S2 Resources (ASX:S2R) share price just rocketed 102% today. Here’s why

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The S2 Resources Ltd (ASX: S2R) share price roared to life today following an announcement by the mineral resource exploration company.

At Friday’s market close, S2 Resources ended the day up an astonishing 102.38% to 17 cents. It’s worth noting that its shares hit a 52-week low of 8.4 cents yesterday.

S2 Resources awarded Block 4

In its release, S2 Resources advised that its wholly-owned subsidiary, Southern Star Resources, has been awarded Block 4 of the North Central Victorian Goldfields Ground Release.

The Victorian Department of Jobs, Precincts and Regions handed over the 394 square kilometre block after S2 Resources won the tender. The competition comprised of a large number of Australian and international resources companies vying for the prime ground real estate.

S2 Resources said the land is considered to be the most prospective and highly contested gold ground in Australia.

Block 4 extends for 55 kilometres, surrounding the high-grade, Fosterville mine operated by Kirkland Lake Gold CDI (ASX: KLA)

The first priority for S2 Resources will be to apply for an exploration licence. Once granted, the company will then conduct a data review and target generation before commencing on-ground exploration activities.

The company is planning to spend a total of $10.4 million over a 5-year period to develop the site.

At the end of September, S2 Resources had $9.9 million in cash as well as a 13.5% interest in Todd River Resources Ltd (ASX: TRT). The latter is valued at $5.5 million based on the market valuation of the company.

What did management say?

Commenting on the news fuelling the S2 Resources share price, CEO Matthew Keane said:

We are humbled to have been selected based on our exploration track record and high focus on ESG. This is a highly prospective block situated in the historic and well-endowed Bendigo goldfields.

It has real potential for “company making” discoveries and S2’s highly experienced team is excited to get on the ground and commence work. This is an accredited gold exploration team, having been responsible for multiple gold mine discoveries in the past, including Thunderbox and Baloo in Western Australia and Wahgnion in Burkina Faso, as well as the major Nova-Bollinger nickel-copper mine in Western Australia.

About the S2 Resources share price

Despite today’s mammoth gains, a whirlwind 12 months has led the S2 Resources share price to track around 36% lower. Year-to-date it is up around 30%.

Based on today’s price, S2 Resources presides a market capitalisation of roughly $55.24 million, with approximately 356.38 million shares outstanding.

The post S2 Resources (ASX:S2R) share price just rocketed 102% today. Here’s why appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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