Drilling at Suva Ruda is set to get underway, according to Peter Mullens, chief executive of Tethyan Resources PLC.
The news comes as Tethyan initiates an £890,000 fundraising to help it accelerate the pace of work on its portfolio of Serbian copper-gold projects.
The idea is to place around 30 mln new Tethyan shares with Canadian investors and a further 10 mln shares with UK investors and to use the money to make further progress at Suva Ruda, and at Gokcanica, Tethyan’s second, less advanced project.
The first bit of work is already in the bag, following the signing of the option over Suva Ruda back in September. Tethyan has completed a programme of geological mapping and soil sampling that was designed to zero in on potential drill targets.
That’s now been done, and the news that a new zone of mineralisation has been identified as part of this process was seen as a real boon by investors, who boosted the company’s share price by 5% to 2.5p on 18 October.
A second zone targeted an area about which significant data is already known, but this too delivered positive results, and now sets the company up well for the rigs to begin turning within the next couple of days.
And it could be a real game-changer for Tethyan if it lives up to expectations. Both First Quantum and Euromax Resources have been active in this area, but Mullens points out that previous exploration work was done only to relatively shallow depths.
And if, as Tethyan is now hypothesising, Suva Ruda is in fact a copper porphyry of some size and scale, then it’s likely that mineralisation will run much deeper.
“We’re optimistic the grades will improve at depth,” he says. And he cites recent success from other copper companies as one reason why the market may well support that view.
Solgold’s mineralisation runs down deeper than 1,000 metres at Cascabel, and that company is now worth several hundred million dollars, after two majors bid up the price of the latest funding.
And Reservoir Minerals, now part of Nevsun, has also had a major success in Serbia itself, with the discovery of Timok project.
So with £500,000 already in the bank, new money coming in, and a growing appetite in the market Tethyan looks likely to gain some real traction as the exploration cranks up.
Approximately 2,500 metres of drilling is planned before Christmas. But that’ll be just the start.
“Depending on what we get we’ll then do a bigger programme,” says Mullens.
By the spring of next year it’s likely that Tethyan will also be ready to drill Gokcanica, following an ongoing programme of stream sediment sampling.
All told, it should be a very busy period for Tethyan, but it may not end there.
For one thing, the question of how to fund Suva Ruda and Gokcanica into and beyond next year is likely to recur.
“We have two choices,” says Mullens. “One would be looking for a mid-tier partner. But for preference we’d like to drive our own bus. Let’s see what the results bring first.”
So there’s that. And there’s also the possibility of other projects emerging in what, all told, is a country that remains relatively under-explored.
Gokcanica and Suva Ruda both occur on highly prospective ground that forms part of a total Tethyan land package of 197 square kilometres.
This ground, says the Tethyan literature, is highly prospective for the discovery of epithermal and porphyry copper, gold and polymetallic mineralisation. It will be interesting to see how it all plays out.