VSA Morning Miner, 25/02/21
Tectonic Gold (AQSE:TTAU)
Tectonic Gold (AQSE:TTAU) has announced an update on Specimen Hill and its Deep Blue diamond JV. Maximising access to Australia’s leading academic knowledge in geology has always been a central feature of TTAU’s approach to exploration with the company benefitting from close collaboration in its use of deep penetrating geophysics and other techniques. Today’s announcement about the collaboration with the Centre for Ore Deposit and Earth Sciences (CODES) of the University of Tasmania highlights that further.
Chemical signals of minerals such as tellurium and bismuth are useful indicators of alteration associated with IRGS and TTAU’s current work with CODES builds on the company’s current understanding of how such signals are modified depending on the position within the system. TTAU states that it is helping that drilling results and subsequent analysis is providing information that indicates the source of the IRGS or high grade core. We believe that this will help TTAU to position deeper drill holes testing beyond the recent c120m depth that was tested continuing TTAU’s track record of targeted and successful drilling.
On diamonds, TTAU has 20mn shares as well as options in Kazera Global listed on AIM which is the operator on the Deep Blue diamond JV in South Africa. Now in production, this gives TTAU an interest in mine production and potential cashflow. First production in December achieved 50ct of diamonds and now 220ct cumulatively demonstrates successful production ramp up. Initial production in December included stripping and now further improvements are expected in due course.
We reiterate our Speculative Buy recommendation.
Oliver O'Donnell, CFA, Head of Research & Natural Resources Analyst | T: +44 (0)20 3617 5180 | E: oodonnell@vsacapital.com
Paul Renken, Senior Geologist | T: +44 (0)20 3005 5011 | E: prenken@vsacapital.com
VSA Capital Research | T: +44 (0)20 3005 5000 | E: research@vsacapital.com
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