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Kula Gold (ASX:KGD) shares were flat in early lunchtime trades as the company disclosed to market its new digs – a niobium project called Wozi in the African nation of Malawi.
Trades were highly illiquid on Friday with only around $4K worth of shares trading hands at 12.15pm AEST per Market Index data. It may be that with nearly 1B shares on issue and the stock reflecting penny status, investors are waiting for drill hits.
Niobium, for those out of the loop, is the critical metal that helped put WA1 Resources (ASX:WA1) on the map. Before that company came along with its WA-based (go figures) Luni deposit, it was thought Australia wasn’t really a major player for the metal, with most attention on Brazil.
That’s well and good for niobium-watchers who like to recite facts at parties (I don’t get invited to many these days,) but for Kula, it means the company could garner some enthusiasm – so long as it shores up a large enough deposit.
That isn’t outside the realm of possibility. Both Globe Metals & Mining (ASX:GBE) and DY6 Metals (ASX:DY6) have projects in the country that, if not niobium pureplays, pose the potential for niobium mineralisation discoveries due to underlying geology.
That, of course, requires a lot of faith to invest on alone, speaking to Kula’s Friday illiquidity. That said, YTD gains aren’t terrible.
Perhaps Wozi’s most promising indication – or it’s least promising, depending on whether you’re bullish or bearish – is that no historical exploration drilling to date has taken place.
Meanwhile, niobium has been found at surface coinciding with tantalum, according to Kula – but surface samples shouldn’t be considered as evidence of underground systems. (In fact, Australia’s JORC rules prohibit it.)
“Kula looks forward to quickly advancing the Wozi Niobium Project towards a maiden drilling programme to see what this exciting new critical minerals project can deliver for shareholders,” the company’s chief Ric Dawson said on Friday.
The company remains focused on its Mt Palmer Gold Project – but now with two plays on its books, the company risks the microcap trap of having too many stove burners on at one time.
KGD last traded at 0.7cps.
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