It’s hard to understate just how valuable the prize that Kavango Resources PLC (LON:KAV) is chasing at the Kalahari Suture Zone project could be.
If the geological interpretation that the company has put together is right - and the data to support the interpretation is extensive – then the KSZ could turn out to be a mineralised orebody of a kind seen only rarely in the world, at sites like Voisey’s Bay, Norilsk and Jinchuan.
For those not in the know, those same sites play host to some of the biggest mines in the world, with dollar values running into the billions, and mine lives that still stretch out decades.
If it’s so good, though, why hasn’t the Kalahari Suture Zone been developed before?
The answer is simple enough: it lies under a covering of Kalahari sands in Botswana, and until very recently has been very hard to gather data on.
But advances in remote sensing technologies over the past couple of decades have allowed mining exploration companies to look underground in ways that the old timers who discovered Norilsk and Voisey’s Bay could only have dreamed of.
It’s still an art to some degree, but the science is getting better and better all the time. What’s more, since mineralisation at the KSZ has been known about for several decades, there’s also a significant amount of historical data that can be reinterpreted using the new methods, and which can be tied in to data gleaned from water boreholes.
It all adds up to a significant body of knowledge that towards the end of last year allowed Kavango to build a three-dimensional model of what the orebody seems to look like.
“We have drill cores from Canadian drilling programmes conducted in the 1980s and 1990s,” explains Kavango executive director Ben Turney.
“We also have water boreholes, the data from which has been surprisingly valuable.”
What the data seems to show is that around 180 million years ago a significant geological event occurred in which molten magma passed through a sizeable coal deposit, the sulphur in which melted into a magmatic mix to form magmatic sulphides.
So far, so good. This is the pattern seen at Norilsk, and bodes well. The borehole data is spread out geographically, and thus gives a good indication of how extensive the spread of the magma was.
In the resulting 3-D model, the system takes the shape of what’s termed a “gull and keel” formation, where a significant part of the orebody runs vertically, with its richest portion at the base, or keel, while at the top there are also sizeable lateral extensions in the shape of gull wings.
This, too, is the pattern seen at Norilsk.
The trick for Kavango now, though, will be to turn this multi-billion dollar vision into reality. And given the Kalahari sands, that won’t be easy.
Most recently, the company conducted a time domain electromagnetic survey, also known as TDEM, to provide additional data with which to cross-reference the 3-D gull and keel model,
“The surrounding bedrock is more resistive,” explains Turney.
“If we can identify one of these highly conductive anomalies, and if it corresponds with the gull and keel model, we will drill.”
The results from the first TDEM surveys are expected imminently, and the company knows both what it is looking for and where to look.
“According to our model, the best positions for any conductors we identify would be at the bottom the keel formations, or along the dipping rock walls,” says Turney.
“In other systems, some of the richest parts of any orebodies discovered are on the rockwalls of the keels, so we are paying particular attention to those.”
It’s still high risk, of course, and until Kavango actually has drill cores logged and assayed, nothing will be certain.
“The goal for 2021 is proof of concept,” says Turney.
“If we can prove the existence of magmatic sulphides then that opens up the potential of the entire system. We’ve found nothing to disprove our hypothesis so far, which is particularly encouraging given how rigorous a scientific approach we’ve adopted.”
In the meantime, Kavango will also go to work on its other major area of operations in Botswana, up in the copper belt. This is an area where prospectivity has already been proven by the likes of Metal Tiger (LON:MTR), Sandfire Resources (ASX:SFR) and Cupric Canyon.
Kavango has two separate strands to its copper belt activities. There’s a joint venture with Power Metal Resources (LON:POW), which is likely to be spun out into a separate entity by the end of the first half of the year, and there’s a separate licence which the company will keep in-house.
Airborne surveys on the copper took place in February, and it will be interesting to watch for the results from those, as and when they come out.
Overall, Kavango is well-funded, having raised £2mln in November of last year, and can cover all its 2021 work programmes and see itself into 2022. That gives it an enviable flexibility when operationally, as well as at a strategic level.
Because there’ll likely come a time, whether sooner or later, when a major mining comes knocking at Kavango’s door looking for a deal. If Kavango continues to be well supported in the market and well funded, and has a stack of successful exploration results under its belt, it should be in a strong position to cut the best possible deal for shareholders.
As always, though, the drillbit will be the ultimate arbiter.