The Lotus Resources Ltd (ASX: LOT) share price is advancing today following a positive update at the Milenje Hills Rare Earth Prospect.
During morning trade, the mineral exploration company's shares broke into uncharted territory, touching the 35-cent mark. However, investors decided to quickly take profit off the table, leading its shares lower.
At the time of writing, the Lotus share price is up 1.59% to 32 cents apiece.
What did Lotus announce?
In a statement to the ASX, Lotus advised it has commenced exploration activities at the Milenje Hills Rare Earth Prospect in Malawi.
The new work program follows the significant discovery of high-grade rare earth oxide (REO) material in February. Lotus noted that from the 22 mineralised samples collected, REOs came up to 16%, with critical REOs up to 3.4%.
The 2021 program will see a number of works undertaken to determine the best path forward for Lotus. These include:
- Extension of the geophysical dataset to include additional survey lines over the large anomaly identified in initial work;
- Mapping in the broader area to define new mineralised zones;
- Additional trenching with an excavator in new zones as well as deepening some of the previous trenches;
- Reverse circulation (RC) drilling of up to 2,000 metres to follow up on selected anomalies and mineralised zones;
- Mineralogical test work and sizing (expected to commence in Q4 FY21); and
- Initial physical beneficiation tests (expected to commence in Q4 FY21).
Lotus managing director Keith Bowes commented on the news possibly driving the Lotus share price:
Whilst the company remains firmly focused on the development and recommencement of production at the Kayelekera Uranium Mine, we believe the Milenje Hills Prospect has the potential to add real value to the company for minimal expenditure.
Clearly, the initial results encountered at Milenje Hills were extremely encouraging, given both the grade and assemblage of rare earth minerals. The current work program will provide us with an enhanced understanding of the overall potential of Milenje Hills, prior to determining the optimal path forward to realise value for shareholders.
About the Lotus share price
Up until late August, Lotus shares were treading mostly sideways over the 12-month period.
However, in the past week, the Lotus share price has accelerated by around 50%. This has led its shares to record a year-to-date gain of 150% for investors.
