(MENAFN- ProactiveInvestors - Australia) Spectrum Rare Earths (ASX:SPX) has commenced diamond drilling to explore for primary Magnetic End Use Rare Earth mineralisation below existing surface assays at its Skyfall Prospect in the Northern Territory.
This will be closely watched given the rare earth mix at Skyfall has an unusually high distribution of valued Magnetic Rare Earths (MEU REO) compared to other prospects around the world.
Drilling targets primary or feeder mineralisation below the surface Exploration Target of 17 to 21 million tonnes at 0.4-0.6% Total Rare Earth Oxides (38% MEU REO).
Three holes targeting the Northern, Central and Southern areas along a 6 kilometre strike length over the prospect where geology and geochemistry have indicated optimum locations.
Drilling, which is partially funded by a Northern Territory Government Drilling Collaborations grant of $20,000, is expected to take about one month complete with up to 1,000 metres of drilling planned.
Skyfall
The Skyfall Prospect is located about five hours drive south of Darwin in a district that is home to multiple heavy and magnetic end use rare earth prospects.
It sits above a major fault corridor adjacent to an interpreted large, deep seated granite body that is conceptualised to have provided the original REE source, and major faulting has acted as a conduit for fluid circulation and the transport of mineralisation to the surface.
Skyfall contains an unusually high distribution of Magnetic Rare Earths when compared to other rare earth prospects around the world.
Magnetic Rare Earths are experiencing the strongest growth rates across the sector due to their demand in efficient energy technologies, primarily in the automobile industry.
Demand had hit almost 120,000 tonnes in 2013 and is expected to grow to more than 160,000 tonnes in 2016.
Recent near surface mineralogy at Skyfall has also identified secondary rare earth minerals including crandallite.
Notably, crandallite group minerals are known secondary minerals associated with intrusive controlled rare earth deposits such as Mt Weld.
Its presence in the weathered zone at Skyfall, in association with high neodymium distributions, supports Spectrum's interpretation of a potentially higher grade mineralised stock or feeder system beneath this surface zone.
Analysis
Spectrum Rare Earth's drilling at Skyfall will be closely watched given the size of the primary Magnetic End Use Rare Earth mineralisation below existing Exploration Target of 17 to 21 million tonnes at 0.4-0.6% Total Rare Earth Oxides (38% MEU REO).
Upcoming share price catalysts include drilling results as well as trial pit samples being tested to investigate lower cost mineral processing options; and mineralogy and metallurgical results that are also due in coming weeks.
Proactive Investors sees potential strong price growth from current prices of $0.050 to $0.12-$0.16 within 12 months.
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