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A major attraction of any small-cap stock is its growth potential with investors aiming to substantially increase wealth in a short span of time.
Long on Leverage
With this in mind, Investors’ are beginning to identify one a small-cap explorer, Krakatoa Resources Limited (ASX:KTA) with a market cap of just ~$7m at ~4c. One drill hole announced by Alkane (ALK) at their Boda prospect in Sept 19 (502m @ 0.48g/t Au & 0.20% Cu) added ~ $200m to ALK’s value. ALK’s neighbor Magmatic Resources Limited (ASX:MAG) is currently capped at ~$33m at 22c.
Notable Nearology
Since the strategic decision to acquire the Belgravia Porphyry Cu-Au Project located in the Molong Volcanic Belt in NSW next to Copper Hill and 40Km North of Australia’s biggest Gold mine Cadia, KTA’s price has only risen ~50% so far.
KTA’s Belgravia sits along strike and ~70km South of the aforementioned ALK’s Boda prospect in the same Molong Volcanic Belt.
Belgravia is also located just 2km East of the aforementioned Copper Hill Porphyry Au-Cu deposit with significant drilling intercepts that include 60m at 5.4g/t Au and 1.83 Cu (source KTA website)
Encouraging Legacy Drilling
KTA recently discovered 4 historic drill holes done by Newcrest (NCM) in the 1990’s only 400m West of KTA’s Belgravia at Larras Lake that included one intercept 30m @0.20g/t Au from 163m.
Figure 1: Location of the Larras Lake Igneous Complex in relation to the Belgravia Project (Source: Company reports)
Recent Aeromagnetic Survey
A recent aeromagnetic survey flown by a drone has been announced that covered the Northern extent of Belgravia including parts of the Bell Valley and Larras Lake targets.
One would think that the purpose of this activity could be to seek out drilling targets.
Add KTA’s Promising Rare Earth Project
Prior to Belgravia, In 2019 KTA acquired the Mt Clere Rare Earth Project (subject to grant) which is prospective for three rare earth element (REE) deposit styles:
· Monazite sands in vast alluvial terraces
· Chinese-type ion adsorption clays in extensive laterite areas
· Carbonatite dyke swarm
And Investors Get
An impressive project portfolio with well-experienced Board and management marching towards KTA’s mission of locating, acquiring and developing high value mineral projects in order to produce significant value for its shareholders.
On 31 December 2019, KTA’s stock was trading at a price of $0.039, with a market cap of ~ $6.8 million.
Disclaimer
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