Gary Sutherland.
Gary Sutherland.

UPDATE 2.30pm: IMX Resources is the latest explorer to ride the wave of investor exuberance over graphite with its shares soaring on discovery of the mineral at its Nachingwea property in Tanzania.

The company, which last month placed its 51 per cent-owned Cairn Hill iron ore project in South Australia into administration, announced this morning it had found high-grade carbon (up to 29.6 per cent) in rock chip samples at Nachingwea in south-east Tanzania.

"A total of 41 rock chips returned grades of greater than 10 per cent carbon," the company said in a statement.

Graphite is made up almost entirely of carbon atoms.

Managing director Gary Sutherland said the identification of graphite mineralisation within the Nachingwea property further reinforced the outstanding prospectivity of the company's Tanzanian exploration portfolio.

"Coming hard on the heels of our significant gold target at Kishugu, these graphite results provide IMX with an outstanding suite of exploration targets," he said.

"We believe there is strong potential to define an economic resource within our extensive Nachingwea tenement package."

IMX said it would analyse data from a geophysical survey completed over Nachingwea to prioritise the strongest conductors which showed the greatest potential for large volumes and/or high grades.

"Drilling of priority targets is expected to commence in October," the company said.

Shares in IMX closed up 1.7 cents, or 89.47 per cent, at 3.6 cents after touching an intraday peak of 4.9 cents.

The West Australian

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