REG - Sunrise Resources - Pioche Sepiolite Project – Positive Test Results

Sunrise ResourcesAnnouncement

15/04/2025 12:00

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RNS Number : 1206F  Sunrise Resources Plc  15 April 2025

15 April 2025

 

SUNRISE RESOURCES PLC

("Sunrise" or "the Company")

 

 

Pioche Sepiolite Project - Positive Test Results

 

Sunrise Resources plc (ticker symbol 'SRES') is pleased to announce positive
results from its first evaluation programme for samples from its Pioche
Sepiolite Project (the "Project") in Nevada, USA, since resuming management of
the Project.

 

Highlights

 

·    Sepiolite is a rare industrial clay found in only a few commercial
deposits around the world.

 

·    Evaluation tests carried out to simulate processing methods employed
for commercial sepiolite production in the United States.

 

·    Results:

 

Ø compare very favourably with commercially available sepiolite in the US;

 

Ø confirm the commercial potential of the large sepiolite clay deposits at
Pioche across a range of applications including critical saltwater
applications in the valuable oil and gas drilling market; and

 

Ø allow the Company to identify higher grade areas within the several square
kilometre area in which sepiolite has been drilled to date.

 

 

Commenting today, Executive Chairman Patrick Cheetham said:

 

"We are delighted to release these results. They allow us to demonstrate - for
the first time - the suitability of Pioche sepiolite for the US market when
suitably processed. The results should help dispel any uncertainties that
surrounded the Project following Tolsa's decision not to exercise its option
to purchase the Project at the end of last year, a decision that may

ultimately work in the Company's favour.

 

"Sepiolite is very rare in commercial quantities but has now been found at
Pioche in surface sampling and drilling over several square kilometres. With
the only other US sepiolite producer facing severe environmental restrictions,
Pioche now presents an opportunity to develop a new replacement source of
sepiolite in the US.

 

"The largest single market for sepiolite is in oil and gas well drilling, a
market not served by Tolsa. We believe the Project could be a beneficiary
of planned US policies to increase domestic oil and gas drilling as a way to
reduce reliance on foreign energy sources and therefore, the Project is
now generating interest from a range of consumers and other clay producers.

 

"We expect to receive all of the remaining drill samples from Tolsa over the
next several weeks and to continue engagement with the industry to the find
the best development option for the Company."

 

 

 

 

 

Further information:

 

 Sunrise Resources plc                  Tel: +44 (0)1625 838 884

 Patrick Cheetham, Executive Chairman
                                        Tel: +44 (0)207 628 3396

 Beaumont Cornish Limited

 Nominated Adviser

 James Biddle/Roland Cornish
                                        Tel: +44 (0)207 469 0930

 Peterhouse Capital Limited

 Broker

 Lucy Williams/Duncan Vasey

 

Market Abuse Regulation (MAR) Disclosure

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 which  forms part of UK domestic law by virtue of the
European Union (Withdrawal) Act 2018 ('MAR'). Upon the publication of this
announcement via a Regulatory Information Service ('RIS'), this inside
information is now considered to be in the public domain.

 

Nominated Adviser

 

Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Nominated
Adviser and is authorised and regulated by the FCA. Beaumont Cornish's
responsibilities as the Company's Nominated Adviser, including a
responsibility to advise and guide the Company on its responsibilities under
the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed
solely to the London Stock Exchange. Beaumont Cornish is not acting for and
will not be responsible to any other persons for providing protections
afforded to customers of Beaumont Cornish nor for advising them in relation to
the proposed arrangements described in this announcement or any matter
referred to in it.

 

Shares in the Company trade on AIM. EPIC: "SRES". Website:
www.sunriseresourcesplc.com

 

 

Detailed Information

 

The Pioche Sepiolite Project is located near the historic mining town of
Pioche in southeastern Nevada, USA. The Project was held under option by
Spanish sepiolite producer, Tolsa, from June 2022 to the end of December 2024.
Tolsa carried out mapping, trenching and two phases of drilling prior to
withdrawing from the Project at the end of 2024.

 

In the United States, sepiolite is primarily used for its viscosity
modification (gelling) properties in freshwater and saltwater applications
(see "About Sepiolite" below). Viscosity testing is therefore critical to
assessing the commercial potential of the Pioche sepiolite. The testwork
programme now being reported was designed and executed by Mr Tom Powell. Mr
Powell is a chemical engineer and was formerly the General Manager of the IMV
sepiolite mine in the Amargosa Valley, Nevada, the only producing sepiolite
mine in the US. Mr Powell is an acknowledged expert on clays and sepiolite in
particular, and holds a number of patents on clay products. Mr Powell holds a
20% economic interest in the Pioche Sepiolite Project.

 

Three Pioche sepiolite samples were provided by Tolsa in advance of the return
to the Company of all remaining samples from Tolsa's exploration programmes at
Pioche. The samples were selected based upon freshwater viscosities and
available sample size reported by Tolsa. Sunrise received one kilogram of each
sample of which 200g of each has been provided to an interested third party.

 

The three Pioche samples were tested for both freshwater and saltwater
viscosities. As a control/comparison, various samples of commercially
available sepiolite produced in the US were tested at the same time.

 

The three Pioche samples were processed to simulate commercial sepiolite
processing methods used in Nevada. Samples were dried to 8-12% free moisture
at 215 degrees Fahrenheit, then ground and screened through a 60-mesh screen.
A subset of screened Pioche and control samples were then "extruded" through a
kitchen-top meat grinder to simulate commercial extrusion.

 

When viscosities were tested in freshwater, the Pioche samples showed
relatively low viscosities, but when extruded the viscosities increased
several-fold to levels similar or higher than the commercially available
control samples.

 

These results confirm that sepiolite processing has a major impact upon
viscosity, particularly the shearing, drying, grinding and extrusion
methodologies employed. The shearing effect of extrusion helps delaminate
bundled fibres of sepiolite which are typically found in the Nevada sepiolite
deposits, thereby substantially improving the gelling properties.

 

Tolsa has reported lower freshwater viscosity results for these three samples
but their sample preparation and testing methods are not comparable. Spanish
sepiolite fibres are not typically bundled and so Tolsa's standard sample
preparation methods may not have achieved the delamination of the sepiolite
fibres required for the Nevada sepiolite deposits.

 

The three Pioche sepiolite samples and the control samples were also tested
for their gelling effect in saltwater. Saltwater viscosities were measured in
accordance with American Petroleum Institute (API) Specification 13A Section
8, using a Fann Viscometer. In these tests, extruded Pioche sepiolite
out-performed the commercially available extruded US control samples.

 

Tolsa did not report any saltwater viscosity results. This is not a
significant market for their Spanish sepiolite but saltwater uses are
particularly important for the US oil well market which accounts for
approximately 50% of the US market for sepiolite.

 

Tolsa's reported freshwater results, whilst not directly comparable, do
provide a basis to assess the relative performance of different sepiolite
samples at Pioche and has allowed the Company to define higher grade areas
within the large Pioche sepiolite deposit where commercial production could be
started.

 

 

About Sepiolite

 

Sepiolite is a non-swelling, lightweight, porous hydrous magnesium silicate
clay. It has unique characteristics, is scarce, and there are very few
commercial deposits in the world.

 

In the US, a major use is in oil well drilling fluids primarily as a
viscosifier and suspending agent, especially in saltwater or brine-based
systems where other clays like bentonite are less effective. It has a high
salt tolerance and maintains viscosity in saline or seawater environments
where bentonite tends to flocculate and lose effectiveness. It also exhibits
thixotropic behaviour forming gels when static, suspending drill cuttings and
weighting materials such as barite, but thins out under shear, aiding in
pumpability. It provides good rheological properties without adding a large
amount of solid material, reducing the risk of formation damage. Sepiolite has
high thermal stability and so is the only clay used in high temperature and
high pressure wells.

 

Sepiolite is used in liquid animal feed supplements as a binder and carrier
for nutrients and growth promoter. It is also used in building products such
as drywall tape joint compounds, putty, caulk, texture coatings and asphalt
emulsion coatings where freshwater viscosity is important.

 

Sepiolite possesses a high surface area due to channels in the crystal lattice
that gives it a structural nano-porosity. Its unusual crystal shape also adds
to the internal porosity and gives it a light weight. Sepiolite's high surface
area and porosity account for sepiolite's outstanding sorption capacity. Just
20g of sepiolite can have an internal surface area equivalent to that of a
football field and sepiolite can absorb more than its weight in water. The
largest market globally for sepiolite is for use in light-weight non-clumping
pet litters where it has superior properties compared to other clays used in
this application.

 

 

Glossary:

 

Flocculate: means to form or cause to form to clumps
(https://www.google.com/search?sa=X&sca_esv=926e7e4e58f3fc80&rlz=1C1GCEU_en-GBGB1050GB1050&biw=1920&bih=953&q=clumps&si=APYL9btfm7lNLuo1yW1KZRdWc6yL4b3syV-grWzat6tl7zZwE2hQG4XqL4oCqOfb3S_I6oWN2GyfxTciyLHpo7ARmNUAtAT-GQ%3D%3D&expnd=1&ved=2ahUKEwjq-IbczdmMAxW4X0EAHSTIDrcQyecJegQIPBAO)
 or masses
(https://www.google.com/search?sa=X&sca_esv=926e7e4e58f3fc80&rlz=1C1GCEU_en-GBGB1050GB1050&biw=1920&bih=953&q=masses&si=APYL9btfm7lNLuo1yW1KZRdWc6yLG06MoMNuJPuwg7gNOs9uium6i5wawNUReljl1vprjT0LsysGUd81gvt8pByheOpiV7wS-w%3D%3D&expnd=1&ved=2ahUKEwjq-IbczdmMAxW4X0EAHSTIDrcQyecJegQIPBAP)
of particles otherwise dispersed in a fluid.

 

Rheological Properties: means the properties of a material such as a fluid,
particularly viscosity, which change in response to physical stress such as
shearing.

 

Thixotropic: refers to a material (typically a fluid or gel) that becomes less
viscous (thinner) when subjected to a constant shear stress, like stirring or
shaking, and then recovers its original viscosity over time when the stress is
removed.

 

 

 

A Pioche Project specific presentation can be found at:

 

https://www.sunriseresourcesplc.com/presentations
(https://www.sunriseresourcesplc.com/presentations)

 

An interview with the Executive Chairman, Patrick Cheetham, featuring the
Pioche Sepiolite Project can be found at:

 

https://www.sunriseresourcesplc.com/interviews
(https://www.sunriseresourcesplc.com/interviews)

 

 

Qualified Person Information:

 

The information in this release has been compiled and reviewed by Mr. Patrick
Cheetham (MIMMM, MAusIMM) who is a qualified person for the purposes of the
AIM Note for Mining and Oil & Gas Companies. Mr. Cheetham is a Member of
the Institute of Materials, Minerals & Mining and also a member of the
Australasian Institute of Mining & Metallurgy.

 

 

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