Why is the Caspin Resources (ASX:CPN) share price exploding 40%?

The mineral resources explorer is having a bumper day after announcing new copper, nickel and iron discoveries.

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The Caspin Resources Ltd (ASX: CPN) share price is skyrocketing today after the company provided an update regarding its Yarabrook Hill project.

Caspin shares are up a whopping 40.7% to $1.21 at the time of writing, creating a 160% yearly gain for the miner. Let's see what it's discovered.

Multiple sulphide zones

Caspin shares are having a party on the ASX after the company updated the market on its drilling targets at Yarabrook Hill in Yarawindah, Western Australia.

According to the company, it has intersected multiple broad sulphide zones over a 250 metre strikezone in one drilling target, and 120 metre strikezone at another. The sulphide intersections ranged between 1% and 3% volume, but were found as high as 15% in some areas, at various depths.

Caspin discovered disseminated copper sulphides, which it says are consistent with the platinum group (PGE) mineralisation style it is targeting in the region. The company noted that the sulphide minerals include "chalcopyrite (copper sulphide), pyrrhotite (iron sulphide) and pentlandite (nickel sulphide) hosted by mafic and ultramafic rocks."

According to the company, the fact these drilling holes are more than a kilometre apart suggests the Yarabrook Hill drill site may house a wide expanse of potentially lucrative minerals. As a result, investors have sent the Caspin share price soaring today.

Caspin's initial drilling is now complete and the company is awaiting assay results.

Management comments

Caspin CEO Greg Miles says this is just the beginning for the company's drill targets:

The two holes at Yarabrook Hill have delivered exactly what we wanted to see, that is, mafic and ultramafic rocks with broad zones of copper and nickel sulphide mineralisation which we believe is a good visual proxy for potential PGE mineralisation.

The holes are 1.25km apart, so the scale of the opportunity is significant. Now we wait with anticipation for the assay results. In the meantime, we are already planning the next work program. We are extremely grateful to have received a co-funded drilling grant through the WA Government Exploration Incentive This is going to allow us to drill the deepest hole at Yarabrook Hill to date which will give us a huge amount of new geological information as well as another opportunity for discovery.

Caspin share price snapshot

The Caspin share price has exploded today and has now reached the highest point in its six-month history on the ASX. The company's shares debuted on the exchange at 46 cents apiece before jumping from 60 cents in March to a previous high of 90 cents just last month. Overall, Caspin shares have gained around 124% in 2021 alone.

Motley Fool contributor Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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