In a July 7 research note, Noble Capital Markets analyst Mark Reichman reported the takeaways from comments by Aurania Resources Ltd. (ARU:TSX.V; AUIAF:OTCQB) management during Noble and Channelchek's recent virtual road show.
Aurania's Chairman and CEO Dr. Keith Barron and President and Director Dr. Richard Spencer talked about the company's achievements and future plans. Reichman reported three key topics of the discussion: exploration, access agreements and joint ventures or spinoffs, all pertaining to The Lost Cities–Cutucu project.
As for drilling, Reichman relayed, Aurania has drilled 28 holes to date over 12,018 meters in several targets. Among them were the Crunchy Hill and Kuri-Yawi epithermal gold-silver targets, the Tsenken N2 and N3 porphyry copper targets and the Tsenken N1 sediment-hosted copper-silver target. Results of holes 3 and 4 from drilling at Tsenken N1 and of hole 9 at Kuri-Yawi are expected soon.
Currently, Aurania is addressing the sediment-hosted targets. Drilling is underway at Tsenken N1 and Tiria-Shimpia.
"We anticipate that management could have a clearer view of the system encompassing Tsenken N1 and Tiria-Shimpia by the end of summer," Reichman wrote.
In the future, Aurania plans to drill additional targets, including: Latorre C gold-silver (about 2.5 kilometers from Yuri-Kawi, KuriPan gold-silver, Tsenken N4 copper-gold and Kuri-Yawi copper-gold.
"KuriPan is interesting because of gold identified in the stream sediment samples and indications of gold veining," wrote Reichman.
Regarding access agreements, the analyst noted, Aurania continues to obtain these and now has signed agreements, representing about 75% of the project area, with 43 of the 55 communities connected to its property in Ecuador. The explorer expects to increase that number during this half of 2021.
Finally, Reichman reported that Aurania management is considering partnering on and/or spinning off certain of its claim packages. One possible scenario is partnering with a major that will take over exploration through completion of a feasibility study, earning up to a certain stake in the project, while Aurania retains the remaining interest. As for spinoffs, there could be more than one, Reichman indicated, given the number of mineralization styles at The Lost Cities–Cutucu.
"The formation of joint ventures and/or spinouts could help maximize the value of the company's holdings for Aurania's shareholders," Reichman wrote.
Noble Capital has an Outperform rating and a $3.75 per share target price on Aurania, the current share price of which is $2.19.
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