Solid Resources (SRW.V) - major drilling programme results

Comment by Objective Capital , Oct 13, 2011
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Solid Resources has released a summary of its major drilling programme at Doade Presqueiras in northwestern Spain that ran from January to June 2011.

A total of 3,364 metres were drilled in 31 holes, producing continuous core with a recovery of nearly 100 percent. A key part of the programme occurred in the Presqueiras area, where infill and step-out drilling expanded the mineralised area to approximately 750 metres by 350 metres.

In at least four of the five other areas drilled in 2011, significant amounts of tantalum, tin, niobium and lithium were encountered. In the southernmost end of the permit, known as Taboazas, an area of approximately 400 metres by 150 metres was drilled, confirming the continuity of several hundred metres of mineralised dykes with encouraging grades of tantalum, tin, niobium and lithium. The Taboazas area remains open to the north and south.

Management now believes the Doade-Presqueiras deposit is considerably larger than previously thought. The results confirm the mineralised pegmatite dikes are continuous over 11 kilometres, in a north-northwest-to-south-southeast direction. The mineralised rock is primarily cassiterite, containing tin, and columbo-tantalite, containing tantalum and niobium, as well as spodumene and petalite, containing lithium.

All 31 drill holes in the 2011 campaign intersected mineralisation with thicknesses from 1.5 metres to 15.6 metres in the main dykes. Six other mineralised dykes have been identified, approximately parallel to the principal dykes, and with thicknesses between 0.60 metres and 11.55 metres.

In the northernmost and best-known area, Presqueiras, the zone with the highest grades of tantalum and tin are farther east than previously thought, with good continuity from north to south. A new drill programme is scheduled for next year to expand the resource further.

Management now estimates the average metal contents of the deposit at 150 grammes per tonne of tantalum, 800 grammes per tonne of tin and approximately 1percent lithium, assuming an appropriate, selective mining operation is carried out. The maximum grades to date are: 293 ppm tantalum, 2,930 ppm tin, 191 ppm niobium and more than 2 percent lithium.

Objective's view:

We believe the results of the 2011 drilling programme are in line with our recently completed initiation note and confirm our base-case and optimistic valuations of Solid Resources and Doade-Presqueiras.