Strategic Energy Resources to accelerate Achilles 1 exploration following $2m funding boost

Strategic Energy Resources (ASX: SER) has received firm commitments from institutional and sophisticated investors to raise $2 million for exploration at the advanced Achilles 1 polymetallic prospect in New South Wales’ South Cobar Basin.

The raising is being conducted via a two-tranche placement of 181 million shares priced at $0.011 each, representing an 8.3% discount to the company’s last traded price of $0.012.

It is being cornerstoned by resources investors Datt Capital (a major shareholder in Strategic) and Lowell Resources Fund.

Datt partner and head of research Tony Gu has been appointed a non-executive director on the Strategic board.

Proceeds from the capital raising will be used primarily to explore the Achilles 1 copper-gold prospect, previously drilled by Western Plains Gold in 2005 with peak values of 0.33% copper from 90 metres to 92m, within a 64m zone averaging 0.10% copper from 76m to 140m, proximal to the target.

Strategic has since completed a follow-up soil geochemical survey with 250 samples that revealed an 800m strike extent gold-in-soil anomaly with a peak value of 17.4 parts per billion gold.

Strong investor demand

Strategic managing director Dr David DeTata said the raising had exceeded expectations.

“The strength of investor demand for this placement is a clear signal to us that the Achilles 1 prospect needs to be drill-tested,” he said.

“Outstanding drill results to the north at Achilles 3 show the potential for the South Cobar region to hold multiple discoveries.”

“With the funds received, we are now fast-tracking our exploration plans in that area.”

South Cobar licences

Strategic was awarded the South Cobar exploration licences in January 2021.

The project is considered to be “key ground” at the southern end of the Cobar Basin, covering 287 square kilometres of fertile stratigraphic sequences of the Cobar Supergroup and immediately adjacent to the undeveloped Browns Reef zinc-lead-copper volcanic massive sulphide deposit owned by Eastern Metals (ASX: EMS).

It lies along the Achilles shear zone that hosts the prospective Achilles 2 and Achilles 3 prospects owned by Australian Gold and Copper (ASX: AGC).

In May, Australian Gold announced high-grade gold-silver-lead-zinc intercepts at Achilles 3 from a nine-hole reverse circulation program for 1,461m, including a best result of 5m at 16.9g/t gold, 1,473g/t silver and 15% lead-zinc from 112m.

Drilling returned maximum grades of 45g/t gold, more than 3,000g/t silver and 38.8% lead-zinc.

“This is a great result which bodes well for Strategic and the Achilles 1 prospect as we prepare to test this target in the coming year,” Dr DeTata said.

Exploration grant

Strategic was awarded a $120,000 grant in January 2022 under the NSW government’s co-operative drilling program to fund exploration at Achilles 1 but was unable to drill due to severe weather conditions.

The work was designed to follow a soil geochemistry survey over the target area that used Ultrafine+ next-gen analytics developed by the CSIRO.

The survey identified a significant coincident copper-gold and multi-element anomaly extending 800m along the Achilles shear untested by previous drilling.

It was reported to be associated with anomalous copper, lead, zinc and silver, as well as anomalous pathfinder chemistry including arsenic, bismuth, molybdenum and tungsten.

Strategic said the results “strongly suggest” the presence of a Cobar-style, structurally-controlled polymetallic copper-gold mineralising system.

Challenging work

Strategic Energy Resources was established in 1991 to explore for minerals hidden deep under cover rocks.

Dr DeTata said the work was not for the faint-hearted.

“It is expensive, many traditional techniques do not work, and any discovery must be large and high quality,” he said.

“Nevertheless, we have made a deliberate choice to focus on this search space as we believe it is where the next generation of giant deposits will be found.”

‘Undercover explorer’

The company has labelled itself a “specialist undercover explorer and project generator” hunting for major copper-nickel deposits in the greenfield frontiers of Australia.

“Few others are searching in the same space and this has allowed us to secure the best ground, get the best people and do the best science,” Dr DeTata said.

“Our farm-in and joint venture agreements provide the funding to systematically explore our large project areas while retaining exposure to discovery upside.”

“That allows us to do what we do best, which is identifying high-quality greenfield projects, scientifically adding value to them and then partnering with a major mining company for development.”