REG - Kendrick Resources - Operational Update

Kendrick ResourcesAnnouncement

21/08/2023 07:00

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RNS Number : 8454J  Kendrick Resources PLC  21 August 2023

 

21 August 2023

Kendrick Resources Plc

("Kendrick" or the "Company")

 

 Operational Update

 

Kendrick Resources Plc (LSE: KEN), a mineral exploration and development
company with vanadium, nickel and copper projects in Scandinavia is pleased to
provide an operational update for its Airijoki Project in Vittangi and initial
work undertaken on the recently acquired Mjövattnet nickel - copper - PGM
licence in Sweden.

 

Highlights

 

·    Commencement of 1,500m exploration diamond drill programme over
Airijoki 200 licence with the objective of significantly increasing the
existing vanadium mineral resource

 

·    Completion of ionic leach soil sampling programme over recently
awarded prospective Airijoki licences where extensions to known vanadium and
copper mineralisation may occur.

 

·    Completion of ionic leach soil sampling programme over the recently
acquired Mjövattnet Nickel-Copper-PGM licences in Sweden.

 

Colin Bird, Executive Chairman of Kendrick Resources Plc commented:

 

"The drilling programme is a result of our ongoing fieldwork, and we are
particularly excited about the strong geophysics and geo-chemical results that
have targeted the drilling positions.

 

We eagerly await the results of the Mjövattnet nickel, copper and PGM soil
sampling programme.  We are confident for the potential of strike extension
as well as well as generating future targets within the licence.  The current
soil programme will greatly assist us in this direction.

 

We will report the results for both the drilling and soil sampling programme
as they are completed and interpreted by the company's geologist and
third-party consultants were appropriate."

 

Airijoki Exploration strategy: Earlier in the year the Company set out its
intention to increase the mineral Resource at Airijoki which currently stands
at 44.3Mt @ 0.4% V(2)O(5) for 100,800 tonnes of contained V(2)O(5) and this
programme is progressing on two fronts;

 

·    Firstly, with additional geochemical surveys over our most recent
licence acquisitions where coincident prospective vanadium and copper in soil
and rock values and geophysical anomalies are suggestive of a continuation of
the geology that has generated the maiden resource.

 

·    Secondly, the drill programme has commenced and feedback from site
indicates promising intercepts of magnetite-bearing rock are clearly present
which is expected to host vanadium.

 

The current focus is on the known geophysical extension of the current Mineral
Resource within Licence Nr 200 where the geophysical signature clearly shows a
continuous anomalous extension where earlier drilling on the adjacent Kendrick
licence intersected vanadium-bearing lithologies.

 

There is a noticeable groundswell of interest and commitment to Vanadium Redox
Battery technology. It is all very well generating renewable energy but the
ability to store excess energy has to some extent been overlooked. The
benefits of the Vanadium Redox system make it an ideal static battery storage
option and the intention is to ensure that Kendrick is well-placed to be a
provider of vanadium in the future".

 

Airijoki Drilling Programme

The Airijoki 200 licence is located immediately to the northeast of the
Airijoki 100 licence in which the 44.3Mt JORC Inferred Vanadium resource is
estimated. Following the completion of a Magnetic Ground Survey in March 2021
over the Airijoki 200 licence, it can be deduced with a reasonable amount of
confidence that the Vanadium mineralisation extends and continues to the
northeast into this licence area.

 

A public meeting was held at the Vittangi community hall at the end of July
where representatives of the Company presented the proposed drill programme to
the attendees and answered all queries related to the programme.

 

The initial diamond drill exploration programme is based on a line spacing of
400m along strike, with a total of 10 holes and approximately ~1,500m being
drilled.

 

The programme is expected to take around 8 weeks to complete and should this
programme be successful, it is anticipated that it has the potential to
significantly expand the current Vanadium resource at Airijoki.

 

Figure 1. is a map showing magnetic survey, JORC Inferred Resource outline and
proposed location of drillholes.

 

Figure 2. is a cross-section showing proposed drill hole locations and traces
along with interpreted magnetic anomalies being targeted.

 

Figure 1. Map showing magnetic survey, JORC Inferred Resource outline and
proposed location of drillholes.

 

Figure 2. Cross-section showing proposed drill hole locations and traces along
with interpreted magnetic anomalies being targeted.

 

Ionic Leach Soil Sampling Programme - Airijoki Vanadium

The Company has recently completed a soil geochemical sampling programme for
ionic leach testing, primarily on the recently awarded (October 2022) Airijoki
104 and Airijoki 105 licences. The purpose of this programme is to investigate
the mineral potential of these licences and assist with future targeting in
these licences.

 

In general, the soil samples were collected every 100m along profiles spaced
400m apart that are to be followed up with infill soil sampling in the areas
of interest. The sampling covers an area of approximately 39km(2) at Airijoki
104 and 22km(2) at Airijoki 105 licences respectively, excluding areas covered
by lakes, bogs, or mires.

 

In total, 907 soil samples were collected and submitted to the ALS laboratory
in Malå, Sweden for processing and further analysis at the ALS laboratory in
Loughrea, Ireland. Once the results are made available, the data will be
processed with ioGAS software and interpreted with the aim of evaluating the
multi-commodity potential of the area.

 

Figure 3. Is a map showing Kendrick's areas under licence at Airijoki and the
location of geochemical samples.

 

 

Figure 3. Map showing Kendrick's areas under licence at Airijoki and location
of geochemical samples. previous results were released in March 2023.

 

 

Ionic Leach Soil Sampling Programme -Mjövattnet Ni, Cu & PGM Exploration
Licence

The Company has also completed a soil geochemical sampling programme for ionic
leach testing, on the recently acquired (August 2023) Mjövattnet 103 licence.
The purpose of this programme is to investigate the mineral potential of this
licence in the vicinity to the known Lappvattnet deposit(1) and assist with
future targeting.

 

In general, the soil samples were collected every 50m along profiles spaced
200m apart. The sampling covers an area of approximately 5km(2), excluding
areas covered by lakes, bogs or mires.

 

In total, 423 soil samples were collected and will be submitted to the ALS lab
in Malå, Sweden for processing and further analysis at the ALS lab in
Loughrea, Ireland.

 

Figure 4.is a map showing the planned location of geochemical samples at
licence Mjövattnet 103.

 

 

Figure 4. Map showing the planned location of geochemical samples at licence
Mjövattnet 103.

 

This announcement contains information which, prior to its disclosure, was
inside information as stipulated under Regulation 11 of the Market Abuse
(Amendment) (EU Exit) Regulations 2019/310 (as amended).

 

For additional information please contact:

 

 Kendrick Resources Plc:     Tel: +44 2039 616 086

 Chairman                    Colin Bird

 Novum Securities            Tel: +44 7399 9400

 Financial Adviser           David Coffman / George Duxberry

 Joint Broker                Jon Bellis

 Shard Capital Partners LLP  Tel: +44 207 186 9952

 Joint Broker                Damon Heath / Isabella Pierre

 

 

Qualified Person

 

The technical information contained in this announcement has been reviewed,
verified, and approved by Colin Bird, CC.ENG, FIMMM, South African and UK
Certified Mine Manager and Director of Kendrick Resources plc, with more than
40 years' experience mainly in hard rock mining.

 

About Kendrick Resources Plc

 

Kendrick Resources Plc is a mineral exploration and development company with
projects primarily based across Scandinavia. The principal of its business is
to explore the opportunities within the natural resources sector with a focus
on battery, base, and precious metals including but not limited to vanadium
and nickel. In doing so, the Company is looking to build a long-term energy
metals business in Scandinavia which delivers energy metals to Europe to help
enable its renewable energy transformation by building a top tier energy
metals production business.

 

The Airijoki Project

 

The Airijoki Project lies within the Vittangi Greenstone Group (VGG) of
northern Sweden, in relative proximity to established infrastructure as well
as several significant mines (i.e. Kiruna, Svapparvaara, Leveäniemi and
Mertainen) and other new energy mineral projects (i.e. Talga Group's Vittangi
graphite project).  Geologically the Project is centred on a laterally
continuous, northeast trending gabbroic (locally termed diabase) intrusion
which hosts vanadium-magnetite mineralisation along with lesser base metal
(predominantly copper mineralisation).

 

Airijoki is currently supported by an Inferred Mineral Resource comprising
44.3 Mt at an in-situ grade of 0.4% V(2)O(5), containing 5.9 Mt of magnetite
averaging 1.7% V(2)O(5) (in magnetite concentrate) for 100,800 t of contained
V(2)O(5) based on a 13.3% mass recovery of magnetite concentrate and a 0.7%
V(2)O(5) cut-off grade, on a 100% equity basis (and net attributable basis).

 

Subsequent Davis Tube Recovery (DTR) and low-intensity magnetic separation
(LIMS) test work indicated that vanadium magnetite concentrates grading over
2% V(2)O(5) and more than 65% Fe are possible at mass recoveries over 20% from
the vanadium mineralisation at Airijoki.  Overall, vanadium recoveries in
excess of 70% can be achieved using a relatively coarse grind size of 355 µm
and using LIMS without the need for further treatment.

 

Conceptual studies completed in 2019 envisage that Airijoki will be developed
by bulk open pit mining techniques from four open pits using standard drill
and blast, load/haul and crusher feed/magnetic separation to produce a
vanadium magnetite concentrate. The conceptual techno-economic studies
demonstrated the Project has the potential to be financially robust.  Further
metallurgical test work, extensional and infill drilling and optimisation
studies are warranted at Airijoki prior to more advanced techno-economic
analysis.

 

Vanadium

Technological advances are expected to positively influence the demand for
vanadium. Principally used as an alloy in steel and aluminium production, its'
ability to make materials stronger and lighter offers important benefits
particularly for weight-to-strength ratio, an important consideration
particularly for EVs'. Vanadium pentoxide is also an important component in
REDOX flow batteries used for energy storage associated with solar and wind
farms. With the projected increased use of vanadium in EV batteries, demand
for the metal is expected to grow.

 

Mjövattnet and Njuggträskliden Licences

The Swedish Nickel Projects are located in east-central Sweden near
Skelleftea, the two licences result from regional nickel exploration
undertaken by the Swedish Geological survey and other state-run enterprises.
Mjövattnet and Njuggträskliden became known as the "Nickel Line" and the
deposits occur just outside the Skelleftea Mining District, home to Boliden
AB's headquarters and smelting facility.

 

Regional nickel exploration became a focus of the Swedish Geological Survey
("SGU") and other state-run mining concerns in the 1970's and early 1980's,
leading to the discoveries of EMX's Mjövattnet and Njuggträskliden
nickel-copper-cobalt-PGE deposits along what became known as the "Nickel Line"
in north central Sweden. These deposits and occurrences are located just
outside of the Skellefteå Mining District, where Boliden AB has its regional
headquarters and operates a smelting facility.

In the past few years, the recent emphasis on conversion to electric vehicles
within the European Union and construction of a vehicle battery factory near
Skellefteå has resulted in renewed interest in the Nickel Line and its
nickel-copper sulfide deposits.

Notes from the Swedish Geological Company ("NSG") in 1987 state that
Mjövattnet has only been partly explored and its depth potential remains
unknown. Likewise, several clusters of nickel sulfide bearing boulders lie to
the northeast and southeast (the Frangsmyran, Holmsvattnet, Långbacken and
Vallen occurrences), the bedrock sources of which have yet to be identified.

The Njuggträskliden deposit was discovered in the early 1970's via boulder
tracing, which led to the identification of several mineralised outcrops.
Multiple drill defined zones of nickel sulfide mineralisation were delineated
in the early 1980's, many of which were recognised as being enriched in PGE's
, but only some of the collected drill core samples were analysed for PGE's.

Since being drilled by the NSG, a few smaller companies have conducted limited
exploration in the area, including twinning of some of the historic drill
holes and re-analysing some of the historic drill core for PGE's. However,
little or no systematic exploration has taken place.

 

 

The Mjövattnet Licence hosts Syn-deformation or Feeder-style-type nickel
copper mineralisation. Graphite inclusions within ultramafic cumulates, low
Se/S ratios in sulphides and trace element composition indicate composition of
parental magma strongly modified during ascent. Country rock comprises
migmatised paragneiss with interbedded graphitic schist. Intrusive breccia,
lack of compositional layering, brecciated sulphides as offset orebodies
result in a complicated intrusive complex morphology.

 

Mjövattnet Historic drilling was completed by NSG, Outokumpu, SGU, and
Blackstone Resources. Results were reported to the SGU and distributed as a
part of their national drill database and is shown in Figure One shows the
drill defined mineralisation on the Mjövattnet licence.

The translation of Mjövattnet is "mead water" in English, which was one of
the first nickel sulfide discoveries made along the Nickel Line. Discovered in
1971, the Mjövattnet nickel sulfide deposit occurs along a structural
corridor of similar mineralised bodies, including the Lappvattnet, Brannorna,
and Lappbacken zones to the southwest, each of which have drill defined zones
of mineralization, with the latter two also lying within the Mjövattnet
Licence (Lappvattnet is currently held by a third party).

 

Two targets identified at Mjövattnet, at Brannorna and Mjövattnet both
drill-defined along with boulder occurrences where the source of the
mineralised boulders is yet to be discovered. The combination of drill
defined nickel sulphide mineralisation, which remains open in multiple
directions, and the upside potential near the clusters of mineralised boulders
makes the Mjövattnet project particularly attractive for further exploration.

 

The Njuggträskliden Licence is described as an open dynamic magmatic
wedge-shaped conduit featuring intrusive breccias, multiple magmatic pulses of
mafic and ultramafic composition in a gabbro, pyroxenite, peridotite host
lithology. Mineralisation is made up of massive and disseminated sulphide
mineralisation, veinlets and breccias. As with Mjövattnet, the country rock
is composed of migmatised paragneiss.

 

The drill defined zones of mineralisation at Njuggträskliden remain open at
depth, and the NSG noted in their summary report that a 10-kilometre corridor
of similar boulder clusters with nickel sulphide mineralisation remains to be
explored at Njuggträskliden. These occurrences all lie within the
Njuggträskliden Licence and represent considerable upside exploration
potential.

 

  Appendix A - Glossary of Technical Terms

 

 "anomaly or anomalous"    something in mineral exploration that geologists interpret as deviating from
                           what is standard, normal, or expected.

 "assay"                   The laboratory test conducted to determine the proportion of a mineral within
                           a rock or other material. For base metals, usually reported as percentage
                           which is equivalent to percentage of the mineral (i.e. copper) per tonne of
                           rock.

 "azimuth"                 the "compass direction" refers to a geographic bearing or azimuth as measured
                           by a magnetic compass, in true or magnetic north.

 "diamond drilling"        A drilling method in which penetration is achieved through abrasive cutting by
                           rotation of a diamond encrusted drill bit. This drilling method enables
                           collection of tubes of intact rock (core) and when successful gives the best
                           possible quality samples for description, sampling and analysis of an ore body
                           or mineralised structure.

 "dip"                     A line directed down the steepest axis of a planar structure including a
                           planar ore body or zone of mineralisation. The dip has a measurable direction
                           and inclination from horizontal.

 "geochemical"             Refers to geological information using measurements derived from chemical
                           analysis.

 "geophysical"             Refers to geological information using unit measurements derived from the use
                           of magnetic and electrical readings.

 "geophysical techniques"  include the exploration of an area by exploiting differences in physical
                           properties of different rock types. Geophysical methods include seismic,
                           magnetic, gravity, induced polarisation and other techniques; geophysical
                           surveys can be undertaken from the ground or from the air.

 "grade"                   The proportion of a mineral within a rock or other material. For copper
                           mineralisation this is usually reported as % of copper per tonne of rock.

 "g/t"                     grams per tonne; equivalent to parts per million ('ppm')

 "Indicated Resource"      An "Indicated Mineral Resource" is that part of a Mineral Resource for which
                           quantity, grade or quality, densities, shape and physical characteristics, can
                           be estimated with a level of confidence sufficient to allow the appropriate
                           application of technical and economic parameters, to support mine planning and
                           evaluation of the economic viability of the deposit. The estimate is based on
                           detailed and reliable exploration and testing information gathered through
                           appropriate techniques from locations such as outcrops, trenches, pits,
                           workings and drill holes that are spaced closely enough for geological and
                           grade continuity to be reasonably assumed.

 "Inferred Resource"       An "Inferred Mineral Resource" is that part of a Mineral Resource for which
                           quantity and grade or quality can be estimated on the basis of geological
                           evidence and limited sampling and reasonably assumed, but not verified,
                           geological and grade continuity. The estimate is based on limited information
                           and sampling gathered through appropriate techniques from locations such as
                           outcrops, trenches, pits, workings and drill holes.

 "intercept"               Refers to a sample or sequence of samples taken across the entire width or an
                           ore body or mineralised zone. The intercept is described by the entire
                           thickness and the average grade of mineralisation.

 "massive"                 In a geological sense, refers to a zone of mineralisation that is dominated by
                           sulphide minerals.  The sulphide-mineral-rich material can occur in
                           centimetre-scale, metre-scale or in tens of metres wide veins, lenses or
                           sheet-like bodies containing sphalerite, galena, and / or chalcopyrite etc.

 "Measured Resource"       A "Measured Mineral Resource" is that part of a Mineral Resource for which
                           quantity, grade or quality, densities, shape, and physical characteristics are
                           so well established that they can be estimated with confidence sufficient to
                           allow the appropriate application of technical and economic parameters, to
                           support production planning and evaluation of the economic viability of the
                           deposit. The estimate is based on detailed and reliable exploration, sampling
                           and testing information gathered through appropriate techniques from locations
                           such as outcrops, trenches, pits, workings and drill holes that are spaced
                           closely enough to confirm both geological and grade continuity.
 "Mineral Resource"        A "Mineral Resource" is a concentration or occurrence of diamonds, natural
                           solid inorganic material, or natural solid fossilised organic material
                           including base and precious metals, coal, and industrial minerals in or on the
                           Earth's crust in such form and quantity and of such a grade or quality that it
                           has reasonable prospects for economic extraction. The location, quantity,
                           grade, geological characteristics and continuity of a Mineral Resource are
                           known, estimated or interpreted from specific geological evidence and
                           knowledge.

 "mineralisation"          In geology, mineralisation is the deposition of economically important metals
                           (copper, gold, lead, zin etc) that in some cases can be in sufficient quantity
                           to form mineral ore bodies.

 "outcrop"                 A section of a rock formation or mineral vein that appears at the surface of
                           the earth.  Geologists take direct observations and samples from outcrops,
                           used in geologic analysis and creating geologic maps. In situ (in place)
                           measurements are critical for proper analysis of the geology and
                           mineralisation of the area under investigation.

 "veins"                   A vein is a sheet-like or anastomosing fracture that has been infilled with
                           mineral ore (chalcopyrite, covellite etc) or mineral gangue (quartz, calcite
                           etc) material, within a rock. Veins form when minerals carried by an aqueous
                           solution within the rock mass are deposited through precipitation and infill
                           or coat the fracture faces.

 

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