Oceana’s Serra Negra footprint doubles as four rigs target a maiden resource

Serra Negra footprint expands beyond 4.5 square kilometres

Oceana Metals Limited (ASX:OCN) has turned a promising re-assay program into a much larger exploration target, with known rare earth mineralisation at Serra Negra now extending across more than 4.5 square kilometres. The company says the footprint has doubled, while a new mineralised zone has emerged north-east of the Central REE target.

The latest results include 32 metres at 2.7% total rare earth oxides, or TREO, within 122 metres at 1.2% TREO in historical hole L179. Another hole returned 106 metres at 1.0% TREO from 18.9 metres. At LG31, Oceana reported 26 metres at 1.4% TREO plus 0.63% niobium pentoxide, with peak assays reaching 10.59% TREO and 6.39% niobium pentoxide.

The results build on the September footprint expansion, which identified mineralisation outside the previously known Central target. The company says the historic holes were not drilled specifically for rare earths, and true widths have not been established. The re-assay results are exploration results, not a Mineral Resource or Ore Reserve.

Four rigs now test the Central REE target

Oceana’s maiden rare earths-focused drilling program began in early September with two man-portable diamond rigs. Since quarter end, a third and fourth rig have mobilised, with all four now working across the 1.5-kilometre by 1.5-kilometre Central target. Nine holes had been completed by the time of the report, and samples were being sent to laboratories weekly.

The approximately 20,000-metre program is designed to test continuity in the weathered carbonatite units around the LG42 and LG26 intersections and support a maiden JORC Mineral Resource Estimate. Those earlier results included 50 metres at 4.0% TREO within 114 metres at 2.3% TREO, and 22 metres at 4.7% TREO within an 84-metre mineralised zone.

With the four-rig drilling campaign now under way, assay results from the maiden program are expected throughout the fourth quarter of 2026. Results from the remaining 45 historical holes, covering roughly 4,750 metres of core, are also expected in the coming months. Oceana says re-sampling the available core has saved at least A$2.5 million in estimated drilling costs.

Acquisition closes while mining-right amendments remain pending

Oceana completed its acquisition of 100% of Songeo Mineração, the holder of the Serra Negra project, after quarter end. The transaction involved US$2.95 million in cash and 15,537,600 Oceana shares issued at a deemed price of A$0.36 each. A further US$2.25 million may become payable if project milestones are reached, including the announcement of a maiden JORC resource and a resource of at least 100 million tonnes at 4% TREO or equivalent.

The transaction is not entirely free of unfinished business. Oceana waived a condition requiring formal responses from Brazil’s ANM regulator on two mining rights because those responses had not arrived. The company expects a decision on amendments to include rare earth elements and niobium in the first quarter of 2027, while acknowledging that timing and outcome are not certain.

Another 4,462,400 shares originally contemplated as consideration relate to a third-party entitlement that Oceana is seeking to settle in cash on deferred terms. Binding documentation had not been executed when the report was released. The vendors also retain a 2.5% net smelter royalty over production from the project, excluding iron ore, while a separate 1% royalty was granted to Karri Capital for acquisition facilitation services.

Placement funds support accelerated exploration

Oceana ended September with A$17.991 million in cash after receiving A$12.637 million from the second tranche of its A$20 million placement. The quarter produced net operating outflows of A$1.944 million and net investing outflows of A$808,000, with the company reporting approximately seven quarters of funding based on its Appendix 5B calculation.

That cash position was measured before the post-quarter-end US$2.95 million acquisition payment and before the continuing cost of four active rigs. The placement is funding the acquisition, historical core re-assays, geophysics, drilling and working capital. Oceana also completed a 1,304-line-kilometre drone LiDAR and magnetic survey, with inversion modelling intended to feed a broader geological model.

For now, Serra Negra’s investment case rests on converting wide, high-grade exploration intersections into a coherent resource. The next evidence will come from the pending historical assays and new drilling, while the ANM decision and unresolved consideration arrangement add separate transaction and permitting variables to an otherwise accelerating exploration program.