ARU THE NEXT BIGGEST DISCOVERY SINCE AREQUIPAAurelian “The biggest discovery story since Arequipa”
This article is an update from our Aurelian Special published in our latest issue.
by Willem Middelkoop
June 18, 2006
It’s quite unbelievable. We witness probably the biggest Gold Discovery in the last ten years and hardly nobody is aware. None of the paid newsletters we subscribe to mentioned the discovery by Aurelian Resources so far.
When we just did a Google News search on “Aurelian Resources” we got 25 hits, half of them publications of their regular press releases. Only the major Canadian brokers and their clients joined us and are buying all shares they can afford.
John Embry, of Sprott Asset Management, for example, owns almost ten percent. Worth more then 50 million Canadian dollars on a initial investment of around one million dollars. The stock is up over 4000 percent year-to-date. We still expect to double our money in the next months. Read here why!
In our latest issue we told you we were not sure yet if Aurelian was “The Discovery of 2006” since ECU Silver was also a nominee for this title. But after we went to press the drill results from hole 57 were published;
“Aurelian Intersects 189 Metres Grading 24 g/t 'Uncut' of Gold in Drilling at the Fruta Del Norte (FDN) Epithermal Gold-Silver Discovery”
The results caused shares to jump from thirteen to over twenty Canadian dollars. The stock is up an amazing 4300% year to date and more then 2000% since we introduced this company to you on February 4 earlier this year. Amazing indeed.
If you think the grades can’t get any better you’re quite wrong. The next drill results, are to be reported very soon. Aurelian already informed investors that hole 58, 59 and 60 all had visible gold seen in the core (see picture below), just like the core of hole 57 which turned out 24 grams per tonne.
visible gold seen in core
And since Aurelian reported that the grades are even getting better along strike we can expect grades up to 50 grams per tonne, since we have seen those reported in 2003 when the company intercepted 9 meters of 50 grams at another prospect in their very first drill campaign.
The exploration company has only some thirty million shares outstanding and twenty million in cash. The intersections discovered so far are approximately 1km north of the Bonza-Las Peñas (B-LP) deposit were a resource of half a million ounces of Gold was outlined some time ago.
The latest drill hole results followed previously released intercepts from holes 51 and 56 on which we commented in our latest issue.
“Virginia’s Eleonore deposit of 2-3 million ounces was sold for a good 400 million ounces. The Aurelian Condor project has to show at least the same number of ounces to justify the current share price since this deposit in situated in Ecuador and not in Canada. Most Aurelian stock is owned by insiders and institutional investors so there is very little free float. This situation won’t change till August, when the lock-up period ends, for more then seven million shares issued in the recent financing. As a result of the financing the company has over 20 million dollars cash, which will be used to speed up the drilling. Analyst estimate that the previously calculated resource of half a million ounces of Gold on the Condor property can be upgraded to a multi million deposit of at least two million ounce.”
We interviewed president and CEO Patrick Anderson for our previous issue and will republish it in this update since we believe it contains valuable information. He believes that the area constitutes a potential new mining district with the probability of hosting a mine of 'world class' calibre. A few weeks ago he already speculated about the possibility for a three to five million ounces deposit. Since then several analysts joined him and John Embry informed viewers of ROB-TV he even spoke to one analyst who expects a deposit of over seven million ounces.
This would mean this is one of the largest discoveries of the past decade. Should this be true you can expect shares to double from the current price of a little over Ca$20. We even think that after this amazing discovery the current share price is less risky than at $0.90 when we first introduced the stock.
The company expects to present a new resource estimate within a year. The drilling program has been increases strongly with a planned third and fourth rig arriving during the summer months. And don’t be surprised to see a take over offer in the next few months.
Interview with Mr. Anderson CEO and President of Aurelian Resources.
How impressed are you with the drill results?
I’m very impressed. This was a grassroots property started with almost no information. It has taken us years to collect data and fill our database and to find and rank our gold and copper targets. Our very first gold target of the year has these spectacular results which caused the dramatic upsurge in the price of our shares.
Why are they so spectacular?
We have quite high gold grades, over significant widths of up to 240 meters so far, but we haven’t drilled through this system so it could be quite a bit wider. We hope to grow this prospect to a new world class discovery and deposit.
Do you expect or do you hope it will be?
Every indication we have so far is that we are talking about a very big system.
Were you surprised by the results?
Yes, I was happily surprised. I was expecting some good news. I was very happily surprised at the strength of the mineralization. Historically we have had quite high grades; in 2003 we had intercepted 9 meters of 50 grams at another prospect in our very first drill campaign. But we weren’t able to repeat those results so downgraded that target, Aguas Mesas Sur, and concentrated on evaluating the potential for the rest of the 95,000 hectare property. We finished compiling the target ranking in November of 2005 and started to systematically work through the list starting in 2006.
These results are much stronger than Bonza- Las Peñas, they are twice the grade and much more width. We believe we are drilling into the top of an epithermal system, found the very top of the gold system, the bonanza grades, if there are any, would be expected to be found at a lower depth.
Do you expect that the deposit of Bonza- Las Peñas and the Fruta del Norte prospect, more than one kilometre apart, are connected?
That is our interpretation at the moment, but we can’t say for sure until we have drilled between the two systems. Looking at our geological model it looks to be they are along strike, they are connected yes. With this discovery we have added more than a kilometre of strike length to the Bonza- Las Peñas deposit that we targeted and drilled in 2004 and 2005. The intensity of the mineralization at Fruta del Norte is an order-of-magnitude stronger than we see at Bonza- Las Peñas. The current exploration area is interpreted to be the northern continuation of that system which has now been mapped for over 3km. To date, there has been no drilling between the current program at Fruta Del Norte and the B-LP deposit.
You already published a resource of a half million ounces from Bonza- Las Peñas, so if this is connected we can expect a few million ounces?
Yes, I have read that certain institutions are making that prediction. The drill is currently working to complete the final four holes of the program. These results will be released when they are received. Given the strength of the numbers reported so far we are working to develop a drill program that will identify a resource on this new discovery.
You don’t make a lot of promotion for your company, why is that?
Many people told us that is our weakness. We concentrate on our technical excellence. We try to do the right thing as dictated by geology and exploration results. In our case this has been a successful strategy as you can see good results are the best promotion. There was very little attention paid to our company before the FDN discovery.
Are you accelerating the exploration now?
Yes we have over C$20 mln in the bank after the PP. This will speed up the exploration by allowing us to employ more personnel, improve infrastructure and acquire additional drill rigs. The plan is to have at least two drill rigs defining a resource at FDN and as additional rigs become available we will begin to test our numerous other target areas. We have twenty other gold targets on the property and al least that many copper targets as well.
Do you have the idea you understand the geology of this property?
We are learning more every day. But look at the concept of Fruta Del Norte. We took our geological knowledge of the area and the models that we conceived of ourselves and we drilled a blind target and hit a blind target 200 meters under surface. I think that demonstrates a fairly good geological understanding.
Do you expect any problems concerning the changing political situation in Ecuador?
No, I don’t see any problems so far here in this country.
Background info:
Aurelian Resources Inc. is a Canadian gold, silver, and base metals exploration company that controls over 95,000 hectares of mining concessions in south-eastern Ecuador.
The company was founded privately by geologists Patrick Anderson (President and CEO) and Dr. Keith M. Barron (Director) in 2001. In February of that year they applied for their first concession in the Cordillera del Condor, where they made a virgin discovery of epithermal gold mineralization.
Subsequent exploration determined that gold mineralization lies within a major structural corridor of at least 30 kilometres in length. Since Aurelian went public in June of 2003, the company has continuously had geologists on the ground exploring the concessions and both finding new prospects and advancing those we had discovered previously.
Aurelian has grown its land holdings to 38 mining concessions and continues with its exploration campaign on multiple gold targets: high grade; potential large tonnage bulk mineable gold; and grassroots discovery level targets. The company believes that the area constitutes a potential new mining district with the probability of hosting a mine of 'world class' calibre.
The full version of the latest press release can be found at:
https://www.aurelian.ca/news.php
Some interesting quotes recently seen on several investors bulletin boards:
“Spoke to a guy at Canaccord, he said the people who cover metals in his office say that the numbers are better then good, he actually said "better them damn good.”
“Arequipa didn't even have 20 holes drilled and it was scooped. Grade there was 2.5 grams per ton. The higher the grade the higher the premium per ounce of gold. Barrick bought about Arequipa for a billion in 1996. I believe this deposit is already larger and higher grade. So far ARU has traced this zone for 400m with a vertical dimension averaging say 200m and widths probably exceeding 200m.”
From an Canadian broker:
“Yesterday's results represent one of the best drill holes we have seen in a very long timeframe (pastdecade). $18.25/share (assuming 3.1 million ounces in situ) and $29.50/share (assuming 5.0 million ounces in situ) can be calculated.”
“The strike of FDN is now 400 metres and we understand hole CP-06-60 is a further 100 metres to the north. The FDN discovery is very quickly taking on world class potential with, based on yesterday's results, significant
higher grade areas. As the zone appears to be coming closer to surface towards the north there may be potential for open pit extraction for some of this prospect though, again, this is purely an hypothesis at such an
early stage of exploration.”
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