In a September 9, 2022 research note, Research Capital Corp. analyst Adam Schatzker wrote that base and critical metals explorer and developerjust announced more good results from drilling at its Iberian Belt West (IBW) project's Romanera and Infanta deposits.
Research Capital Corp. indicated that it is maintaining its Speculative Buy rating on Emerita Resources Corp.
The analyst indicated that the company currently has nine drill rigs actively deployed at Romanera and one additional rig operating at Infanta and explained that the results released by the company on September 8, 2022, pertain to three holes at Romanera and two from Infanta.
The report from Research Capital mentioned that although the results from Romanera were good overall, it would have been helpful if more information had been made available that offered greater context for the drill results in relation to historical drilling at the site.
According to analyst Schatzker, two of three holes (LR009, LR013) drilled at Romanera were drilled from the same drill pad, and the third (LR015) was drilled in an area with lower historical density.
Drill holes LR009 and LR013 were drilled around 250m (meters) apart, and each recorded wide intercepts with good ore grades, when compared to the historical resource estimates, calling for 34 million tonnes (34 Mt) grading 0.42% copper (Cu), 1.1% lead (Pb), 2.3% Zinc (Zn), 0.8 grams per ton gold (0.8 g/t Au, and 44 g/t silver (Ag).
Assay result from hole LR009 returned 6.7 m of 3.90% Cu eq (equivalent) comprised of 0.3% Cu, 1.4% Pb, 4.2% Zn, 0.84 g/t Au and 102.4 g/t Ag and one other segment that registered 16.5m of 6.75% Cu eq containing 0.20% Cu, 3.10% Pb, 3.60% Zn, 2.29 g/t Au and 254.70 g/t Ag). In the core samples processed and analyzed, gold and silver accounted for 45% and 66%, respectively, of the Cu eq totals.
The company reported that drill hole LR013 intersected two wide intercepts that included 4.2 m of 2.07% Cu eq and 20.6 m of 2.22% Cu eq. Research Capital pointed out that these samples were slightly below the historic resource grade of 2.61% Cu eq. The report listed that hole LR015 targeted the western edge of historic drilling and did not encounter any significant amount of economic metal.
The analyst stated that the results from drill holes IN060 and IN061 at the Infanta deposit showed decent grades with only narrow widths, which Research Capital said were similar to recent drill results from that area. The firm suggested that it believes Emerita should search for new exploration targets at Infanta as the results appear to indicate that incremental drilling efforts are not adding significant value to Infanta.
Emerita has been subject to restricted operating hours due to weather-related issues, which do not currently permit drilling between the hours of 2:00 p.m. and 8:00 p.m. These restrictions are expected to be lifted before September 21, 2022, which will allow the firm to return to 24-hour operations.
Emerita Resources is a Toronto, Ont.-based resource company that is engaged in acquiring, exploring, and developing mineral properties in Europe. The firm is currently focused on polymetallic exploration along Spain's Iberian pyrite belt. The company's IBW project includes the Infanta, Romanera, and El Cura deposits. Emerita aims to acquire the Aznalcóllar project via a complex and tedious tender process that it has been working on for an extended period.
The analyst remarked that the company is well financed to conduct its 2022 exploration program and is expected to have a good amount of cash reserves at the end of the year. Research Capital noted that Emerita will likely need to raise additional funds if it continues forward with its aggressive exploration program or if it is successful in winning the tender for the Aznalcóllar project.
Research Capital Corp. indicated that it is maintaining its Speculative Buy rating on Emerita Resources Corp. but is reducing its prior target price by CA$0.25/share to CA$3.75/share. The research firm advised that it made the adjustment due to a reduction in the number of tonnes projected at the Infanta property.
Emerita Resources' shares trade on the TSX Venture Exchange under the symbol EMO. EMO shares have traded in a 52-week range of CA$0.083 to CA$4.14 per share and last closed for trading at CA$0.97/share on September 9, 2022.
The company's shares also trade in the U.S. on the OTCQB under the symbol EMOTF and under the designation LLJ on the Frankford Stock Exchange in Germany.
Emerita Resources is currently trading at CA$0.97.
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Disclosures For Research Capital Corp., Emerita Resources Corp., September 9, 2022
Analyst Certification: I, Adam Schatzker, certify the views expressed in this report were formed by my review of relevant company data and industry investigation, and accurately reflect my opinion about the investment merits of the securities mentioned in the report. I also certify that my compensation is not related to specific recommendations or views expressed in this report. Research Capital Corporation publishes research and investment recommendations for the use of its clients. Information regarding our categories of recommendations, quarterly summaries of the percentage of our recommendations which fall into each category and our policies regarding the release of our research reports is available at www.researchcapital.com or may be requested by contacting the analyst. Each analyst of Research Capital Corporation whose name appears in this report hereby certifies that (i) the recommendations and opinions expressed in this research report accurately reflect the analyst’s personal views and (ii) no part of the research analyst’s compensation was or will be directly or indirectly related to the specific conclusions or recommendations expressed in this research report. Adam Schatzker has visited Emerita Resources Corp. in the past 18 months.
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