At the time of writing, shares of Alderan Resources Ltd [ASX:AL8] are up by 16.67%, to 35 cents per share.
Why did Alderan Resources Ltd shares do this?
Yesterday, the company announced drill hole FR18-004 hit about 100 metres of copper and zinc mineralisation:
‘Mineralisation was intersected from 196.6m to 296.45m which included a zone between 202.9m and 277.2m containing an estimated 1-3% chalcopyrite and 1-2% sphalerite. Cactus stock intrusive was intersected at 296.45m. The hole was terminated at 362.18m.’
100 metres of copper and nickel sounds good. But the market didn’t like it…
What now for Alderan Resources Ltd?
Here was the share price reaction:
Alderan’s share price fell from a high of 55 cents to 29 cents on the news. The market didn’t like that about 35% of the hole was copper and zinc sulphides. Yet, most porphyry systems tend to be wider and lower grade. So, without knowing the assay results, it’s too early to write off this result. That’s likely why the share price bounced today.
The company also plans to drill several holes over the coming months. Any one of these holes could tap the mother lode.
The bottom line: the next part of the story comes down to the assay grades for FR18-004, which are due within 3–4 weeks. If we see 0.5-1% copper over wide intersections, the share price could explode.
Resources Analyst, Markets & Money
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