Aurania Resources (ARU-V) Jan 5, '18 Comments on Increase in Market Activity web.tmxmoney.com
Aurania Resources skyrocketed on Thursday after a senior analyst at the Casey Report recommended to his subscribers that they buy the junior for up to $15 per share. The stock, which opened at $3.20 per share, soared to a 52-week high of $7.57, before closing at $5.00, a 61.2% increase.
“He put a target price on the stock and said it was something worth watching and literally within minutes the stock took off,” “It was quite scary for a while and we sent the report to IROC as soon as we got it.”
The Casey analyst and editor, E.B. Tucker, said he met Aurania’s CEO, Keith Barron, about a month ago in London, when the company’s shares were trading at $2.45.
“With less than 23 million shares outstanding, if Aurania hits the mother lode in Ecuador, its shares will explode,” Tucker commented, adding that Barron has “found a billion-dollar mine before in the same region.”
“He thinks he can do it again,” Tucker mused. “For that reason, he’s not letting go of shares unnecessarily.”
Barron, who co-founded Aurelian Resources in 2001 and along with Stephen Leary and Patrick Anderson discovered the multi-million ounce Fruta del Not gold deposit in Ecuador in 2006, sold the project two years later to Kinross Gold (K-T) for $1.2 billion.
The exploration geologist has now staked 200,000 hectares or about 1.5% of Ecuador’s total landmass in the Cordillera de Cutucu, about 90 km to the north of Fruta del Norte, now owned by Lundin Gold (LUG-T) and sitting in the adjacent Cordillera del Condor.
Barron is hunting for two famous gold-mining areas or “Lost Cities” that Spanish documents and maps from the 16th and 17th centuries refer to as Sevilla del Oro and Logrono de los Caballeros. Logrono was considered the richest gold mine in the Spanish Empire and Barron’s 12 years of research has taken him to libraries in Quito, Lima, Madrid, New York, London, and the Vatican in Rome.
“The Aurania story is a little bit different from many other exploration stories in that it has a historical basis,” Spencer told analysts and investors attending a Red Cloud investment forum in Toronto in late October. “Keith was based in Ecuador in 2003 and started to hear about the so-called seven lost cities from the Spanish colonial days and he started doing some research into this because they had found some month-end reports produced by the Spanish in the late 1560s that talked about the amount of gold that had been produced from two areas—Logrono and Sevilla. Not only were there actual month-end reports about the amount of gold that had been produced over a forty-year period or so, but there were historic descriptions of how to get to these places…and some of the documentation, apart from these descriptions, were old historic maps.”
Spencer pointed out that a map from 1584 shows two landmarks that still exist today—Quito (now Ecuador’s capital) and Camora (now spelled Zamora)—which Aurania can use as two fixed points to put everything else into context. The ancient map also shows a river called El Pongo, one of the only rivers in southeastern Ecuador that flows north-south.
“The location for Sevilla and Logrono are on the east side of the river and the other crucial thing about this map is that that last chain of mountains is the Cutuco ridge, which is in the middle of the our project area and it’s the last mountain chain before you get into the Amazonian flatlands that go on for a couple of thousands of kilometres,” Spencer said, “so although this map is certainly not accurate, in some contexts it’s absolutely accurate and critically important.”
Spencer explained that while Aurania’s concession area was defined on the basis of the historic data from the mid-1500s, the company believes that it is also the geological extension of the Cordillera del Condor to the south, where Barron and his team found Fruta del Norte.
Cordillera del Condor is a mineral belt that isn’t that well known although it contains 27 million ounces of gold in 43-101 resources and 30 billion pounds of copper in 43-101 resources, Spencer added. “It is a phenomenal mineral belt and we have the geological extension to that in an area that hasn’t undergone recent exploration.”
Spencer also pointed out that Fruta del Norte was a blind discovery, where the gold mineralization started at a depth of around 150 metres. That discovery, along with a chain of copper porphyry deposits encompassing San Carlos, Mirador and Panantza, were made through fieldwork and stream sediment sampling, without having the benefit of geophysical data.
“With hindsight we can see that the Fruta del Norte deposit formed in a pull-apart basin, which is basically a basin where the crust has cracked open adjacent to a couple of faults and in the case of Fruta del Norte, hot fluids came up that plumbing system that was provided by the faults, and it was gold-bearing, and the gold just precipitated to form the epithermal deposit. So building on our knowledge of FDN, it’s absolutely fundamentally important for us to be able to find these pull-apart basins.”
Aurania completed an airborne geophysical survey of its 2,080-sq-km project area in November and is analyzing the results. The first target defined from the geophysics program – Awacha – was announced on Dec. 6.
In terms of its capital structure, the company has about 31 million shares fully diluted and Barron owns over half of them. Altogether, insiders own about 62% of the company but that will likely be diluted as funds are raised for exploration.
Aurania Resources had about $700,000 in cash. |
