The AVZ Minerals Ltd (ASX: AVZ) share price is on course to end the week on a high.
At the time of writing, the lithium-focused mineral exploration company's shares are up 8% to 20 cents.
Why is the AVZ Minerals share price surging higher?
Investors have been buying AVZ Minerals shares this morning following the release of an update on drilling activities at the Manono Lithium and Tin Project in the Democratic Republic of Congo.
According to the release, the company has received further strong results from its Mineral Resource drilling at the project.
The release explains that these assay results come from the first four of nine planned diamond drill holes in previously undrilled areas beneath the historical pit. These areas were previously inaccessible and under water during the earlier resource drilling programs.
AVZ's Managing Director, Mr Nigel Ferguson, explained the significance of these drilling results.
He said: "These drilling results, combined with the pit floor mapping, confirm the pit floor "wedge" is in fact made up of pegmatitic rock that historically was mined as tin-bearing feedstock."
"This area had previously been categorised as waste material in our current mining and financial model due to a lack of drilling data and under our current model, is pre-stripped as waste before ore can be sent to the processing plant."
"These positive drill results unequivocally demonstrate this is not the case and this material may be remodelled with increased confidence as revenue generating ore once all of the assay results are returned," he added.
What now?
AVZ Minerals will now collate the data and re-run the models to calculate both geological resources and then mineable reserves to be fed into the optimised feasibility study.
Management advised that this could potentially lead to increased indicated resources available for conversion to probable mineable reserves. It could also lead to an increase in its discounted cashflow as the previously assigned waste becomes mineable ore.
And finally, it has the potential to result in an increased mine life with lower operating costs and an increased open pit volume.
The optimised feasibility study is expected to be released later this year.
