As a must-watch energy metals play entering 2022, Renforth Resources Inc. (CSE: RFR) (OTCQB: RFHRF) (FSE: 9RR) this week delivered two pieces of news to lift shareholders’ spirits during the holiday season.
First, the Canadian miner secured a financing of more than C$1.37 million to assist the development of its Surimeau battery metals prospect in Quebec. Funds will also be used to advance the company’s Parbec gold deposit, also located in Quebec.
The financing involves the issuance of 13.75 million flow-through common units plus 14,000 common units of the company.
The second news, and perhaps the more significant one, is the successful completion of drilling at Victoria West, one of the five polymetallic target areas on the Surimeau property.
A total of 7 holes for 1,203m were completed during the latest drill program. This was designed to follow up on the successful stripping of the Victoria West system, which unveiled nickel, copper, cobalt and zinc mineralization at surface.
Drilling took place in the two areas where the strongest visual mineralization was exposed, in the eastern and the western ends of the 275m stripped strike length.
Importantly, each of the holes encountered visible sulphides. Samples have been sent for assay, and results will be released in due time.
Renforth is also waiting on results from the recently completed channeling of the stripped area. In addition, a geophysical survey is planned for the entire 20km magnetic feature at Victoria West, which would provide the company with a more detailed interpretation of the structure.
Surimeau Battery Metals Project
Transitioning into the era of clean energy entails an unprecedented surge in demand for minerals necessary to electrify the transportation system and build new green infrastructure. This presents an opportunity for companies that have already joined the hunt for these “future-facing” minerals.
At AOTH, we believe Renforth has the right metals at the right time, embodied in its Surimeau polymetallic project in Quebec.
This 260 sqkm property hosts several target areas for industrial metals (nickel, copper, zinc, cobalt) located south of the Cadillac Break, a major regional gold structure.
Exploration focus is currently placed on the sulfide nickel rich VMS targets, in particular the Victoria West prospect, which is the site of drilling by the company for over a year (see map below).
The Victoria target was last explored in the 1990s by LAC Minerals looking for gold, though it was later determined by LAC and previous operators that nickel, zinc and copper, plus a few more minerals, are also present. This finding was later validated by Renforth’s initial fieldwork.
According to Renforth, information gleaned from drilling and trenching the Victoria West target, along with surface sampling, creates an area of interest that includes about 5km of strike on the western end of a 20km magnetic anomaly.
The company interprets this anomaly to be a nickel-bearing ultramafic sequence unit, which occurs alongside, and is intermingled with, VMS-style copper-zinc mineralization.
Renforth considers the style of mineralization to be an “Outokumpu-like” occurrence, referring to a district in eastern Finland known for several unconventional sulfide deposits with economic grades of copper, zinc, nickel, cobalt, silver and gold (see below).
About 50 million tonnes of ore averaging 2.8% Cu, 1% Zn and 0.2% Co, along with traces of Ni and Au, were mined from three deposits between 1913-1988.
Renforth’s first drilling at Surimeau occurred in October 2020, with 2.5 short holes completed.
Then in spring 2021, a total of 15 holes for 3,456m were completed, drilling off 2.2km of strike within the approximately 5km long Victoria West target. Another four holes totaling about 1,000m were drilled in summer; these holes all delivered visible sulfides in the core.
Assays for the 21 holes drilled at Victoria West were announced last month, with each hole hitting mineralization as expected, and the four deeper holes even demonstrating an increase in grade.
Highlights of the 2020-2021 drilling included:
Since then, 7 new holes have been drilled by the company within an approximate 275m stripped strike of the Victoria West area, results of which will surely add to those promising results.
The recently concluded stripping encountered much more copper and zinc on surface than was seen in the drilling.
According to Renforth, this is thought to be due to the variable presence of the ultramafic nickel/cobalt body and the magmatic copper/zinc body, consistent with the company’s “Outokumpu-style” model that suggests two different mineralized bodies juxtaposed in one location due to the circumstances of the mineralizing event.
While still at a very early stage, Renforth considers the extent of its findings to date, plus other known targets and unexplored prospective ground, warrant further, more detailed exploration on this 260 sqkm property.
Victoria West is only one of six polymetallic target areas on the Surimeau property historically documented as hosting mineralization. It is located at the western end of a 20km long magnetic anomaly that hosts proven mineralization at either end, with the Colonie target at its eastern end.
The fourth and latest to be prospected is the Huston area, located at the western end, about 18 km from Victoria West. This area is almost entirely unexplored with the exception of a limited drill program in the general area by Hecla in the 1980s, which focused on gold.
Results of this summer’s prospecting from the southwestern part of the area gave the first ever documented nickel occurrence at Huston, with one grab sample returning 1.9% Ni, 1.38% Cu, 1,170 ppm Co and 4 g/t Ag. Management considers this sample, which was taken from strongly foliated diorite, a coarse-grained intrusive igneous rock, to be a new discovery that will be revisited.
The company also has plans to investigate the 14km of magnetic anomaly between Victoria West and Colony to determine the continuation of the ultramafic mineralization at Surimeau.
Parbec Gold Project
Surimeau represents Renforth’s first exploration for nickel, copper and cobalt, minerals that all play critical roles in the clean energy transition. Its work to date has given us a glimpse of the project’s potential for exciting new battery metals discoveries.
The company has also been focusing on gold exploration in Quebec, in particular at the Parbec project. Parbec is an open-pit gold deposit sitting on 1.8km of the Cadillac Break, located next to Canadian Malartic, Canada’s largest gold mine.
The May 2020 pit-constrained resource estimate showed 104,000 indicated ounces at 1.78 g/t Au and 177,000 inferred ounces at 1.78 g/t Au. Since then, Renforth has completed over 15,000m of drilling at Parbec, with positive results received to date. The latest assay results had 3.06 g/t gold over a thickness of 21.85m.
The company is currently preparing a structural site characterization of Parbec, the first phase of which will occur in January 2022, consisting of compilation and integration of all relevant data and a gap analysis.
Bank of America forecasts that, given the current rate of EV penetration, as much as 690,000 tonnes of nickel will be needed by 2025 to build car batteries. That figure represents nearly the entire mined nickel supply of Indonesia, the world’s top producer, which in 2020 outputted 760,000 tonnes.
In short, a nickel supply shortfall is looming, and it is up to mining companies to make new discoveries as soon as possible to avoid a decade-long market deficit.
This is where the Surimeau district property comes in. The nickel sulfide deposit at surface, and potentially at depth, is just starting to reveal its secrets to the market.
Just how large the system is remains to be seen, as further exploration over unrest ground is required to determine the full extent of this mineralization.
CSE:RFR, OTCQB:RFHRF, FSE:9RR
Shares Outstanding 262.3m
Market cap Cdn$19.7m
Richard (Rick) Mills
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