St George Mining (ASX: SGQ) has received a Speculative Buy from RM Research. The following is an extract from the report.
Nickel Sulphide Explorer - High Impact Drilling Soon
Geologically Favourable Area
- St George is exploring for nickel sulphides at its 100% owned East Laverton Project in WA. The project covers +2,000km2, and contains ultramafic rocks that are similar to the nickel rich Agnew-Wiluna Belt that hosts a number of world class nickel sulphide deposits.
- SGQ’s projects cover three nickel belts, all of which are considered prospective for nickel, supporting the potential for multiple discoveries and the emergence of a new nickel camp.
- A sizeable database of work has been compiled to date which has demonstrated that the project has all the right attributes to host a high grade nickel sulphide deposit, including drilling that has intersected +1% Ni.
MLEM/Drilling Soon
The Company is currently completing a detailed MLEM geophysical study to refine targets before drilling. To date, a number of high priority targets have been generated.
These targets contain conductors (identified by the MLEM) which may represent nickel sulphides, which are located within the correct ultramafic rock types and often have anomalous nickel signatures at surface.
Good Science driving exploration
St George has undertaken a significant amount of detailed work to identify the correct host rocks, geological setting and likely mineralised horizons.
Building on the sizeable work completed by BHP, the Company is using highly experienced consultants Newexco, responsible for significant nickel discoveries for Sirius (Nova/Bollinger) and Western Areas (Spotted Quoll, Flying Fox deep mineralisation).
In addition, SGQ has added ex BHP geologist and nickel specialist Matthew McCarthy as a consulting geologist.
Good News Flow
The MLEM program is continuing, and we expect the Company to provide regular updates with new targets.
Following completion of the MLEM program, we expect St George to commence drilling in Q2 CY14, with results likely to follow c.6-8 weeks after commencement.
Price Catalyst
We expect that any positive results from the pending drill program is likely to lead to share price appreciation, with the presence of nickel sulphide mineralisation demonstrating proof of concept.
Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX “Small and Mid-cap” stocks with distribution in Australia, UK, North America and Hong Kong / China.