Red Mountain Mining to commence phase 2 drilling program at Mustang lithium project in Nevada
Red Mountain Mining (ASX: RMX) is preparing to commence a potentially value-adding drill program at its 100% Mustang lithium project in Nevada, USA.
Mustang was recently identified as a project that could add impetus to Red Mountain’s share price and the company is now on track to test that potential after the Bureau of Land Management in Nevada granted approval for a phase 2 drilling program in the permit.
Red Mountain has brought in local drilling company, Alloy Drilling LLC, to undertake an 11 hole program that has a maximum depth of target of 150m per hole as the company chases shallow lithium bearing clay horizons.
Upon completion of the phase 2 drill program, samples will be sent to Reno-based American Assay Laboratories for fast-tracked assaying, with results expected to be received by mid-November.
Research note highlights share price upside
A new note written on Red Mountain by East Coast Research, highlighted Mustang and Nevada lithium as holding the necessary prospectivity that could revalue the explorer.
In initiating its coverage of Red Mountain, East Coast estimated a 12-month target price of $0.0065 – a massive 62.5% upside from the current share price of around $0.0040.
The author of the report highlighted Nevada as a hub for claystone-hosted lithium deposits, and that Red Mountain has the potential for building maiden lithium resources through further drilling at Mustang.
Shallow lithium opportunity
Covering a significant 1,906 hectares, the vast Mustang project has been assessed to have the potential for shallow lithium mineralisation.
East Coast also noted Red Mountain’s success in strategically expanding the Mustang project footprint and increasing lithium scope.
“At the time of acquisition, the Mustang project comprised only about 38 claims. By the time it initiated Phase 1 drilling, the company had acquired an additional 102 claims, resulting in a total of 140 claims covering approximately 1,070 hectares.”
“In August 2023, the project expanded its footprint further by staking an additional 88 mining claims, resulting in a total area for Mustang comprising an impressive 228 mining claims, covering 1,9063 hectares.
“There is scope for further expansion since there are no other companies active in the vicinity.”
Drilling success highlights lithium strike
In July 2023, Red Mountain completed a successful maiden, phase 1 Reverse Circulation drilling campaign at Mustang which confirmed the presence of lithium that had initially been detected through surface sampling undertaken in February 2023.
Red Mountain identified significantly thick, high-grade lithium claystone in 8 out of 10 drill holes, with the majority of these holes consistently intersecting lithium mineralisation from or near the surface.
To date a strike distance of 1500 metres of lithium mineralisation has been uncovered.
Lithic block adds further value
East Coast revealed its Red Mountain valuation was entirely based on the potential upside at Mustang and did not take into account potential value that may be unlocked at Lithic and other projects in the Red Mountain portfolio, which includes two Australian rare earth element projects.
The research firm noted that surface sampling at the Lithic block, also located in Nevada, had provided very encouraging results.
The recently conducted Lithic surface sampling study saw ten of the collected samples exhibiting lithium concentrations exceeding 1,000 parts per million, with the sample containing the highest lithium content registering at 1,541 parts per million.
East Coast noted that the typical mineral resource cut-off grade for claystone lithium in the nearby Big Smoky Valley and Clayton Valley projects is approximately 500 parts per million.
With an important drilling program on the horizon, East Coast has declared Red Mountain as a company to watch.