CGN tanks -25% as 700m deep drillhole comes back up lacking sparkle

Microcap explorer CGN Resources (ASX:CGR) has failed to win market favour with shares down -25% to 23cps on the back of subpar drill results.

The company reported on Monday that it had completed a 708m deep drillhole at the Surus target of interest, described as an iron ore-copper-gold (IOCG) target on CGN’s website.

Surus is part of the company’s polymetal Webb project.

However, the company appears to have come back to the market empty handed, even as the core is now in transit to an assay lab.

In short, CGN said only that between 415–558m depth the company observed “a thick sequence of interbedded carbonate rocks, siltstone, mudstone and chert [part of] the Bitter Springs Formation.”

What it didn’t mention finding evidence of was any iron ore, nor gold, nor copper.

What the company did go on to say is that RC drilling now takes the main focus for the exploration team, with the Shep and Hathi targets now being watched.

Shep is prospective for nickel while Hathi is prospective for rare earth elements (REEs.)

The drill rig is sniffing around an area of Shep where a drillhole from November last year intersected 2m at 1.18% nickel – by all counts, a brief intersection. The total drillhole length hit 30m depth.

Following drilling at Shep, the rig will move to Hathi to sniff out any rare earth upside. The company, also in November of 2023, hit a larger core section at 37m length which sampled for 0.38% total rare earth oxides (TREO.)

Finally, the drill will then prepare diamond drill collars at the Snorky and Horton targets, which see the company going back to prospective IOCG targets.

The project is located in the northeast of WA straddling the border near Darwin, though far south from the coast.

CGN Resources last traded at 23cps.