Kavango Resources plc (LSE:KAV), the exploration company targeting the discovery of world-class mineral deposits in Botswana, is pleased to announce an expansion to the Company’s current drill programme in the Kalahari Suture Zone (“KSZ”), an operational update on the KSZ and a £1.94 million Placing.
Ø Expansion to drilling programme:
– A 550m borehole to be drilled through Target B1, following completion of operations at Targets A2 & C1 (announced 10 June 2021)
– Target B1 is 475m by 550m, with a conductance of approximately 8,200Siemens and decay constant estimated to be in excess of 350ms
– B1 is in a separate, distinct geological setting to the A-C corridor (announced 15 June 2021)
– Spectral Geophysics Ltd (“Spectral”) to perform immediate down hole electromagnetic (“EM”) surveys on each borehole on completion.
Ø Time Domain Electromagnetic (“TDEM”) survey update:
– Six Target Areas surveyed by Spectral
– Drill targets identified in Target Areas A2, C1 and B1
– No targets in Target Areas A1 and D
– Ongoing data analysis of Target Area B2
– Two further TDEM surveys planned in Target Area B, with one targeting Target B1.
Ø Strategic partnership discussions with Equity Drilling Ltd (“Equity Drilling”):
– Equity Drilling is owned and run by highly experienced African drill operators
– Kavango is in discussions with Equity Drilling concerning the formation of a strategic drilling partnership
– Kavango is considering a number of options, including (but not limited to) the possible acquisition of two drill rigs and support vehicles to act as a dedicated team across the Company’s portfolio of projects
– Any strategic partnership will be subject to due diligence and will likely be structured to involve payments in cash and shares
– Further announcement to be made in due course.
– 35,272,727 New Ordinary Shares (the “Placing Shares”) have been placed by First Equity Limited (“First Equity”), on behalf of the Company with institutional and other investors (the “Placing”)
– The Placing has been conducted at a price of 5.5p
– A one-for-one warrant has been issued to all placing participants, exercisable at 8.5p per share for a period of two years (the “Warrants”)
– The Warrants are subject to an acceleration clause, whereby if the Company’s shares close above 17p for 5 trading days, the Company may write to warrant holders at any time providing 10 working days’ notice of accelerated exercise, with 10 working days thereafter for payment
– The Company has raised gross funds of £1.94million
– Certain of the Directors intend to subscribe for shares on the same terms as the Placing.
Ben Turney, Chief Executive Officer of Kavango Resources, commented:
“Exploration results this year, across all our projects, have consistently surpassed our expectations. This culminated in Friday’s two announcements concerning the identification of Target B1 in the KSZ and seven drill targets at Ditau.
We are especially encouraged by the results of the TDEM surveys in the KSZ. While the conductance of targets A2, C1 and B1 appears to suggest they fall within the range of massive sulphides, we take a high degree of comfort from the “negative” results of A1 and D1. The fact that the TDEM surveys have selectively identified EM conductors gives us confidence we are using the right remote sensing technology to define specific drill targets.
While we must remain measured in our response to these upbeat developments, we must also make sure we are prepared for one or more positive drill results.
Although Kavango is already well financed, our budget was built around a specific work programme. We had planned for a certain amount of drilling in 2021, as we pursued our objective of “proof of concept” in the KSZ. However, it became clear to the board in recent weeks that our projects require much more extensive campaigns.
As a result we have advanced our discussions with Equity Drilling about instigating much larger drill programmes, to respond to the rapid progress we are making in the field.
In anticipation of increasing our drill activity, we completed this weekend’s financing at a minimal discount and an excellent price. This reflects the strength of our position.
With our general overheads already budgeted for, Kavango will now deploy the new funds into pursuing our ambition of making one or more major mineral discoveries.”
Designated Target B1 (“B1”), the conductive anomaly is 475m by 550m with a conductance of approximately 8,200Siemens. The decay constant is estimated to be in excess of 350ms.
Target Area B is roughly 12km from Target C1 (announced on 15 June 2021). Kavango believes Target Area B is in a separate, distinct geological setting to the A-C corridor.
The Company is in discussion with Equity Drilling & Mindea Exploration and Drilling Services (Pty) to extend the current drill contract to include drilling a 550m borehole into B1, to retrieve core from the bottom of the “Norilsk-style keel” of the intrusive body.
Spectral will undertake down-hole EM surveying on each of the drilled holes as soon as the drilling has been completed. The surveying will identify and measure conductors within a 300m radius of the probe as it is lowered down the hole.
TDEM Survey updated
Spectral has now completed eight TDEM surveys in the KSZ. This included:
– 3 TDEM surveys in Target Area A, including one follow up survey on Target A2
– 2 TDEM surveys in Target Area B, including one follow up survey on Target B1
– 2 TDEM surveys in Target Area C, including one follow up survey on Target C1
– 1 TDEM survey in Target Area D.
This resulted in the identification of 3 drill targets, designated A2, B1 and C1 (the “Drill Targets”). Kavango plans to drill these targets over the course of this summer.
No conductors were found by the TDEM surveys over areas A1 and D1.
Analysis of data gathered from area B2 is ongoing and the Company expects to release an announcement on this in the near future.
Spectral has deployed its team back to Target Area B to complete two follow up TDEM surveys.
Kavango and Spectral will begin discussions in the coming weeks about conducting more TDEM surveys elsewhere in the KSZ. This next phase of TDEM surveying is expected to commence later this year, once the Company has received results from analysis of drill cores obtained from the Drill Targets.
Discussions with Equity Drilling
Equity Drilling Limited is a company registered in Guernsey. The owners and operators of Equity Drilling are highly experienced drill operators in Africa.
Equity Drilling founded Mindea Exploration and Drilling Services (Pty) Ltd (“Mindea”), which is operated under the Botswana Citizen Economic Empowerment Policy. Mindea is the drill contractor, which Kavango has engaged to drill the Drill Targets.
Equity Drilling also established Africa’s first, internationally accredited Drilling School in Botswana, the Africa Mining and Drilling Institute (“AMDI”).
Having established a strong working relationship, Kavango and Equity Drilling are now in discussions concerning the establishment of a strategic partnership company (the “Strategic Partnership”) whose primary focus will be to complete extensive drilling operations across the Company’s portfolio of projects.
Details and terms of the Strategic Partnership are still under discussion, but Kavango will complete a period of due diligence prior to making any commitment. One proposal the Company is considering is the acquisition of two drill rigs, with support vehicles, to create a focussed drill team to complete extensive drilling across the Company’s portfolio of projects. Discussions are ongoing about this and if an agreement is reached Kavango expects to pay a combination of cash and shares.
It is anticipated that Equity Drilling will act as the exclusive operator of the Strategic Partnership, in whatever shape it eventually takes, should final terms be agreed.
The 35,272,727 New Ordinary Shares have been conditionally placed by First Equity Limited, on behalf of the Company with institutional and other investors, including high net worth and retail investors, to raise £1.94 million.
Each New Ordinary Share has, on a one-for-one basis, a warrant attached exercisable at 8.5p for a term of 24 months from the date of issue, which is subject to an acceleration clause whereby should the Company’s shares close above 17p for more than 5 trading days, the Company may at any time write to the warrant holders providing 10 working days’ notice of accelerated exercise, with 10 workings day thereafter for payment.
The Company is discussing with certain directors the possibility of their participating in a subscription, on the same terms as described above. If agreement is reached a further announcement will be made.
The Company has issued with 3,527,273 broker warrants (“Broker Warrants”), with the same terms as set out above for the Warrants issued as part of the Placing.
Admission and Total Voting Rights
Application will be made for the Placing Shares to be admitted to the Standard List segment of the Official List and to trading on the main market of the London Stock Exchange plc (“Admission”). It is expected that Admission will become effective and that dealings in the Placing Shares will commence at 8.00am on or around Monday 02 August 2021.
Following Admission, the total issued share capital of the Company will consist of 400,340,775 Ordinary Shares. Therefore, the total number of voting rights in the Company is 400,340,775 and this figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest, in the share capital of the Company.
Further information in respect of the Company and its business interests is provided on the Company’s website at www.kavangoresources.com and on Twitter at #KAV.
For additional information please contact:
Kavango Resources plc
+46 7697 406 06
First Equity (Joint Broker)
+44 207 374 2212
SI Capital Limited (Joint Broker)
+44 1483 413500
Kavango Competent Person Statement
The information in this press release that relates to “geological and/or geophysical results” for the LVR Project is based on information compiled or reviewed by Mr Mike Moles BSc (Geology) & BSocSci (African Studies), a competent person who is a Member of the Australian Institute of Mining & Metallurgy. Mr Moles has sufficient experience that is relevant to the style of mineralisation and type of deposits under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Moles consents to the inclusion in this release of the exploration results for the Project in the form and context in which it appears. Mr Moles is a beneficial shareholder of Kavango Resources plc.
Note to Editors:
THE KALAHARI SUTURE ZONE
Kavango’s 100% subsidiary in Botswana, Kavango Minerals (Pty) Ltd, is the holder of 14 prospecting licences covering 7,573.1km2 of ground, including 12 licences over a significant portion of the 450km long KSZ magnetic anomaly in the southwest of the country along which Kavango is exploring for Copper-Nickel-PGM rich sulphide ore bodies. This large area, which is entirely covered by Cretaceous and post-Cretaceous Kalahari Sediments, has not previously been explored using modern techniques.
The area covered by Kavango’s KSZ licences displays a geological setting with distinct similarities to that hosting World Class magmatic sulphide deposits such as those at Norilsk (Siberia) and Voisey’s Bay (Canada).
The Norilsk mining centre is about 2,800km northeast of Moscow and accounts for 90% of Russia’s nickel reserves, 55% of its copper and virtually all of its PGMs. Kavango’s licenses in the KSZ display a geological setting with distinct geological similarities to the magmatic sulphide deposits at Norilsk. Magma plumbing systems are a key feature of these deposits.
EM Super Conductors: are bodies of highly conductive minerals such as graphite, magnetite and metal sulphides, which conduct electricity very rapidly provided the mineral grains are in contact with each other.
Gabbro/gabbroic: A coarse grained, medium to dark coloured rock, formed from the intrusion of mantle derived molten magma into the earth’s crust. Gabbroic rocks (or “gabbros”) are formed as the molten magma crystallizes and cools.
Gabbroic sills: Relatively thin, planar, horizontal bodies of solidified gabbroic magma that intruded into layers of sedimentary rock whilst still molten.
Karoo: The Karoo System covers 1.5 million km2 of the semi-desert region of Southern Africa. Rocks in this system formed 180-310 million years ago.
Massive sulphide: When a deposit consists almost entirely of sulphides it is termed “massive”. When it consists of grains or crystals of sulphide in a matrix of silicate minerals, it is termed “disseminated”.
Metal/Magmatic sulphide: Deposits of sulphide mineral concentrations in mafic and ultramafic rocks, derived from immiscible sulphide liquids. To view a video of how metal/magmatic sulphides form please visit –
Norilsk Style: copper/nickel/PGE mineralisation associated with the intrusion into the upper parts of the Earth’s crust of mafic magma, which form magma chambers that sit below volcanic vents or fissures that extrude basaltic lava onto the surface (Hawaii is a possible modern equivalent). The Norilsk intrusions tend to have distinct morphologies, combining thin gabbro sills (wings) with deep keels (thought to be associated with feeder dykes) at the base.
Norilsk Model: a genetic geological model similar to that pertaining to the Norilsk/Talnakh deposits in Siberia. Traditionally, it was thought that, during emplacement, the magma incorporated sulphur rich country rock (e.g. coal measures) or evaporites into the melt, which allowed the molten magma to become sulphur saturated. The free sulphur would then combine, preferentially, with Cu/Ni/PGE metal ions to form metal sulphides, which, being heavy, tended to accumulate in traps or into the keel of the magma chamber. However, modern research suggests that the process might be more complex and may also involve changes of the chemical and physical properties of the magma during the introduction of new pulses of molten material from below. Such sudden changes may have caused rapid segregation of metal sulphides within and above the feeder dykes within the keel of the intrusion.
Sulphide mineralisation: If there is sufficient sulphur in the molten magma, it will tend to combine with metals (Cu, Zn, Ni, Co, Pb, PGEs etc.) to form metal sulphide complexes, which may coalesce to form massive sulphide deposits. If the melt is sulphide poor, the metals will be taken up into the silicate minerals that form as the magma cools and will not usually form economic deposits.