The AVZ Minerals Ltd (ASX: AVZ) share price is underperforming on Monday despite the release of a positive announcement.
At the time of writing, the lithium-focused mineral exploration company's shares are down 2.5% to 18.5 cents.
What did AVZ announce?
Investors have been selling AVZ Minerals' shares this morning despite the release of an update on drilling activities at the Manono Project in the Democratic Republic of Congo.
According to the release, the company has received further strong results from its Mineral Resource drilling at the project.
The latest assay results come from the last three of the nine planned diamond drill holes at Roche Dure in previously undrilled areas beneath the historical pit. These were previously inaccessible and under water during the earlier resource drilling programs.
AVZ's Managing Director, Mr Nigel Ferguson, said: "The final assay results from these last three of the nine planned drillholes on the Roche Dure pit floor again show strong lithium mineralisation from the pit floor surface."
Mr Ferguson also revealed that the drilling results could lead to a higher-grade core being discovered.
He explained: "Additionally, drilling also reported higher grade portions developing within the northern portions of the orebody, and that these may even coalesce both up dip and along strike."
"This may present as the start of a much higher-grade core which will need further investigation to determine the possibility of finding more significant tonnages of high-grade feedstock, apart from those at Carriere de L'Este, that could feed the plant in its early years of operation to shorten the pay-back period," Ferguson added.
What now?
The company will now take these drilling results and rerun its geological resource model and revisit its definitive feasibility study.
"Now these assays have been reported they will be merged with our current database and we will rerun the geological resource model to reclassify that portion of the pit floor which was previously modelled as waste due to the lack of drilling information."
"Following on from the geology remodelling and coupled with the improvements to the plant design parameters, we will then check the previous mine design against the updated model to optimise the mine design, generate new ore reserves and revisit the DFS results," he concluded.
