Recently restructured Prophecy Platinum (NKL-V) has been on a share-price roller coaster ride since releasing a resource update on its polymetallic Wellgreen project in the Yukon.
The update unleashed seven straight days of gains for the company. Its share price leapt from 74¢ to $5.32, for a 619% increase on a total of 30.5 million shares traded. Share prices retreated on the eighth day of trading following a company-hosted conference call, falling $2.07, or 39% on the day, to $3.25 with 5.3 million shares traded.
The activity was sparked by the new resource on Wellgreen, which added to the inferred and indicated resources on the East zone, and estimated a first resource for the less-explored West zone.
Using a 0.4% nickel equivalent cut-off, the study estimates that the East zone hosts 14.3 million indicated tonnes grading 0.99 gram platinum per tonne, 0.74 gram palladium per tonne, 0.52 gram gold per tonne, 0.69% nickel, 0.62% copper and 0.05% cobalt. That makes for contained metal totals of just over a million oz. combined platinum, palladium and gold, as well as 220 million lbs. nickel, 200 million lbs. copper and 15.8 million lbs. cobalt.
The inferred resource for the East zone is estimated at 219.3 million tonnes grading 0.54 gram platinum, 0.45 gram palladium, 0.26 gram gold, 0.39% nickel, 0.34% copper and 0.03% cobalt.
The less-explored West zone has an estimated 69.9 million tonnes at 0.5 gram platinum, 0.34 gram palladium, 0.12 gram gold, 0.34% nickel, 0.38% copper and 0.02% cobalt.
Combining the East and West zones, contained inferred metals total 2.42 billion lbs. nickel, 2.23 billion lbs. copper, 191 million lbs. molybdenum and almost 11 million oz. combined platinum, palladium and gold.
The rally comes less than a month after the company completed thorough restructuring, including a merger of companies, a name change and a 10-old-for-1-new share rollback. Prophecy Platinum is the result of Prophecy Coal‘s (PCY-V) North American assets with Pacific Coast Nickel.
Prophecy Coal controls roughly 45% of Prophecy Platinum shares, while John Lee remains chairman of both companies. Prophecy Coal acquired the Wellgreen project in September 2010, following a takeover of Northern Platinum.
The Wellgreen resource was based on 53,222 metres of drilling over 702 holes completed by owners of the project between the late 1960s and today, which has included HudBay Minerals (HBM-T, HBM-N), Chevron (CVX-N), All-North Resources, Galactic Resources, Coronation Minerals, Northern Platinum and Archer, Cathro and Associates.
HudBay developed the project into a mine in the 1970s as a base metal project, but pulled the plug after encountering low metal prices, excessive dilution and unexpected erratic distribution of massive sulphide lenses.
Between 1972 and 1973, HudBay mined 172,000 tonnes at 2.23% nickel, 1.39% copper, 1.3 grams platinum and 0.92 gram palladium. It also mined gold and other precious metals.
Before the latest update, Wellgreen hosted 6.4 million indicated tonnes grading 0.45% copper, 0.43% nickel, 0.31 gram palladium and 0.38 gram platinum, plus 24 million inferred tonnes at 0.28% copper, 0.29% nickel, 0.27 gram palladium and 0.38 gram platinum.
Prophecy Platinum started an 8,000-metre drill program in early June, to expand and infill the resource at the 22.1-sq.-km property.
Wellgreen is contained within the Kluane ultramafic belt, with the deposit occurring along the lower margins of a 20-km-long ultramafic-mafic intrusion known as the Quill Creek complex. The technical report describes the deposit as a gabbro-associated nickel deposit, with parallels to the Norilsk nickel deposit in Siberia. The main deposit runs 4.2 km long and up to 700 metres wide.
The project is located within the Kluane Game Sanctuary, 311 km northwest of Whitehorse and 25 km north of Kluane National Park. A 14-km gravel road leads to the property from the Alaska Highway, while the nearest port is Haines, Alaska, 410 km southeast. The operation is powered by generators, with the power grid ending 125 km southeast at Haines Junction.
Prophecy Platinum also owns the Lynn Lake nickel project in Manitoba, the Las Aguilas nickel-PGM project in Argentina and property in Uruguay.
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