnes per year.

The recently completed drilling comprised six holes for a total of 892 metres and has been successful in extending the known barite vein system to approximately 180 metres vertically below surface. 

This represents a significant depth below the old workings where the drill intercepts, based on visual inspection, have thicknesses in line with shallower historical intersections and are visually estimated to be high-grade.

Geological logging of the drill core is being completed and results will be evaluated together with down-hole survey data to allow more detailed information to be released after assay results become available.

Sunrise expects to start feasibility studies for Derryginagh this year.

The group sees a substantial market for white barite in Europe which has traditionally been supplied from China, but the Chinese deposits are becoming exhausted and remaining reserves are being reserved for a growing domestic market.

It is planning a modest-sized underground mining operation feeding a low cost gravity separation plant producing high-value filler grade barite.

Barite is the mineral form of the chemical barium sulphate. It is an environmentally friendly, non-toxic natural product. It is chemically and physically unreactive, has a high specific gravity, and low oil adsorption. It also has good sound-deadening and radiation-shielding properties. 

Its properties make barite suitable for use as a weighting agent in oil industry drilling muds and as higher value industrial filler in, for example, paint plastics, brake linings and acoustic panels. 

Adds comments from broker Northland Capital

Drilling work on Sunrise Resources’ (LON:SRES) Derryginagh barite project is set to resume early next month after the group hired a new drill contractor today.

Last month the group halted work at Derryginagh and terminated the previous drill contract. The company said that the decision was made because the contractor’s progress was ‘unacceptably slow’.

This morning Sunrise announced that it has now signed a new drill contract, with Irish firm Priority Drilling Ltd, and the drill programme will resume in the week starting October 10.

Once work resumes Sunrise expects that the drill programme will take about 6 weeks to complete, and assay results will be available about 6 weeks after that. 

Initially the drill programme began at the beginning of April. Barite is an industrial mineral that has many uses, it is most commonly used as a weighting agent in drilling and as a filler in paint. 

Importantly Sunrise believes that the Derryginagh barite is of a sufficient quality to be used as a ‘premium’ paint filler, and as such its market value is estimated at around £200 per tonne.

Sunrise completed a concept study for Derryginagh in May, with positive results. The study suggested that a profitable operation could be developed for an output of at least 50,000 tonnes per year of barite. This drill programme, aimed at the defining a JORC mineral resource, is the next step for the potential mine development.

Northland Capital analyst Andrew McGeary highlighted that today’s update was a ‘timely reminder that Sunrise is more than a one project company’, following the last round of drill results from the Long Lake gold project in Canada, which disappointed. 

“Whilst lacking some of the lustre of the gold project (which still offers prospectivity), we continue to view Derryginagh as a potential useful cash flow generator and near term production opportunity,” McGeary said in a note to clients. 

“This drilling campaign should help firm up on that belief. “Following the retracement after the Long Lake announcement, we believe (the valuation for the) shares look undemanding.”

Drilling work on Sunrise Resources’ (LON:SRES) Derryginagh barite project is set to resume early next month after the group hired a new drill contractor today.

Last month the group halted work at Derryginagh and terminated the previous drill contract. The company said that the decision was made because the contractor’s progress was ‘unacceptably slow’.

This morning Sunrise announced that it has now signed a new drill contract, with Irish firm Priority Drilling Ltd, and the drill programme will resume in the week starting October 10.

Once work resumes Sunrise expects that the drill programme will take about 6 weeks to complete, and assay results will be available about 6 weeks after that. 

Initially the drill programme began at the beginning of April. Barite is an industrial mineral that has many uses, it is most commonly used as a weighting agent in drilling and as a filler in paint. 

Importantly Sunrise believes that the Derryginagh barite is of a sufficient quality to be used as a ‘premium’ paint filler, and as such its market value is estimated at around £200 per tonne.

Sunrise completed a concept study for Derryginagh in May, with positive results. The study suggested that a profitable operation could be developed for an output of at least 50,000 tonnes per year of barite. This drill programme, aimed at the defining a JORC mineral resource, is the next step for the potential mine development.

More work will be needed at the Long Lake Project near Sudbury in Canada, said Sunrise Resources (LON:SRES) today as it reported results from its second-round drill programme at the project.

Nine holes were drilled in the latest programme, and the best result obtained was for one metre that graded at 1.2 grams per tonne of gold at drill hole 11LD005.

Last year, Sunrise reported results from drilling from nearby holes that included drill hole 10LD003, where an intersection of 35.4 metres graded at two grams per tonne, and drill hole 11D011, where three metres at 0.5 grams per tonne was obtained.

The Long Lake Project is being evaluated for gold and also nickel sulphide mineralisation in two separate areas. Historically, the Long Lake Gold Mine produced 57,000 ounces of gold from more than 200,000 tonnes of ore mined from a 60-metre diameter open hole.

Previous exploration in the Long Lake area in the 1970s and 1980s focused mainly on the E1 prospect. Sunrise said today that re-sampling of the historic core from the E1 prospect confirms high-grade intersections in the 1970s drill hole E1 (5.7 metres grading at 27.5 grams per tonne) and in the 1980s drill hole 87-9 (4.1 metres grading at 14.8 grams per tonne).

Meanwhile, the firm said that exploration efforts will be broadened eastward to evaluate nickel-copper-PGM targets on projected extensions to the world-class producing Copper Cliff dyke system.

“The results from this second drill programme, whilst not building on the success of the first, suggest that more work is needed to better understand the structural complexities controlling the gold mineralisation at Long Lake,” said Sunrise’s executive chairman, Patrick Cheetham. “However, the sampling results from E1 are encouraging.”

The company said that it took the decision because the contractor’s progress was ‘unacceptably slow’. It said that although the drill programme will be delayed, the cost implications of this decision are nominal.

“The company hopes to secure an alternative contractor shortly to complete the drilling and will make a further announcement when drilling is scheduled to recommence,” Sunrise said.

“The board strives to manage costs very carefully and whilst there will be a few weeks delay to the programme the cost implications of this are nominal.”

Drilling work began at Derryginagh at the beginning of April. Barite is an industrial mineral that has many uses, it is most commonly used as a weighting agent in drilling and as a filler in paint. 

Importantly Sunrise believes that the Derryginagh barite is of a sufficient quality to be used as a ‘premium’ paint filler, and as such its market value is estimated at around £200 per tonne.

The programme was supposed to take 6 weeks to complete, with eight holes provisionally planned. It was designed to test the main vein system over a strike length of 500 metres and to a depth of up to 150 metres.  

Sunrise completed a concept study for Derryginagh in May, with positive results. The study suggested that a profitable operation could be developed for an output of at least 50,000 tonnes per year of barite. This drill programme, aimed at the defining a JORC mineral resource, is the next step for the potential mine development.

Sunrise Resources (LON:SRES)  has started drilling at the Derryginagh barite project in south-west Ireland.

This morning’s announcement follows yesterday’s news that a ten-hole drill programme had begun at the company’s Canadian gold project, Long Lake.

Today Sunrise said that eight holes are provisionally planned at Derryginagh and the drill programme is designed to test the main vein system over a strike length of 500 metres and to a depth of up to 150 metres.  

Barite is an industrial mineral that has many uses, it is most commonly used as a weighting agent in drilling and as a filler in paint. Importantly Sunrise believes that the Derryginagh barite is of a sufficient quality to be used as a ‘premium’ paint filler, and as such its market value is estimated at around £200 per tonne.

"With drilling now underway at both Long Lake and Derryginagh it promises to be a highly active summer for the company and we look forward to the results,” said chairman Patrick Cheetham.

Sunrise completed a concept study for the barite project in May, with positive results. The study suggested that a profitable operation could be developed for an output of at least 50,000 tonnes per year of barite

This drill programme, aimed at the defining a JORC mineral resource, is the next step for the potential mine development. Drilling is expected to about 6 weeks and the results should be available 6 weeks after the programme ends.

Meanwhile metallurgical evaluation is continuing, using a large sample of barite collected from a surface trenching programme. Sunrise expects that this will generate more detailed process plant design data and generate samples for market appraisal.

In a note to clients Northland Capital’s Andrew McGeary said: “With the shares heavily correlated to the Long Lake gold project we perceive the Derryginagh as potentially free upside potential.”

“Drilling will follow up the concept study announced in May which suggested a profitable operation for at least 50,000 tonnes p.a. of barite could be established.” 

The second phase of exploration drilling is now underway at Sunrise Resources (LON:SRES)   Long Lake gold project, near Sudbury in Canada.

The programme is designed to follow up the successful first phase drilling, which found extensions to Long Lake’s historic, near surface mine workings.

Sunrise chairman Patrick Cheetham believes the next drill programme will be a key milestone in the coming months, and while acknowledging that the results were positive last time round, he believe this second phase of drilling will be pivotal to the group’s plans for Long Lake. Sunrise secured a three-year option to acquire the project last year.

“It is likely to be a make or break programme for project,” Cheetham told Proactive Investors. “The results will be very influential as far as our option to acquire the project is concerned.”

The programme is designed to test down-dip and along-strike extensions to the gold mineralisation mined in the period prior to the mine's closure in 1939 and will test a number of recently defined geophysical targets around the mine site, Sunrise said.

The two new prospects are known as ‘E1’ and ‘Anomaly 23’.

The diamond drill programme will consist of ten holes, for a total of 1,000 metres. Sunrise is expects the programme to last for six weeks.

It then expects the first analytical results, from drill samples, will be available within 6 weeks after drilling finishes.

Earlier this year Sunrise reported results from its first round of drilling at the mine site included a best result of 17 metres grading 2.9 grams per ton of gold, including 2.3 metres grading 16.1 grams per ton within a 35 metre thick interval grading two grams per ton. Grades to 55 grams per ton (1.8 ounces gold per tonne) were also reported over narrow intervals.

The deepest hole from that programme intersected the mineralised mine sequence in the predicted position below the mine workings confirming continuation of the mineralisation at depth.

Further drilling is also planned to test a number of recently-defined geophysical targets around the mine site and nearby. 

Sunrise Resources (LON:SRES) told investors that its second drill programme is now underway on the Long Lake gold project, near Sudbury in Canada.

The programme is designed to follow up the successful first phase drilling, which found extensions to Long Lake’s historic, near surface mine workings.

It will seek down-dip and along-strike extensions to the gold mineralisation mined in the period prior to the mine's closure in 1939 and will test a number of recently defined geophysical targets around the mine site, Sunrise said.

The two new prospects are known as ‘E1’ and ‘Anomaly 23’.

The diamond drill programme will consist of ten holes, for a total of 1,000 metres. Sunrise is expects the programme to last for six weeks.

It then expects the first analytical results, from drill samples, will be available within 6 weeks after drilling finishes.

Earlier this year Sunrise reported results from its first round of drilling at the mine site included a best result of 17 metres grading 2.9 grams per ton of gold, including 2.3 metres grading 16.1 grams per ton within a 35 metre thick interval grading two grams per ton. Grades to 55 grams per ton (1.8 ounces gold per tonne) were also reported over narrow intervals.

The deepest hole from that programme intersected the mineralised mine sequence in the predicted position below the mine workings confirming continuation of the mineralisation at depth.

Further drilling is also planned to test a number of recently-defined geophysical targets around the mine site and nearby. 

Broker view

The news that mining business Sunrise Resources (LON: SRES) has managed to secure a drill contract for more drilling at its Long Lake gold project in Canada should be seen as positive given the tight availability of drills, according to house broker Northland Capital Partners.

Three weeks ago, Sunrise said that it was planning a follow-up programme at Sudbury after initial results showed that gold mineralisation extends near the surface beyond that mined during the period before the mine closed before the Second World War. Today, the firm confirmed that the second programme of drilling has been contracted to start by 4 July.

The drilling will seek down-dip and along-strike extensions to the gold mineralisation mined in the period prior to the mine's closure in 1939.

Earlier this year the company's reported results from its first round of drilling at the mine site included a best result of 17 metres grading 2.9 grams per ton of gold, including 2.3 metres grading 16.1 grams per ton within a 35 metre thick interval grading two grams per ton. Grades to 55 grams per ton (1.8 ounces gold per tonne) were also reported over narrow intervals.

The deepest hole from that programme intersected the mineralised mine sequence in the predicted position below the mine workings confirming continuation of the mineralisation at depth.

Further drilling is also planned to test a number of recently-defined geophysical targets around the mine site and nearby.

The entire programme will comprise around 10 holes for around 1,000 metres of diamond drilling and it expected to take six weeks to complete, with analytical results from drill samples expected another six weeks after that.

“The results from our first drill programme included high-grade gold intersections that exceeded expectations. We look forward to the results from the follow-up drilling programme and expect to build on those exciting first results,” said Patrick Cheetham, Sunrise’s executive chairman.

Northland said Sunrise has now entered an important stage that is expected to build on earlier knowledge of the “encouraging” first phase of drilling as the firm retests Anomaly 23 (which has already indicated potential massive sulphide mineralisation) and drills for the first time the “highly prospective” E1 area.

At 11:05am Sunrise’s shares were up 6.8% at 3.15 pence each. 

Mining business Sunrise Resources (LON: SRES) has secured a drill contract for a second round of drilling at its Long Lake gold project near Sudbury in Canada.

Three weeks ago, Sunrise said that it was planning a follow-up programme at Sudbury after initial results showed that gold mineralisation extends near the surface beyond that mined during the period before the mine closed before the Second World War. Today, the firm confirmed that that programme has been contracted to start by 4 July.

The drilling will seek down-dip and along-strike extensions to the gold mineralisation mined in the period prior to the mine's closure in 1939.

Earlier this year the company's reported results from its first round of drilling at the mine site included a best result of 17 metres grading 2.9 grams per ton of gold, including 2.3 metres grading 16.1 grams per ton within a 35 metre thick interval grading two grams per ton. Grades to 55 grams per ton (1.8 ounces gold per tonne) were also reported over narrow intervals.

The deepest hole from that programme intersected the mineralised mine sequence in the predicted position below the mine workings confirming continuation of the mineralisation at depth.

Further drilling is also planned to test a number of recently-defined geophysical targets around the mine site and nearby.

The entire programme will comprise around 10 holes for around 1,000 metres of diamond drilling and it expected to take six weeks to complete, with analytical results from drill samples expected another six weeks after that.

“The results from our first drill programme included high-grade gold intersections that exceeded expectations. We look forward to the results from the follow-up drilling programme and expect to build on those exciting first results,” said Patrick Cheetham, Sunrise’s executive chairman.