At the time of writing, shares of Jervois Mining Ltd [ASX:JRV] are up by 17.86%, now trading for 33 cents per share.
Why did Jervois Mining Ltd shares do this?
In response to weekend media speculation, the company confirmed it submitted an application for a prospecting license over the Kabanga nickel-cobalt deposit in Tanzania. Kabanga’s resource (mostly in the indicated and measured categories) stands at 57 million tonnes of sulphide ore, grading 2.62% nickel, 0.20% cobalt and 0.35% copper.
What now for Jervois Mining Ltd?
The company elaborated on the project today:
‘The quality of the mineralization is exceptional, with low-risk sulphide metallurgy expected to produce a high-grade low impurity nickel-cobalt product. Prior owners invested significantly in drilling and studies that culminated in a [definitive feasibility study] DFS envisaging annual production in excess of 50ktpa nickel with significant cobalt and copper co-products.’
Kabanga’s geology is similar to other world-class nickel-cobalt basins, such as Thompson, Manitoba, Jinchuan and Voisey’s Bay. That’s why, despite not actually owning the project yet, the company’s market capitalisation stands at roughly $60 million.
That’s a pretty decent price tag!
But it could go a lot higher…
The story comes down to whether Tanzania grants the company the project. If it happens, the share price could skyrocket. Jervois believes it can significantly improve the DFS numbers. That could generate a lot of shareholder value in the short, medium and long term.
Resources Analyst, Markets & Money
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