Canada Cobalt Works (CCW.V) released news midway through the trading session on October 24th. It wasn’t what many in the market were expecting.
The junior mining sector, predominately populated with shoot from the hip types – weak hands with impaired attention spans in need of immediate gratification – dumped their shares wholesale en masse.
This created an extraordinary buying opportunity for those with the stamina to read past the headline.
Equity Guru was on the battery metals story from the get. Our own Chris Parry began uncovering opportunity in the space before people even knew what cobalt was.
The following offerings will bring you up to speed on the company and recent developments…
The price of cobalt…
Like most metals across the battery and base metals arena, cobalt has experienced price weakness over the past few months.
After hitting $43.00 (per lb) back in late April, it retraced back to the $25.00 level and has been bouncing off it since.
$25.00 appears to be solid support. With the EV market moving into high gear, I’d expect this critical battery metal to begin reclaiming higher ground in the weeks and months to come.
Canada Cobalt Works News – October 24th…
As touched on above, the market was expecting drill hole results from the first level of the Castle Mine. To say that the market was eagerly anticipating these results would be a colossal understatement.
To appease those jonesing for assays, the company offered the following heads-up:
Underground Drilling Update
A total of 67 underground drill holes have now been completed on the first level of the Castle mine. Visual analysis of core supports the Company’s geological model that many well-mineralized cobalt vein structures were left behind by previous operators. The Company looks forward to providing initial assay results, and a steady stream thereafter, within the next seven to 10 days.
There are 67 holes to report, and judging by the tenor of the drill core descriptions highlighted in previous news releases, shareholders could be in for a treat. One such description stated the following…
“… ongoing underground drilling has intersected visual cobalt mineralization in most of the 40 drill holes completed to date, covering a distance of 200 meters…”
The focus of this October 24th news release was the discovery of a new mineralized zone. Earlier in the summer, the company reported that it had identified an area of interest 1.5 kilometers east of the Castle Mine – a large circular basin with multiple conductive anomalies spatially associated with multi-element MMI (mobile metal ion) soil anomalies.
The new discovery: 86 meters of “well-mineralized felsic Archean units at a downhole depth between 77 meters and 163 meters as well as mineralized mafic to ultramafic units above and below over significant widths starting from surface.”
This is an interesting development. CCW’s Castle project already holds the potential for significant cobalt, precious and base metal resources. This new discovery could add considerable scale.
The upper 77 meters of the hole is a coarse-grained, variable-textured and apparent cumulate gabbroic body (crystals up to 1 cm diameter) with disseminated pyrite throughout. From 77 m to 163 m is an intensely-altered, silicified and pyritized zone of felsic rocks unlike anything previously intersected at the Castle Property. Below the highly silicified unit are mineralized mafic to ultramafic units. Mineralization in these units consists of four distinct horizons featuring up to 1-cm diameter, coarse-grained blebby sulphides.
Core is being investigated and assayed for gold, platinum group elements, nickel and other potential metals.
The drilling of this hole, the 3rd of the program, is still in progress.
“At the completion of this hole, a follow-up hole will be collared to the north of the MMI anomaly and 50 meters to the west, drilled southward to give a second cut through these newly-discovered mineralized zones.”
Waste not want not…
At the bottom of this recent news release, the company reported the following development…
Pilot Plant Produces 8.25% Cobalt Concentrate From Waste Pile
Canada Cobalt’s on-site proprietary pilot plant recently produced a gravity concentrate from a 250-kilogram sample randomly selected from the Castle mine waste pile (material left behind outside the mine by previous operators). Subsequent assaying by Swastika Laboratories has returned a cobalt concentrate grading 8.25%, featuring head grades of 0.39% cobalt and 1,905 g/t silver.
Companies exploring for cobalt can only dream of encountering .39% cobalt and silver values measured by the kilogram. And here it is sitting as waste, tossed on the scrapheap by Agnico Eagle when it was mining the area back in the day.
Regarding the developments highlighted above, Frank Basa, Canada Cobalt President and CEO, commented,
Such head grades from the waste pile at Castle are extremely encouraging, not to mention our ability to produce such a high cobalt concentrate on site from material that was considered waste decades ago. Our proprietary Re-2OX process takes the concentrate from this stage, removes the arsenic and converts the concentrate into a client-specific technical grade cobalt sulphate.
There it is. We have our heads-up. The company says we’ll have assays within the next seven to ten days.
Expectations are high. Based on early reports of “visual cobalt mineralization” in the drill core, the next news drop could be a good one. It could be a really big shoe!
We stand to watch.
~ ~ Dirk Diggler
Full disclosure: CCW is an Equity Guru client. The author owns stock.Disclaimer: ALWAYS DO YOUR OWN RESEARCH and consult with a licensed investment professional before making an investment. This communication should not be used as a basis for making any investment.