Power Minerals (ASX:PNN) Hits Record Grades at Santa Anna- Buy the Discovery or Wait for the Resource?

Power Minerals hits record grades, but the maiden resource is key

Power Minerals (ASX:PNN) is sitting at an interesting crossroads. The stock surged nearly fourfold from its June 2025 low of A$0.055 to a peak around A$0.21, driven by a string of high-grade niobium and rare earth hits from its Santa Anna Project in Brazil. But a sharp pullback to A$0.10, sitting right on its recent placement price, has wiped out roughly half those gains, and the question investors now face is whether this correction has created a genuine buying opportunity or simply a return to reality for an explorer that got ahead of itself.

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Why Santa Anna’s Dual Mineralisation Could Be a Big Deal

What makes Santa Anna stand out is that it hosts niobium and rare earth elements in a single system, along with gallium and phosphate. That combination is uncommon and strategically valuable, since all four are classified as critical minerals by the US, EU, and Australia.

The project sits in Goiás State, Brazil, and that location matters. Brazil produces approximately 92 per cent of the world’s niobium supply, according to the US Geological Survey, and Power Minerals is exploring in the same geological system that hosts the world’s biggest niobium operations. The company holds 100 per cent of the Santa Anna Alkaline Complex, covering roughly 17 square kilometres, with about 90 per cent still untested. For a A$29 million explorer, that is a lot of ground to work with.

The Make-or-Break Moment: Does It Hold at Depth?

Here is the key risk investors need to understand. The headline grades that have driven the share price come from shallow auger drilling, which was capped at around 15 metres depth. Those results sit in the weathered zone near the surface.

While the grades are genuinely impressive for shallow work, including 3 metres at 15,436 ppm (1.54%) TREO within a 14-metre intercept from hole MN-TM-057 and 13 metres at 7,882 ppm TREO, no one yet knows if the mineralisation continues into the harder rock below. According to the company’s January announcement, only 34 of the 230-plus drill holes completed to date have tested below 51 metres depth, meaning roughly 2.4 per cent of the complex area has been explored at meaningful depth. That knowledge gap cuts both ways: it represents risk for investors who need certainty, but significant upside if deeper drilling confirms continuity.

This is where the next phase of work becomes critical. A 10,000-metre reverse circulation drilling campaign is now underway, with an initial 2,000-metre phase in progress. This deeper drilling will test whether the high grades extend beyond the shallow zone. If it confirms depth continuity, the project’s scale could grow significantly. If it doesn’t, the shallow results alone may not be enough to support the current valuation.

At the same time, SRK Consulting has been engaged to prepare a maiden Mineral Resource Estimate, drawing on 272 drillholes and over 8,480 assays. The company is targeting delivery this quarter, making it a near-term catalyst that could either validate or deflate the current market enthusiasm.

The Investor’s Takeaway for Power Minerals

The bull case centres on timing. If RC drilling confirms depth continuity and the maiden resource comes in strong, a A$29 million market cap could look cheap for a district-scale niobium-REE system in Brazil. The stock closed at exactly A$0.10, right on its placement price, meaning the speculative premium has entirely washed out. For contrarian investors, that is often where risk-reward starts to look interesting.

The bear case is equally straightforward. This is a pre-resource, pre-revenue explorer that will likely need more capital to advance. If deeper drilling disappoints, the stock has limited downside support, and dilution risk is real for any micro-cap at this stage.

We believe this is a speculative but interesting story for risk-tolerant investors, particularly after the pullback. The RC results and maiden resource timeline are the two catalysts to watch. They will determine whether Power Minerals earns a re-rating or gives back more ground.