Shares for Metalstech Ltd [ASX:MTC] gained 500% yesterday after a trading halt.
The Metalstech share price soared from $0.014 to close at $0.084. Today shares are trading around 21% lower at $0.066, at time of writing.
What happened to Metalstech Shares?
Metalstech is a junior exploration company with an $8.02 million market cap. The reason for the Metalstech share price surge was that the company announced they’ve signed an option to acquire 100% of the Sturec gold project in Slovakia.
The acquisition, which is a move from the company to get into gold exploring, adds to their Cancet Lithium project in Canada.
The Sturec gold project is located in central Slovakia, about 150 km northeast of Bratislava.
According to the announcement from the company, Sturec is an advanced gold asset. The mine has produced to date over 1.5 million ounces of gold and 6.7 million ounces of silver.
Back in April 2014, the UK’s SKR Consulting Limited carried out a Mineral Reserves estimate at Strurec. Here is a summary of the JORC (2004) Mineral Reserve estimate from SRK Consulting Limited:
Source: Metal Tech
Metalstech is looking to fund the project through a $1.75 million cash refund they’ve received from Revenue Quebec and are looking to get an extra $200,000.
What could happen next for MTC?
Here is what the company’s Chairman Russell Moran said on their new acquisition:
‘Assuming we are satisfied with our due diligence, Sturec has the potential to deliver strong shareholder value given the current outlook for the gold sector and the advanced nature of the asset. Strurec is a large scale, advanced development gold project which boasts significant exploration upside.’
Metalstech has 45 days to complete due diligence.
Markets have certainly taken the news well.
It’s a move to diversify at a time when gold prices are rising. In the last year, gold has seen its price go up in Australian dollars by 28.33%. Rising gold prices would bring more upside for gold explorers.
Where could gold prices go?
Gold expert Jim Rickards is forecasting that gold prices could hit US$10,000 in the next years. In this exclusive interview with editor Greg Canavan, Jim explains why.
You can watch it here.