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Shares in Arc Minerals (LSE:ARCM) were on the move on the London market this morning as the company reported what is being called the most significant copper sulphide discovery since the company started drilling four years ago. Arc said that initial XRF (X-ray fluorescence) data indicated significant grades of copper mineralisation.

Arc Minerals has been drilling in its Cheyeza East project in Zambia. The intersection is being described as supporting the thesis for a big mineralised system and a marker horizon for further drilling. Arc has a majority-controlled license on the site in NW Zambia.

Shares in Arc Minerals have soared on the news, from 3.32p yesterday to 4.16p this morning. Shares still have a long way to go to get back to their 52 week high, of 8.9p. The miner currently has a market cap of £46m.

Arc Minerals’ drill results at Cheyeza East

The first hole drilled at Cheyeza East, angled and orientated to intersect the interpreted stratigraphy perpendicularly, has been collared approximately 500 metres to the northwest of the 2019 oxide drilling campaign. The massive and disseminated sulphide mineralisation has been intersected at a down hole depth of approximately 275 metres at the contact between the dolomite and underlying mafic schist.

ARC Minerals current holdings include a 66% equity interest in Zamsort Limited, a private company focused on a prospective copper licence in the Zambia copperbelt, together with a convertible loan to Zamsort which converts into approximately a five percent additional equity interest in Zamsort. It also has a 72.5% equity interest in Zaco Investment Limited (“Zaco”), a private company focussed on a prospective copper and cobalt license adjacent to Zamsort.


The appeal of the Zambian copperbelt

Arc Minerals has a controlling interest in several licenses in sub-Saharan Africa. In the northwestern province in Zambia, its licenses are located in the Domes region of the Zambian copperbelt near world-class mines such as First Quantum Minerals’ Sentinel and Kansanshi copper mines and Barrick’s Lumwana mine. In Botswana, its licenses are located in the Kalahari Copper Belt, a region that has recently undergone an exploration transformation, with discoveries of copper-silver deposits making it an emerging world-class destination for new mines.

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Arc, via its Zambian subsidiaries, has a controlling stake over a total of 872 square kms of areas under licence located on the opposite flank of the Kabompo Dome to First Quantum’s Sentinel operations. In Botswana, through its Botswanan subsidiary, it has a controlling stake over 215k square km of area under license located within 15km and 38km respectively of Cupric Canyons’ Zone 5 copper-silver project and. north-east and along strike of Sandfire Resources NL T3 copper-silver project.

Copper miners, regardless of their location, are looking like hot properties at the moment. Investors in Arc Minerals are speculating that, if the results from assay look solid enough, larger players will become more interested in the property.

Arc Minerals has two warrant block listing applications – over 242m warrants have been issued, of which 37.6m have been exercised to date. The company has delayed publication of its interim results under AIM Rule 18 and will publish these no later than 31 October.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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