TIDMKAV
RNS Number : 5600K
Kavango Resources PLC
23 April 2020
PRESS RELEASE
23 April 2020
KAVANGO RESOURCES PLC
("Kavango" or "the Company")
Ongoing project progress in Botswana, and Covid-19
Kavango Resources plc (LSE: KAV), the exploration group
targeting the discovery of world-class mineral deposits in
Botswana, is pleased to provide an update on recent progress across
its portfolio of three projects: the Kalahari Suture Zone ("KSZ");
the Kalahari Copper Belt ("KCB") and Ditau; and Covid-19.
Highlights
v Kalahari Suture Zone
- Kavango's 10 prospecting licenses ("PLs") cover a substantial
portion of the 450km strike length of the KSZ ( 5,580 km(2) ) (the
"KSZ Licenses).
- The KSZ's regional geology bears distinct similarities to world-class magmatic sulphide Copper-Nickel-Platinum Group Metal ("PGM") deposits at Norilsk (Siberia) and Voisey's Bay (Canada).
- Following the successful 2019 drilling campaign, the Company
and its independent consultants are now constructing a computerized
3D underground map (model) of the northern part of the KSZ project
area (the "3D Underground Model").
- The goal is to identify future high-priority drill targets
- Data from multiple sources are being incorporated into the
model including results from the recent drilling, ground geophysics
and airborne surveys, as well as third party drilling data from
other mineral exploration efforts and water bore holes.
- Dr David Holwell, a leading authority on magmatic sulphide
deposits and a Professor at Leicester University in the UK, has
recently carried out a detailed independent mineral systems review
and the economic potential of the KSZ Licenses.
- The Company is now fully funded for the next phase of exploration work at the KSZ.
v Kalahari Copper Belt ("KCB")
- Further PLs under review to be included in the Kalahari Copper
Belt Joint Venture (the "KCB JV")
- Kavango also assessing other PLs, with a view to taking 100% direct interests
- Ongoing desktop examination and compilation of historical
exploration data, reports, maps and research papers, including soil
sampling results, airborne electro-magnetic surveys, drilling data
from exploration and water boreholes over the entire Botswana
segment of the KCB.
v The Ditau Project ("Ditau")
- Following the announcement in 2019 that Kavango was seeking a
Joint Venture partner for the Ditau Project, Power Metal Resources
(LSE:POW) ("Power Metals") is conducting due diligence in
anticipation of completing the acquisition of a 51% interest in
Ditau (15 April 2020) where the Company holds 2 PLs (1,386 km(2)
)
- Planned orientation work on the Falconbridge carbonatites (the
"Falconbridge Orientation"), 25km to the north of Ditau:
- 3 carbonatites were discovered in the 1970s by Falconbridge
Exploration Ltd. These now lie within a De Beers diamond
exploration license
- De Beers has granted Kavango site access to its license area,
subject to adoption of an environmental management plan
- Non-invasive geophysical work is planned, subject to Power Metals' agreement
- The Falconbridge Orientation will be designed to guide future
exploration of the "10 ring structure" magnetic targets thought to
represent carbonatites at Ditau.
v Covid-19 update
- Minimal disruption so far to the Company's operations with
recent work focused on analysis and modeling of all data collected
over the last 18 months.
Michael Foster, Chief Executive Officer of Kavango Resources,
commented:
"Following completion of our recent strategic financing, we are
extremely pleased to report on the progress we have made over
recent months. We have kept dilution to a minimum, as we now enter
the next crucial phase of exploration across our portfolio of
projects.
Our goal is to discover world-class metal deposits in Botswana.
Thanks to the evidence we have gathered in the field from surveys
and drilling we are well positioned to build sophisticated
geological models to hone future high-priority target
selection.
We are particularly encouraged by the initial results we've seen
from Dr Holwell's report and look forward to providing a
comprehensive update on this soon."
A glossary of geological terms is provided at the end of this
announcement.
Kalahari Suture Zone Further Exploration
On 2 December 2019 Kavango announced that its most recent
drilling programme in the KSZ had identified a magma plumbing
system within the Karoo sediments. This was a significant step
forward for the Company in its search for "Norilsk-Style"
Copper-Nickel- PGM deposits.
The Norilsk mining centre is about 2,800km northeast of Moscow
and accounts for 90% of Russia's nickel reserves, 55% of its copper
and virtually all of its PGMs. Kavango's licenses in the KSZ
display a geological setting with distinct geological similarities
to the magmatic sulphide deposits at Norilsk. Magma plumbing
systems are a key feature of these deposits.
Typically, magma plumbing systems are composed of stacked
horizontal sills connected to each other via vertical dykes.
A continuous flow of magma (containing "free" sulphur) through a
magma plumbing system may have allowed the accumulation of metal
sulphides in certain trap sites within the sills. This is because
metal sulphides are heavy and tend to sink to the bottom of
magma.
Over time, accumulations of metal sulphide could have led to the
formation of economic deposits of Copper-Nickel-PGMs.
The d ata from the drilling campaign is now being incorporated
into a computerized 3D Underground Model (an underground map) by
the Company and its consultants. The 3D Underground Model also
incorporates data from ground geophysics and airborne surveys, as
well as third party drilling data from other mineral exploration
programs and water boreholes.
The construction of the 3D Underground Model of those areas
within the northern section of the KSZ that show the development of
a high-level plumbing system will allow Kavango to identify "trap
zones" within the intrusives (sills) that have the potential to
host metal sulphide mineralization. Those zones will be tested with
ground based EM surveying using high powered transmitters that are
designed to penetrate conductive overburden and saline ground
water. A contractor for this work has already been identified.
Kavango is fully funded for this next phase of development at
the KSZ.
KSZ economic potential report
In parallel to further exploration work, the Company has
commissioned Dr David Holwell to complete a comprehensive
independent review of the minerals systems and the economic
potential of the KSZ Licenses.
Dr Holwell is a leading authority on the development of
Copper-Nickel-PGM magmatic systems, with over 40 peer-reviewed
publications to his name.
The Company expects to release the findings of the report in the
coming weeks.
The Kalahari Copper Belt
Further to the announcement on 17 February 2020, when the
Company confirmed it had signed a Joint Venture with LVR
GeoExplorers (Pty) Ltd ("LVR") with respect to two PLs in the
Kalahari Copper Belt, Kavango has continued to assess further
prospecting licenses.
The Company is currently considering additional licenses in the
KCB either for inclusion within a KCB JV or to by making fresh
applications in its own name.
Kavango will make further updates on this in due course.
Ditau update
Further to the announcement on 15 April, Power Metals is
conducting due diligence, in expectation of completing its
acquisition of a 51% interest in the Ditau Project.
The Ditau Project comprises 2 prospecting licences (PLs), which
cover an area of 1,386km(2) . Kavango originally identified a large
7km by 5km magnetic anomaly on the first of these two licenses,
which presented an attractive exploration target.
Subsequent onsite exploration and drilling led the Company to
recognise 9 additional geophysical "ring structures", which are
thought to represent structures related to carbonatite magmatism.
Carbonatites are the primary source of niobium and Rare Earth
Elements ("REE").
In the first half of 2019, the Company completed the drilling of
two exploration holes. Assay results from these, released last
August, confirmed the presence of alkali metasomatism
(fenitisation), which is associated with the emplacement of
alkaline intrusives into the overlying Karoo sediments. This is a
geological indicator of the presence of carbonatites.
Subsequently Kavango learned that in the early 1970s, while
undertaking diamond exploration in the area, Falconbridge
Exploration Ltd discovered 3 carbonatites that now lie within a
diamond- exploration license area, owned by De Beers, 25km to the
north of Ditau. Significantly, the carbonatites were reported by
Falconbridge to lie immediately below the Kalahari (sand) cover.
They are therefore "post Karoo" and not deeply buried.
The presence of the 3 "Falconbridge" carbonatites provides an
opportunity for Kavango to undertake orientation tests, which will
assist in the calibration of the Company's geophysical equipment in
the surveying of the 10 Ditau targets.
De Beers has granted the Company physical access to the
Falconbridge carbonatites, subject to adoption of its environmental
management plan.
The Company expects that the Falconbridge Orientation program
will commence upon completion of Power Metals' due diligence
(Covid-19 dependent). In the meantime, the Company will prepare the
necessary paperwork and adopt De Beers' environmental management
plan.
Covid-19
Botswana is currently into the third week of a 28-day lockdown
in response to Covid-19. This has caused disruption to field work
at Kavango's operations. However, as described above, most of the
Company's efforts are now focused on analyzing and interpreting
existing data to guide future exploration plans.
Due to the lockdown in the UK and Botswana, and under the
temporary relief statement announced by the FCA on 26 March 2020,
Kavango expects to publish the audited financial statements for the
year ended 31 December 2019 in May 2020.
Kavango will provide further updates concerning its operations
in relation the Covid-19 response if it becomes necessary.
New date for Admission of Placing Shares
As previously announced on 15 April 2020, the Company agreed to
issue 27,250,000 new ordinary shares (the "Placing Shares") at a
price of 0.8p per share to raise GBP218,000 (the "Placing").
Admission of the Placing Shares to the Standard List segment of the
London Stock Exchange ("Admission") was expected to take place on
21 April 2020.
It is expected that Admission will now become effective and that
dealings in the Placing Shares will commence at 8.00am on, or
about, 28 April 2020.
Further information in respect of the Company and its business
interests is provided on the Company's website at
www.kavangoresources.com and on Twitter at #KAV.
For further information please contact:
Kavango Resources plc +44 20 3651 5705
Michael Foster
mfoster@kavangoresources.com
SI Capital Limited (Broker) +44 1483 413500
Nick Emerson
NOTE TO EDITORS AND GLOSSARY OF TERMS:
THE KALAHARI SUTURE ZONE
Kavango's 100% subsidiary in Botswana, Kavango Minerals (Pty)
Ltd, is the holder of 12 prospecting licences covering 8,324.7km(2)
of ground, including 10 licences over a significant portion of the
450km long KSZ magnetic anomaly in the southwest of the country
along which Kavango is exploring for Cu-Ni-PGE rich sulphide ore
bodies. This large area, which is entirely covered by Cretaceous
and post-Cretaceous Kalahari sediments, has not previously been
explored using modern techniques.
The area covered by Kavango's KSZ licences displays a geological
setting with distinct similarities to that hosting World Class
magmatic sulphide deposits such as those at Norilsk (Siberia) and
Voisey's Bay (Canada).
KSZ DEFINITIONS
When a deposit consists almost entirely of sulphides it is
termed "massive". When it consists of grains or crystals of
sulphide in a matrix of silicate minerals, it is termed
"disseminated".
Gabbro/gabbroic: A coarse grained, medium to dark coloured rock,
formed from the intrusion of mantle derived molten magma into the
earth's crust.
Gabbroic sills: Relatively thin, planar bodies of solidified
gabbroic magma that intruded into layers of sedimentary rock whilst
still molten.
High-level sills: Are sills that are emplaced in the upper
levels of the earth's crust, close to the surface.
Sulphide mineralisation : If there is sufficient sulphur in the
molten magma, it will tend to combine with metals (Cu, Zn, Ni, Co,
Pb, PGEs etc.) to form metal sulphide complexes, which may coalesce
to form massive sulphide deposits. If the melt is sulphide poor,
the metals will be taken up into the silicate minerals that form as
the magma cools and will not usually form economic deposits.
Primary sulphides: Are sulphide complexes (or crystals) that
form as the magma cools and are composed of elements that are
present at the time of initial crystallization. Secondary sulphides
may form after the magma has solidified either by the introduction
of new elements into the rock or by re-mobilising elements already
present through changes in pressure, heat etc.
ECONOMIC POTENTIAL OF CARBONATITES
Until recently carbonatites were regarded as unusual and
academically interesting geological bodies but significant interest
was only generated once the demand for Rare Earth Elements ("REEs")
was established (in the last few years). Hitherto many carbonatites
were mined for their phosphate content (fertilizer), or for
economic deposits of Niobium, Strontium, Uranium, Thorium,
Magnetite, Barium and Vermiculite. One of the world's most
productive carbonatites, Palabora, has been in production
continuously since 1953 and is South Africa's principal source of
copper. About one out of nine carbonatites world-wide have been
mined commercially (Simandi & Paradis 2018).
Both the market and production of REE's is dominated by China
who are also leading the research into the technological
application of these metals. Western countries have recently become
alarmed about the strategic advantage that China now exerts over
REE technology such that new deposits of these elements are in high
demand.
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