Enova enters due diligence phase for Brazil acquisition

Junior explorer Enova Mining (ASX:ENV) has officially kicked off its due diligence work for the potential acquisition of the CODA rare earths prospect in Minas Gerais, Brazil.

The due diligence work has begun just days after the $29.48 million market capitalisation company first announced the binding option agreement to purchase the project from private owner Rodrigo de Brito Mello. 

Enova’s team will investigate the field geology of auger drilling sites and drill samples from the area as part of the due diligence work. The company will also assess the location of historical deep diamond drilling, the data from which Enova is now able to access.

Enova plans to map ‘significant’ rare earth element (REE) outcrops, assess tenement prospectivity, and plan a forthcoming exploration plan and drilling work in the area. 

Further, Enova has appointed a new Exploration Manager with experience working in the Pocos de Caldas region as the due diligence work gets underway. 

The company today (4 March 2024) has also provided an update on its exploration activities concerning the recently announced acquisition (subject to shareholder approval) covering a significant and highly prospective REE (rare earth element) and lithium package.

The majority of the tenements are situated in the highly prolific Poços de Caldas Alkaline Intrusive Complex and the Lithium Valley.

With tenements secured in geologically prospective settings, and in proximity to other ASX explorers with established deposits of IAC REE and lithium minerals, Enova’s maiden drilling and sampling campaign work continues to confirm the IAC potential of Enova’s tenements.

Sampling has been ‘encouraging’ with abundant saprolite clay samples uncovered, a primary rock type for IAC enrichment.

Enova says the swift pace of exploration and professional expertise of the local Brazilian team confirm its confidence that the Minas Gerais region has established an experienced exploration team to undertake the future exploration program, subject to exercising the option to acquire the tenements.

Subject to its due diligence findings and commitment to acquire the project, Enova last week noted it plans to fast-track an exploration program at the new project and says its board is ‘confident’ in its ability to expedite its plans. 

The Mina Gerais region, according to Enova, has established exploration services and experienced personnel to help get groundwork underway

In this vein, the company says it’s already in talks with potential drilling contracts to finalise a tender in anticipation of a maiden drilling program at CODA, and discussions are underway with local landowners to potentially expand the project tenements where feasible.

As part of its acquisition announcement in February, Enova flagged some ‘significant’ aircore drilling results, which it says provide a ‘valuable’ advanced exploration target in the southernmost tenements, considered to be walk-up targets.

On-ground exploration has been in progress for over a month with a further three weeks of mapping, sampling and drilling to complete field work. When drilling is complete, samples will be sent as a batch to an international accredited laboratory for sample preparation and assay analysis.

The timeframe for analysis turn-around is subject to demand for services of
the assay lab. Enova expect to receive assay results by mid-April. Enova will review the field data and undertake a deeper drilling programme to check the depth of saprolite clays.

Enova also remains committed to the development of the Charley Creek rare earth project
with ongoing metallurgical characterisation work proceeding without disruption. The company will also continue to review projects and business opportunities as they arise, as is the case with the Brazil project.

Enova’s flagship asset remains its Charley Creek Rare Earths Project near Alice Springs in the Northern Territory.

At the end of December 2023, Enova had $939,000 cash and cash equivalents at hand, according to its latest quarterly report. 

Images: Enova Mining
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Written By Joshua Smith
Joshua Smith has years of experience in the media sector, having worked as a markets reporter, features writer, and editor since completing a Communications and Journalism degree and a Creative Writing degree. Josh is an avid board game fan and a self-professed coffee snob.