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Impact Minerals receives speculative buy from Perth broker

Published: 08:00 28 Sep 2015 AEST

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Impact Minerals (ASX:IPT) has been rated a speculative buy in a research note by Patersons Securities.

The company has a solid start to drilling at its promising copper-nickel-platinum (PGM) joint venture project near Broken Hill in New South Wales with the first two holes encountering further oxide and sulphide copper-nickel mineralisation.

Following is an extract from the report:


Impact Minerals Limited (IPT) has secured funding and technical support from cornerstone investor Squadron Resources (part of Andrew Forrest’s Minderoo Group).

Squadron has agreed to invest up to $7.3 million to fund the company’s aggressive exploration plans.

This welcomed capital injection, coupled with the recently completed $1.9 million Entitlement Issue, will allow systematic exploration to continue across all IPT’s projects, in particular at Broken Hill (IPT 87%) where the company recently announced some of the highest grade Platinum Group Metals drill results in Australia.

Follow-up drilling has commenced with results expected shortly.

IPT also has the Commonwealth Gold project in NSW and Mulga Tank Ni-Cu project in WA, where drilling is expected to commence in the next Quarter.

We are initiating coverage of IPT with a Speculative Buy rating.


Squadron Injects Up to $7.3m; Adds Technical Clout


Cornerstone investor, Squadron Resources has agreed to fund up to $7.3 million in IPT.

This is important in the current market where funding for junior resource companies is tight.

Tranche 1 ($2 million) is complete, and consists of $2 million in convertible notes and 45 million options exercisable at 3.25 cents per share ($1.5 million).

Tranche 2 ($1 million) consists of a placement at 2.1 cents per share and 26.4 million options at the same terms as tranche 1 ($0.86 million).

Squadron Resources also has the option to invest a further $1 million in IPT’s Broken Hill and/or Commonwealth projects.

The appointment of Dr John Clout as technical advisor provides IPT with additional intellectual advantage.

Mr Aaron Hood, Minderoo’s Chief Investment Officer, has been appointed to the IPT Board.

Shareholders will vote on the Squadron Resources investment at the Company’s Annual General Meeting (AGM) on 29th September 2015.


High Grade Platinum Project Shows Significant Promise; Drilling Underway


We see the Broken Hill project as having significant potential for a high grade platinum discovery.

The project has a 40 kilometre long belt of ultramafic rocks with numerous high grade platinum occurrences at surface.

The three priority targets are Red Hill, Platinum Springs and Moorkai.

The Red Hill prospect is located some 20 kilometres from the Broken Hill Lead-Zinc-Silver mine in NSW which has produced for over 100 years.

Red Hill was a previous small copper-platinum mine which operated from 1906 to 1937.

Drilling conducted by IPT under the historic mine returned minor massive sulphides from 58 metres with a drill hole of 32 metres at 1% Cu, 0.5% Ni, 3.9g/t Pt-Pd-Au and 10.6g/t Ag.

Drilling is currently underway to test seven targets at the Red Hill prospect.

A 120 kilogram sample from a gossan at Platinum Springs returned 19.6g/t Pt, 50g/t Pd and other associated PGM’s as well as nickel and copper. This is close to a mineralised drill hole.


Commonwealth Au-Ag-Base Metal Project, NSW (IPT 100%)

The Commonwealth project is a high grade gold-VMS project with potential for small-scale early production.

The project is located approximately 100 kilometres north of Orange in NSW and is situated in the prolific Lachlan fold belt.

In early 2015, IPT released a maiden Inferred Mineral Resource of 720kt at 2.8g/t Au, 48g/t Ag, 1.5% Zn, 0.6% Pb and 0.1% Cu.

Further drilling is planned for early 2016 which will target potential extensions to the mineralisation.


Mulga Tank Ni-Cu Project

IPT is targeting very large nickel deposits (e.g. Mt Keith, Perseverance) at its Mulga Tank project, 200 kilometres east of Kalgoorlie.

The area is highly underexplored with four of six targets tested by IPT returning high grade nickel and copper in komatiites, veins and dunite.

Further drilling is planned in the December Q 2015.


Catalysts

- Broken Hill 1,500 metres Diamond Drill Program underway first results due early October.
- December Q 2015 Mulga Tank 5,000 metre drill program planned.
- March Q 2016: Commonwealth Drill program.

 

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