Aurum Resources (AUE.AX) reported a rather substantial resource increase on its flagship Boundiali gold project in Cote d’Ivoire. Boundiali currently contains just under 41 million tonnes of rock at an average grade of 1 g/t gold in the indicated resource category (for 1.37 million ounces of gold) while there is an additional 59 million tonnes of rock in the inferred resource category at a slightly lower grade of 0.9 g/t gold. This means the inferred resource category hosts an additional 1.66 million ounces of gold, bringing the total Boundiali resource to 3.03 million ounces of gold at an average grade of 1 g/t (rounded).
The resource also contains a higher grade component of 1.7 g/t gold which would yield 1.61 million ounces of gold (using a cutoff grade of 1 g/t gold), but no strip ratios have been mentioned for either the base case cutoff scenario nor the 1 g/t cutoff grade.
The mineralization at Boundiali remains open along strike and at depth across all deposits. As drilling is ongoing (one of Aurum’s main positive characteristics is the fact that it owns its own drill rigs, so its is basically drilling ‘at cost’) we should see additional resource calculations in the next quarter. Aurum is guiding for an update resource at Boundiali ‘early in Q3’, which means a further increase appears to be just around the corner.
On top of that, the company also plans to release an updated resource on its Napié project before the end of this month and it will be interesting to see how the 0.87Moz resource at Napié has evolved since the previous resource.
Upon the completion of the current 100,000 meter Boundiali drill program, we anticipate Aurum’s consolidated gold resource to exceed 5 million ounces, with the vast majority hosted at Boundiali where 3.5-4 million ounces across the measured and indicated and inferred resource category appears to be realistic. We then expect Aurum to move forward to the economic studies to get a better understanding of the potential economics at Boundiali. Depending on the outcome of an economic study and the further exploration success, Boundiali and Aurum could become the next buyout target in Africa (with Chinese buyers likely in a pole position). Aurum currently has in excess of A$40M in cash, and remains fully funded for its 100,000 meter drill program at Boundiali.
Disclosure: The author has a long position in Aurum Resources. This post is for educational purposes only; be mindful investing in junior mining stocks is risky and you may lose your entire investment if things go wrong. Please read the disclaimer.
