Savannah Resources (SAV.L) released drill results from the ongoing drill program at the Block 4 and Block 5 properties in Oman, where it’s earning a 65% stake in Block 4, and already owns a 65% stake in Block 5.
The company has drilled some shallow holes (6 holes for a total of 608 meters), but the assay results were a positive surprise. At Block 5, the Mahab 4 zone returned 15.2 meters of 4.02% copper and 0.2 g/t from a depth of just 62.5 meters, whilst at the Maqail South zone, the drill bit intersected 25.6 meters containing 2.66% copper and 0.1 g/t gold. According to the company, these drill results indicate the current resources of 1.7 million tonnes containing 2.2% copper could be expanded. We think this would definitely be necessary to increase the chances of the project being developed, as the current resource base of less than 100 million pounds of copper might not be sufficient to warrant the development of the project. Savannah seems to be very confident it could develop a profitable copper mine, as the company now also submitted two mining license applications to the relevant authorities in Oman.
However, the high-grade mineralization could potentially be blend with ore from the Bayda zone, where the company has outlined a larger, but lower grade target after encountering 33.4 meters of 0.69% copper. Drilling should be completed by now, and it will be interesting to see how much copper the updated resource estimate (to be released in Q4) will contain. In any case, this is a very intriguing project, but the main question of how safe and easy it is to work in Oman will always play an important role.
Go to Savannah’s website
The author has no position in Savannah Resources. Please read the disclaimer
