Legend Mining Limited (ASX:LEG) recently hit further massive nickel-copper sulphides in diamond drilling at Mawson prospect within the Rockford Project in WA’s Fraser Range, including three intercepts totalling 12.4-metres.
These three massive sulphide intercepts were within 21.6 metres from 217.5 metres in the lower interval of diamond hole RKDD011.
In the wake of the new drill results, Euroz Securities has increased its price target for Legend from 20 cents per share to 30 cents (current share price: 18 cents).
Following is an extract from Euroz’s research update on Legend:
Material Assays & Further Intercepts: Mawson Taking Shape
Investment case
The second Mawson hole has delivered material assays and now a third hole has found a similar sequence of sulphides 20m to the north. High grade Ni, Cu and Co with precious metals credits supports in situ values north of US$500/T of ore. The discovery of thick zones total up to 42m of massive and semi-massive Ni-Cu-Co sulphide mineralisation within a broader 145m package that includes 90m of mineralisation should be viewed as highly material. And given the aerial geochem footprint of some 200x300m, we are hopeful further intercepts will be defined in the current (at least) 6 hole diamond programme. LEG has $13m in cash and receivables and a further c.$9m of options in the money so is very well funded to execute the current programme. Further drilling success will materially re-rate the stock. We are reviewing Price Target and Valuation (prev. 20cps) in light of the new success however, further positive results will see continued upward trajectory given SIR. ASX was sold eventually for c.A$1.8Bn for its Nova-Bollinger discovery. Speculative Buy maintained. We increase our Price Target to $0.30/sh: with on-going drilling, geophysics and model coming together, we think LEG has momentum and plenty of newsflow to drive share price higher.
Key points
- The follow-up hole (RKD008) located 70m south of the Mawson discovery hole (RKDD007) tested a 6-8000 Siemens off-hole conductor, interpreted to be 80m down-dip of the discovery;
- The hole encountered 5 significant intervals of semi-massive to massive sulphides totalling 41.5m in aggregate;
- The deepest zones comprise c.25m of massive sulphide, that graded +2.5%Ni; +1.3% Cu; +0.14% Co; plus Au, Pt, Pd;
- At spot prices, a tonne of this ore would equate to over US$500/T in situ;
- As a comparison, the current Nova Reserves = 1.9% Ni; 0.8% Cu; 0.07% Co or circa US$300/T of in situ value;
- The 4th hole in the current program (RKDD011) has also encountered massive sulphides in three zones if 12.4m in aggregate over 22m section from 217.5m downhole;
- An upper 15m of vein thru semi-massive sulphides occurs from 130m downhole;
- The Company will undertake Down-Hole ElectroMagnetic surveys before independent structural interpretation of the core and assays (expected mid-May);
- Two other holes (RKDD009 and RKDD010) also found evidence of non-economic sulphides. However the holes have assisted the application of geophysics and vectoring the ongoing exploration drilling towards a large gravity feature and associated geochem anomaly to the NNE;
- The Company is well funded with $13m in cash and receivables and a further $19m of options in the money;
- We set our Valuation at $0.26/sh (prev. $0.20/sh);
- We increase our Price Target to $0.30/sh: with on-going drilling, geophysics and model coming together, we think LEG has momentum and plenty of newsflow to drive share price higher;
- Further success with the current program will see the stock gap-up: Speculative Buy maintained.