Lincoln Minerals Ltd (ASX:LML) is an Australian company with a portfolio of high-quality uranium, iron ore, base metal (lead-zinc-copper-nickel-silver), gold and iron oxide copper gold uranium (IOCGU) exploration projects in the Gawler Craton, South Australia.
The company on Monday released results from the first aircore and slimline RC drilling program on its Gum Flat iron ore project, EL 3422, near Port Lincoln.
Highlights included:
* Hematite-rich banded iron formation containing intersections up to 52.6pc Fe;
* Large exploration target with at least 5km strike length of high-amplitude magnetic anomalies and associated folded iron formation; and
* Relatively shallow cover within 20km of existing infrastructure.
Eight zones of significant iron (Fe) mineralisation have been defined within a sequence of folded Banded Iron Formation (BIF) and overlying locally pisolitic ferruginous sediments.
These occur along a series of aeromagnetic anomalies with a cumulative strike length of around 30km but including 5-6km of high-amplitude magnetic anomalies.
At the Rifle Range prospect, there were several drill intersections averaging better than 30pc Fe.
GFAC033 intersected 33m of hematite BIF averaging 42.1pc Fe from 18-51m including 18m @ 47.8pc Fe from 24-42m. This was an angled hole so the true depth to the top of mineralisation, and hence thickness of cover sediments, is only 15-16m.
GFAC060, 1.2 km along strike to the south, intersected similar hematite mineralisation including 6m @ 52.6pc Fe from 30-36m. The average depth of drilling was 50-60m.
SHARE PRICE MOVEMENTS
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The shares fell 14c to 20c yesterday after the results failed to measure up to expectations. Rolling high for the year to date is 39.7c and low 14c. The company has 49.2 million shares on issue with a market cap of $11.5 million.
Last week the ASX queried the company after its shares shot up to 32c on October 10 from 21c the previous day.
In its reply, Lincoln said it was not aware of any information which had not been announced, but added that at the time of the annual report, no assay results had been received.
Similarly, drilling had been undertaken at the Cokabidnie region and none of those assay results were to hand when the report was written.
The company told the ASX that the assays were not complete to present a meaningful report to the market, but Monday's results may well have given the answer.
Shareholders should be cautioned about showing too much pessimism.
During the year the company issued a total of 71,672,211 fully paid ordinary shares raising a total of $7,844,000 in cash.
Out of those proceeds $678,102 was paid in share issue expenses.
At June 30 the company had cash on hand of $6,397,718 and subsequently issued 3,500,000 new fully paid ordinary shares at 30c each on August 16, raising $1,050,000 in cash pursuant to a joint venture agreement with Indian metals and iron-ore mining group Mineral Enterprises Ltd.
The company has adequate cash resources to continue its present activities over the next two years.
BACKGROUND
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Lincoln Minerals Ltd was listed on the ASX on March 9 after a successful IPO in which $7 million was raised through public subscription.
Funds raised are being used to explore its extensive tenement holdings within a world-class mineral province, the Gawler Craton, close to infrastructure at a time when there is unprecedented demand for iron ore, copper, zinc, lead, gold and uranium.
Exploration and evaluation of project areas began immediately after listing.
At the end of the reporting year, in little more than six months, the company had flown combined aeromagnetic and radiometric surveys over several areas, had undertaken a major calcrete and soil sampling program over priority targets and planning was well advanced for its inaugural drilling program.
During August the company commenced an aircore and reverse circulation (RC) drilling program on southern Eyre Peninsula.
The first drill holes were aimed at direct-shipping hematite and hematite banded iron formation (BIF) targets on the company's 100 per cent-owned Gum Flat tenement (EL3422).
The inaugural drilling program follows the announcement in August of Lincoln Minerals's exploration and investment agreement with Mineral Enterprises.
Under the Heads of Agreement, subject to certain conditions, Mineral Enterprises will contribute up to $2.5 million in exploration expenditure.
This will earn the JV company up to 40 per cent of the Gum Flat iron ore project.
Subject to the success of this drilling, the agreement with Mineral Enterprises will enable Lincoln Minerals to fast-track follow-up RC and diamond drilling over the next 12-18 months and hence maximise iron ore potential of the Gum Flat project for its investors.
In addition to the Gum Flat iron ore project, Lincoln Minerals will also drill uranium and base metal targets during September-October on its Mount Hill, Wilcherry and Cokabidnie projects on the central Eyre Peninsula where there are surface samples containing up to 1pc zinc, 0.075pc uranium and 272ppb gold not previously tested by drilling.
LML Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
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