Canadian junior miner Sun Peak Metals’ (TSXV: PEAK) stock rose to its highest in nearly three years on Wednesday after announcing it is prepared to resume exploration activities on the Shire project in Ethiopia.
The flagship copper-gold project has been put on hold since November 2020 after a civil war broke out in the Tigray Region, resulting in the company invoking force majeure on all four of the exploration licences comprising the project.
Together, these licences (Nefasit, Adi Dairo, Terer and Meli) cover approximately 900 sq. km. of the prospective Arabian Nubian Shield in northern Ethiopia. The licensed areas are located on the same geological environment as both the Bisha mine (Zijin Mining) and the Asmara projects to the north in Eritrea.
In Wednesday’s press release, Sun Peak said it will restart exploration on three of those licences (Nefasit, Terer and Meli) in the first half of 2024. Proposed work includes drilling to test multiple copper-gold VMS targets previously developed by the company.
The remaining licence (Adi Dairo), as well as the two licences covering 550 sq. km. applied for prior to the conflict (Adi Mendi and Wokemba), are expected to have force majeure measures lifted at a future date, it added.
“We are very happy that the Tigray region is again peaceful and stable,” Sun Peak CEO Greg Davis said in the release. “Our Ethiopian team based out of Addis Ababa and Shire are available and supportive for a return to exploration activities. Multiple governmental and non-governmental agencies have been supportive of re-entering the region. We worked hard to keep our in-country technical team together, and we’re proud of our team’s resilience and dedication to the company.”
The company noted it that it recently completed an extensive security and safety assessment that confirmed low levels of risk in the licensed area and for the type of exploration drilling work to be accomplished.
As for funding, Sun Peak said it currently has approximately C$6.4 million in cash, so no near-term financings are required for the planned drill programs.
By 3:30 p.m. ET, shares of Sun Peak Metals had traded 50.3% higher at C$0.50 apiece, a new 52-week high and the highest since early 2021. This gives the company a market capitalization of C$42.5 million.
