This is an interesting story...
The Sullivan mine was a large underground mine in Kimberly British Colombia discovered sometime in the 1890s. Over the mines lifetime (ending in 2001 iirc) it produced over 150 millions tonnes of ore, containing three billion ounces of silver, eight million tonnes of zinc, and eight million tonnes of lead.
Anyways, since that time, many companies have been working in the area trying to find, what has been dubbed as, Sullivan 2.
In 2010 and 2011 a company called Omineca mining completed a surface geophysical survey where they detected a large gravity anomaly, sharing many geological features with the SEDEX (sedimenary exhaultive deposits, http://en.wikipedia.org/wiki/Sedimentary_exhalative_deposits ) formation found at the original Sullivan mine.
From the press release...
In 2010 and 2011, Gravitas completed an extensive surface geophysical program, outlining a prominent gravity anomaly with dimensions of approximately three kilometres by one kilometre, at an interpreted depth of up to approximately 1,000 metres.This geophysical feature is located seven kilometres south of the Kootenay King deposit, a past producer that contained mineralization of similar tenor and mode of occurrence as Sullivan
In early April of 2012, word got out that drill results would be released. As expected, the share price of OMM shot up to .45 as highly speculative investors hoped for results that may indicate the discovery of a Sullivan 2.
The anomaly was determined to be at a depth of 600m - 1000m and they began drilling to reach such depths. Unfortunately, as a April 19th press release informed investors, the drill hole deviated from its' intended target. From the press release...
As described in previous news, the drill hole has experienced deviation in its planned dip and direction such that the bottom of the hole is not located where it was originally intended. The drill hole's trajectory appears to be following in steeply-dipping Fort Steele rocks, interpreted to be in the immediate footwall of the gravity target. Downhole survey readings also indicate the possibility that both the temperature gradient and magnetic field are decreasing with depth, suggesting that the deviated hole has been moving away from the target over the last 150 metres to 200 metres of drilling.
This saw investors hitting a continually dropping bid and the stock price saw a drop of over %50 in one day of trading. Unfortunately for me, I wasn't at my computer when the news release came out. The following day I got to see my position worth a little less than half of what it was worth the day before. I had purchased 3000 shares at .37. Had I'd been around at the time I certainly would have sold, but once it dropped so much I figured I would just be patient and wait for the next drill campaign. The company has a little less than 3 million in cash in the treasury, so further funding is likely unnecessary for further drilling.
With a current share price of .09 it may be worth looking into at some point in the near future. I'm not sure what the drill season is in Kimberly B.C, but one can expect any announcement of further drilling to shoot the stock price up. They may actually have to find something for me to make money off of this, but I believe that if I'm patient I'll loose less money on it.
No comments:
Post a Comment