The Poseidon Nickel Ltd (ASX: POS) share price is dropping in early trade today after the company released a key announcement on its Black Swan site.
At the time of writing, shares in the nickel mining company are changing hands at 10 cents each which is around a 5% loss from the open.
That's a significant drop this morning after Poseidon shares started the day in the green before the jitteriness from investors crept in.
Here's what we know from Poseidon's camp today.
Poseidon Nickel share price slumps after exploration update
Poseidon outlined several takeaways regarding exploration and drilling progress at its Black Swan site.
It revealed two underground rigs are testing the "potential down plunge Silver Swan extensions and infilling existing inferred resources" at its Silver Swan resource drilling program.
The existing Silver Swan resources contain a total of "16kt Ni (Nickel) averaging 9.5% Ni spread over three resources".
These are the Tundra-Mute, Peking Duck, and Fledgling-Canard resources that are each covered in detail throughout Poseidon's update.
In addition, after Poseidon's downhole EM program completed an up plunge of its Golden Swan site, it explained there was "no significant anomalism detected".
Yet, it maintains that "prospectivity remains in untested areas of the Southern Terrace".
In respect to the Golden Swan resource, there's a delay in the finalisation of the maiden resource due to "unforeseen circumstances".
Investors can expect results of the maiden resource at this site to be released in the last week of October, according to the company's update.
Lastly, regarding its "Fill the Mill Strategy", work is continuing on its Bankable Feasibility Study on a 1.1Mtpa processing plant.
The 'base feed' for the study is "a combination of Black Swan open pit ore and Silver Swan Tailings" to be complemented with "high grade ore from both Golden Swan and Silver Swan".
Notably, Poseidon needs to first record a resource at its Golden Swan site to include in the base feed for the study.
What did management say?
Regarding the Fill the Mill Strategy, Poseidon Nickel managing director and CEO Peter Harold said:
The Fill the Mill Strategy for the Black Swan restart requires good confidence in our high-grade resources at both Silver Swan and Golden Swan so the mining studies can maximise the mining inventory and generate accurate mining schedules to assist in de-risking the restart.
Also touching on mineralisation finds at the project, Harold added:
New DHEM platforms have been established down plunge of the Silver Swan mineralisation and these are awaiting a geophysical crew to undertake the survey. The results of the survey could provide targets for extensional drilling. In the meantime, we have identified a good zone of mineralisation below the Black Swan open pit from previous RC drilling, undertaken in 2019, which could present an opportunity to increase the size of the pit and extend the proposed open pit mine-life. We can drill this zone from underground and will redeploy one of the underground rigs to undertake that drilling.
Poseidon Nickel share price snapshot
The Poseidon Nickel share price has delivered an outsized return of 54% since January 1, extending its gains in the last 12 months to 19%.
That's roughly in line with the S&P/ASX 200 Index (ASX: XJO)'s return of about 21% in that time.
