Aur’s Hewfran bet looks promising

On the verge of becoming a gold mining company, Aur Resources of Toronto could become a larger concern much sooner than previously thought possible, the company says.

That was the latest news from Aur’s annual meeting in Toronto.

With initial production from the company’s First Canadian, and Norlartic properties in Val d’Or, Que., Aur expects to reach about 40,000 oz by the end of 1989. But recent developments at the Hewfran prospect in Desmaraisville, Que., promises a much larger output.

Located beside the Bachelor Lake Gold property where dilution problems are being overcome, it represents the great unknown in his company’s portfolio of exploration prospects.

After drilling some surface holes in 1986 to explore for an extension of the Bachelor Lake zone, the Toronto-based company recently permitted Aur to complete some underground drilling from an area on the 6th and 8th levels at the border separating Aur and Bachelor Lake ground.

As indicated by Gill, the results have been quite spectacular. He says the Aur exploration program has shown that the gold deposit currently being mined by Bachelor Lake Gold Mines extends for at least 402.5 ft onto Hewfran ground. Average grade

Muck and chip samples taken on the 8th level over the fully diluted 8-ft drift width yielded an average grade of 0.17 oz gold per ton for the entire 402.5 ft strike length of the drift.

On level 6, 300 ft above the 8th level, the best continuous section of the drift yielded chip channel assays averaging 0.18 oz over a 6.4 ft width for a strike length of 270 ft.

“This gold deposit now has a potential strike length of over 2,500 ft of which 1,400 ft has been confirmed in two zones by surface drilling and underground exploration,” says Gill.

As part of a plan to evaluate the deposit, Aur will extend the 6th level drift an additional 1,200 ft, from its present position 600 ft into Aur ground.

Meanwhile, with $25 million in working capital and no debt, Aur Resources is well placed to undertake a 1988 program which includes production feasibility studies at both the First Canadian and Norlartic properties.

At First Canadian, where drill- indicated reserves on the Kierens Zone stand at 700,000 tons averaging 0.20 oz, Aur has deepened the shaft to 1,400 ft. In a bid to connect the First Canadian and Norlartic properties, the company is currently drifting on 1,300-ft level. Behind Schedule

Due to hard rock problems in the early portion of the drift, we are three months behind schedule,” said Gill who expects to complete the First Canadian feasibility study by the end of this month.

With a 1,400 ft shaft already in place at the Norlartic property, Aur and partner Nova-Cogesco Resources are attempting to outline additional reserves below a depth of 1,000 ft on the Main zone. A 10,000-ft surface diamond drilling program is also testing the Marban gold horizon in the southern portion of the property.

A production feasibility study is expected to be completed by June.

Further west of the Kierens zone, affiliate International Thunderwood Exploration has just released results of a 52,500-ft drill program on its Gold Hawk property.

They include Hole 1950-45, which collared 1 ft of 2.59 oz gold, 3 ft of 0.31 oz in Hole 1950-47 and 3 ft of 0.20 in Hole 1950-62.

Results show that a narrow high grade gold zone extends up to the Aur Resources boundary and onto Aur property. “This exciting new gold bearing horizon, with a 4,000-ft strike target, has excellent potential for production,” Gill says.

A limited number of holes drilled on Aur side of the boundary, have traced the horizon for 800 ft. Louvem property

To avoid diluting the company by issuing flow-through shares, Gill says he took the opportunity to enter a number of joint venture agreements to develop Aur’s key exploration properties.

They include a joint venture with La Societe Miniere Louvem on the formerly producing Louvem property east of Val d’Or where Aur is spending $500,000 by early 1989 to earn a 50% interest.

While it produced approximately 2.1 million tons of copper/zinc ore, some 600,000 tons grading 5.5% zinc, 1.0 oz silver and 0.02 oz gold still remains on the Louvem property.

“The potential for finding additional reserves on this property are very high,” said Gill.

Aur reported $391,128 or 26 cents per share for the three months ended Dec 31, compared with $365,286 or 37 cents during the same period last year. A cash position of $24.6 million on Dec 31 was up substantially from $850,734 at the same time in 1986.

The Aur Resources issue was trading recently on the Toronto Stock Exchange at $5.50 in a 52-week range of $4.40 and $15.