A report of nickel bearing sulphides being intersected at the Hanns Camp project in Australia sent shares in Strategic Minerals (LON:SML) soaring.
The junior is currently drilling its first holes at the deposit in Western Australia.
The sulphides included Pentlandite and exist in a low level disseminated form at approximately 286m downhole.
X-ray analysis indicated the ore was consistent with major West Australian Yilgan nickel deposits and yielded anomalous nickel levels of 1.2%.
Other characteristics were similar to the komatiite lava flow environments that host many of the major Yilgarn nickel deposits.
One the first hole is complete, a downhole electromagnetic (EM) survey will be used to home in on potential nickel sulphide accumulations.
The project manager believes the drill hole deviated below the EM conductor target and the planned downhole EM will help confirm this and more accurately pinpoint the conductor.
Once established, this location may be revisited to drill an additional hole aimed at intercepting any further defined EM conductors.
Following completion of HC001, the drill rig will move onto the second target; Stirling, to complete the second drill hole of the programme.
Hanns Camp forms part of the Laverton Project.
Strategic Minerals recently agreed an option on up to a 50% of Central Australian Rare Earths, the owner of the Laverton licence.
Alan Broome, chairman said: "The first hole validation of the exploration concept is pleasing given the work that has gone into getting to this point.
“While it is early yet, the XRF [X-ray] analysis is encouraging and is likely to see CARE adapt its drilling programme to hone in on the sulphide source.
“However, a true understanding of the commercial potential of the area will not really be available until lab results are received.”
Shares rose 27% to 0.363p.