Interview with Managing Director - Michael Schwarz on Small Caps
In a heavily oversubscribed placement, Northern Cobalt (ASX: N27) has topped up its cash reserves with A$3 million to accelerate feasibility studies and exploration across its flagship Wollogorang cobalt project and its Arunta lithium and rare earth element tenements.
According to Northern Cobalt, the heavily oversubscribed placement attracted “strong support” from professional and institutional investors. Under the placement, 8.6 million shares were issued at A$0.35 each.
Additionally, a share purchase plan will be offered to current shareholders to enable them to access the same price as the placement.
Northern Cobalt hopes to raise $1 million via the share purchase and existing shareholders will receive full details of the plan next week.
Upcoming Wollogorang exploration program
Following the success of last year’s comprehensive 137-hole drilling campaign that kicked off in early October and wound up in December, Northern Cobalt plans to use its capital raising funds to widen its exploration scope by carrying-out a shallower but broader drilling program across its Wollogorang tenements.
Speaking with Small Caps Northern Cobalt managing director Mike Schwarz said a shallower exploration program would enable the company to efficiently cover more ground across its extensive Wollogorang landholding.
“In our upcoming exploration program, we are going to employ a Toyota-mounted rig and drive it around the project area and punch holes to about 20m.”
According to Mr Schwarz cobalt mineralisation grades intersected to-date were relatively uniform at surface and at depth. As such, the shallower drilling program would produce faster and less expensive results across a broader area.
“We can tell if we have the potential for a resource there just by drilling into the top 20m.”
Mr Schwarz said a week’s worth of drilling at a target area using reverse circulation rigs would take the company only a day using the smaller Toyota-mounted rig.
To hasten its exploration activities even further, Northern Cobalt has also employed a specialised XRF analyser to measure cobalt presence “pretty much instantaneously” while drilling – shortening the turnaround time for firming up targets.
As part of its strategy, Northern Cobalt plans to actively explore its southern tenements, which are believed to host larger deposits, by the final quarter of this year.
Mr Schwarz claims these southern tenements could potentially host deposits in the range of 10 million tonnes to 100 million tonnes.
“It’s called the Selby Stratiform Cobalt target. It is essentially what we’ve got at the Stanton deposit, but its covered by a cap.
“That means that the mineralisation is trapped underneath causing it to spread out horizontally.”
Mr Schwarz added the company planned to get on the ground at Wollogorang with the new Toyota-mounted rig by mid-next month, possibly earlier if weather permitted.