Sirius soars on nickel discovery

Sirius Resources shares jumped after the company announced a new nickel sulphide discovery at its Frasers operation. Managing director Mark Bennett reported 138 metres of mineralisation in the new zone, named Bollinger, which prompted strong investor interest and a sharp share-price rise.

The Bollinger zone is the name Sirius has given to the new nickel sulphide zone discovered at its Frasers operation. The discovery is located near the Nova project in the southeast of Western Australia.

Sirius reported finding 138 metres of mineralisation at the Frasers operation, according to managing director Mark Bennett.

After the discovery was announced, Sirius shares rose by 79 cents to close at $2.85, and traded as high as $3.09 during the day.

Sirius said in December it was encouraged by metallurgical test results on the Nova nickel-copper mineralisation. Encouraging test results can improve the outlook for processing economics and investor sentiment, though the company noted the results as a positive development rather than a final assessment.

Hartleys analyst Mike Millikan said any new good-grade nickel and copper acreage would have a positive effect on Sirius’s share price, reflecting how market sentiment often responds to promising exploration results.

In July last year Sirius had just three staff and about $1 million in the bank while its share price was near 5 cents. The company’s fortunes shifted after it announced the Nova discovery, and the recent Bollinger discovery has further boosted investor interest.

Exploration announcements can cause large, rapid share-price moves—positive results tend to lift prices, as happened with Sirius. However, early discoveries require further drilling, testing and evaluation before they become producing assets. Investors should consider the company’s follow-up plans, technical results, financing needs and analyst commentary when assessing risk and opportunity.