Rockfire Resources (ROCK) , a gold and critical minerals explorer, said it has commenced drilling at its wholly-owned Molaoi zinc deposit in Greece.
The initial drilling programme, consisting of 5 holes, is designed to replicate several historical drill holes in order to establish a high confidence in the positioning of the latter. The increased confidence in the positioning of the historical holes is then expected to enable more Inferred resources to convert to Indicated resources, to be used in subsequent feasibility studies.
Rockfire noted that the current round of drilling is not meant to increase Molaoi's resource, but rather provide confidence in the conversion to Indicated resources. This is needed as Rockfire's current Inferred resource for Molaoi cannot be used in feasibility studies per JORC, as any such studies require Indicated resources.
Commencement of drilling at Molaoi paves the way for a feasibility study next year.
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More good news from Molaoi as Rockfire officially commences drilling at its polymetallic project in Greece. The drilling should effectively increase confidence in Molaoi's resource and convert its Inferred resource to Indicated, allowing for a feasibility study in 2024 and production not long thereafter.
While Rockfire was careful to note that the current round of drilling is not meant to increase the project's resource, we expect a resource upgrade to come in the near term nevertheless as the company continues to report more high-grade zinc, silver and lead at Molaoi. The project continues to see positive results that exceed expectations and demonstrate the high quality and grades of its polymetallic deposit, recently adding germanium and gallium to the mix.
In addition to the strong zinc continuity found and the confirmed presence of high-grade germanium and gallium, particularly encouraging is the positioning of the deposits, which tracks the findings of the Greek government from the 1980s. This matched positioning is what prompted today's announcement of drilling meant to replicate historical holes. Furthermore, the minimum width for mechanised mining of 2m is still being achieved or exceeded, which is a critical aspect of mine design and planning.
Investors have rewarded the good results from Greece, pushing ROCK shares 117% higher year-to-date. It should be noted that Rockfire is currently suspended on AIM as it is undergoing a major share purchase agreement constituting a reverse takeover with Paloma Precious for its 100% interest in Emirates Gold DMCC and 99% interest in Emperesse Bullion LLC. Paloma is the largest shareholder in Rockfire with an interest of 21.7%.
Per AIM rules, a reverse takeover requires a new application to be made for the enlarged share capital to be readmitted to AIM. As a result, Rockfire shares were suspended on September 15 until a new Admission Document is published. As the purchase constitutes a significant acquisition and expansion of Rockfire's footprint, accompanied by a £18.2m fundraise, we would expect a major price movement once shares are readmitted, further bolstered by today's news of commencement of drilling at Molaoi.
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