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Western Areas share price blasts 14% on successful drilling results

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The Western Areas Ltd (ASX: WSA) share price has jumped by 14.94% to $2.66 per share at the time of writing. This significant jump comes on the back of the miner reporting successful drilling results from its Sahara prospect within the Western Gawler project in South Australia. 

What did Western Areas report?

The company discovered over 200 metres (down-hole length) of nickel and copper-bearing sulphides at the Sahara prospect within the Western Gawler Project. This was the first diamond hole completed by the company on the lluka farm-in and joint venture ground. 

Western Areas managing director Mr Dan Lougher said:

This is an excellent result from our first drill hole at the Sahara prospect, intercepting broad widths of nickel and copper bearing mineralisation. We keenly await the assay results, but it is already clear from what we have seen in the drill core, that we have a significant exploration result that merits immediate follow up work.

Importantly, we originally targeted this area due to its geological similarities to the Nova-Bollinger and Nebo-Babel nickel/copper deposits and this result adds to our belief that this area could host similar mineral accumulations. A lot more work is required to determine the extent of this mineralisation and we are in the process of updating our exploration plans to focus on this area.

According to the company, the drilling site was selected following an extensive campaign of target generation and assessment in 2019. The diamond drilling project commenced at Sahara on 10 June.

Western Areas reports that it is highly encouraged by these results, commenting that they vindicate its “long-held belief that the Fowler Domain has the potential to host significant magmatic nickel and copper sulphide accumulations.”

The Sahara prospect lies within 10km of the Trans Australian railway.

How has the Western Areas share price performed recently?

The Western Areas share price is up 60% from its 52-week low of $1.62, however, it is down by 11%, year to date. It reached a 52-week high of $3.48 in October 2019. Since 2015, the Western Areas share price is down by 22%. 

At its current share price, Western Areas trades on a fully franked trailing dividend yield of 1.3%. 

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Motley Fool contributor Chris Chitty has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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