OD6 Metals Ltd (ASX:OD6) has surged on revealing a maiden inferred mineral resource estimate (MRE) of 344 million tonnes at 1,308ppm TREO at a 1,000ppm cut-off grade for its Splinter Rock Rare Earth Project, which is emerging as one of the largest and highest-grade clay-hosted rare earth resources in Australia.
The ASX debutant’s MRE includes 149 million tonnes at 1,423 ppm TREO with 23% magnet rare earth oxides (MREO) at the standout Centre Prospect and near-surface mineralisation up to 70 metres thick.
Notably, less than 5% of the targeted clay basin area is included in the estimate, with ongoing exploration to further expand the known mineralisation.
Investors have responded strongly to the MRE, with OD6 shares as much as 44.45% higher in ASX trading this morning to $0.325.
Looking ahead, the continued exploration will prioritise the “best of the best” in terms of grade, MREO content, thickness and metallurgical recovery, with phase 3 drilling results anticipated this quarter at the project.
Significant potential to grow
OD6 managing director Brett Hazelden said: Our Splinter Rock Project maiden mineral resource estimate of 344 million tonnes at 1,308 ppm TREO is emerging as one of the largest and highest-grade clay-hosted rare earth resources in Australia.
“This remarkable milestone has been achieved within our first year of listed life.
"With less than 5% of our clay basin area tested and phase three drilling underway, over the next 6 to 18 months there is significant potential to grow the resource base and by applying our geometallurgical exploration techniques, prioritise the ‘best of the best’ in terms of grade, MagREO content, thickness and metallurgical recovery is the backbone of the company’s focus and we look forward to both expanding the current resource and zeroing in on our high-priority areas.”
MRE summary
Splinter Rock Project comprises 2,579 square kilometres of granted exploration licences about 150 kilometres northeast of Esperance in Western Australia.
The Splinter Rock clay-hosted REE mineralisation is thought to be a mobilised weathering product of the REE-enriched Booanya granite suite, which underlies the project area.
The key magnet rare earth elements neodymium (Nd), praseodymium (Pr), terbium (Tb) and dysprosium (Dy) are included individually as these four rare earths comprise the highest price and demand, driving the future economics of the project.
A cut-off grade of 1000 ppm TREO was chosen based on a preliminary review of the parameters that would likely determine the economic viability of an open pit operation and with a comparison with other clay-hosted REE deposits.
The mineral resource was estimated cumulatively for consecutive grade groups which allows for the results to be reported cumulatively for different cut-off grades and presented for comparison purposes.
Splinter rock rare earth project mineral resource estimate.
Forward plan
The next steps at Splinter Rock include:
- continue infill drilling to upgrade the maiden MRE to indicated classification;
- continue metallurgical studies to design an appropriate flow sheet;
- concentrate further immediate geological work on the identification of high-grade material; and
- determine what is required to estimate an indicated mineral resource of sufficient size to support capital expenditure and progress.
There is significant potential for further mineral resource upgrades with the phase three 188-hole, 10,000 metres drill program ongoing at Splinter Rock which has strong potential to expand the known resource area substantially.
The focus is to test the length of the prospects and determine the continuity of grade and thickness of the extensions. Metallurgical samples will also be selected for further work at ANSTO once assays have been received.