Why the Encounter Resources (ASX:ENR) share price is up today

The Encounter Resources share price has shrugged off concerns of Chinese copper restrictions to gain 3% on today’s drilling announcement.
The post Why the Encounter Resources (ASX:ENR) share price is up today appeared first on Motley Fool Australia. –

Miners working at the mine with an engineer representing mining share price

The Encounter Resources Ltd (ASX: ENR) share price is up 3% in afternoon trading. This comes following the company’s drilling update at its Yeneena Copper-Cobalt Project in Western Australia.

By comparison, the All Ordinaries Index (ASX: XAO) is up 1.1% today.

Shareholders in Encounter Resources and other ASX-listed miners with a focus on copper, like Sandfire Resources Ltd (ASX: SFR), received some unwelcome rumours this week courtesy of China’s media outlets. Those rumours have it that copper could join wine, lobsters, coal and barley on the Chinese government’s growing list of restricted Australian commodities.

China’s government has yet to specifically say so. But the consensus in Australia is these restrictions are punitive measures put into place as diplomatic relations between the 2 nations have grown strained over spying allegations, Australia’s Huawei 5G ban, and frictions over China’s alleged detention of a million Uighurs.

Nonetheless, Encounter Resources is charging ahead. Today’s gains see the Encounter share price up 63% year-to-date.

What does Encounter Resources do?

Encounter Resources is an Australian gold and copper exploration company. Encounter is moving forward with a promising group of projects in the Tanami and West Arunta regions of Western Australia in joint ventures with Australia’s largest gold miner, Newcrest Mining Limited (ASX: NCM).

What sent the Encounter Resources share price higher?

This morning Encounter announced it had started a diamond drilling program (up to 1,900 metres) at its Yeneena Copper-Cobalt Project in the Patterson Province of Western Australia under the earn-in and joint venture agreement with IGO Ltd (ASX:IGO).

Under the terms of the agreement, IGO can sole fund $15 million in exploration costs over 7 years to earn a 70% interest in Yeneena.

The diamond drill program follows on magneto-telluric (MT) and electromagnetic (EM) surveys which identified a range of promising new copper drill targets at Yeneena. An initial diamond drill program will test Tarcunyah’s multi-point copper anomaly as well as the Windsor EM target.

Encounter managing director Will Robinson said:

We are excited to be under way with diamond drilling at Yeneena. The compelling copper-cobalt drill targets to be tested are a result of the innovative application of modern exploration technologies in a highly fertile but covered terrain.

With Encounter’s share price rallying on the drill announcement, the test hole results will be the next ones to watch for.

Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.

Find out the names of our 3 Post COVID Stocks – For FREE!

*Returns as of 6/8/2020

More reading

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Why the Encounter Resources (ASX:ENR) share price is up today appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!