Premium Resources (TSXV: PREM) has announced promising results from its exploration drilling program at the past-producing Selebi North underground mine in Botswana. Two new drill holes, strategically placed outside the existing resource estimate area, have intersected significant high-grade nickel and copper mineralization, raising hopes for expanding the mine’s resource base.
Drill hole SNUG-24-172, targeting the South Limb of the deposit, intersected 14.2 meters grading an impressive 1.73% copper, 1.66% nickel, and 0.08% cobalt, starting at a depth of 623.8 meters. The second hole, SNUG-24-144, drilled on the N2 Limb, returned 14.4 meters averaging 1.44% copper, 1.24% nickel, and 0.06% cobalt from 610.3 meters downhole.
“This exploration drilling program is designed to expand the mineral resource at Selebi North by testing large, highly conductive borehole electromagnetic (BHEM) plates located down plunge,” explained Sean Whiteford, President of Premium Resources. “These conductive plates are interpreted to represent zones of massive sulphide mineralization, which are known to host high-grade nickel-copper-cobalt deposits.”
The Selebi North mine, located 410 kilometers north of Botswana’s capital, Gaborone, has a rich history. Originally opened in 1990, the mine operated for 26 years, reaching a depth of 970 meters and producing 13.9 million tonnes of ore grading 0.74% nickel and 0.66% copper. Despite its productive past, the mine was placed on care and maintenance in 2016.
These new high-grade intercepts offer a compelling case for re-evaluating the potential of Selebi North. The company is optimistic that these discoveries could significantly add to the existing mineral resource.
Last August, Premium Resources announced an initial resource estimate for Selebi North, outlining 3 million tonnes in the indicated category, grading 0.9% copper and 0.98% nickel, containing 27,000 tonnes of copper and 29,000 tonnes of nickel. The inferred resource was estimated at 5.83 million tonnes grading 0.90% copper and 1.07% nickel, containing 52,000 tonnes of copper and 62,000 tonnes of nickel.
Selebi North is part of Premium Resources’ larger Selebi mines project, which also includes the Selebi Main deposit. Like Selebi North, the Selebi Main mine, which began production in 1980, was also suspended in 2016 due to processing facility issues. Selebi Main boasts a substantial inferred resource of 18.9 million tonnes grading 1.69% copper and 0.88% nickel, containing 319,000 tonnes of copper and 165,000 tonnes of nickel.
Premium Resources has ambitious plans for the Selebi project. According to a corporate presentation released last November, the company intends to update the resource estimate for both Selebi North and Selebi Main in the first half of this year. Furthermore, the company plans to complete upgrades to the mine shafts at both Selebi North and Main and begin construction of a new mill in the second half of next year. The goal is to commission the mill and restart production at the Selebi mines in 2027-2028.
The company’s recent drilling success and its aggressive development timeline underscore its commitment to bringing the Selebi mines back into production. The combination of historical production, a substantial existing resource, and these new high-grade discoveries positions Premium Resources well to capitalize on the growing global demand for nickel and copper, both critical metals for the green energy transition. The project’s location in Botswana, a stable and mining-friendly jurisdiction, further enhances its attractiveness.
While the project holds considerable promise, restarting a mine of this scale is a complex undertaking. Premium Resources will need to successfully navigate the challenges of updating the resource estimate, securing financing for the mill construction, and completing the necessary infrastructure upgrades. However, the potential rewards are significant, and the company’s recent progress suggests that it is well on its way to achieving its goals.
At midday, Premium’s Toronto-listed shares were trading down 2.5% at C$0.40, giving the company a market capitalization of approximately C$74 million ($51.5 million). The company’s stock has traded in a wide range over the past year, from a low of C$0.33 to a high of C$1.66, reflecting the market’s anticipation of the project’s potential. As Premium Resources continues to advance the Selebi project, it will undoubtedly remain a company to watch in the mining sector.