Shares of Advance Gold Corp. (TSXV:AAX) have surged 125% during the past three weeks
SmallCapPower | January 13, 2020: Advance Gold Corp. (TSXV:AAX) shares have caught our attention recently. Its stock has advanced sharply, 125% since December 23, 2019, to its current price of $0.18 after the junior exploration company announced that a drill hole on its Tabasquena project in Zacatecas, Mexico encountered a 78 metres sulphide zone containing disseminated to massive sulphides and quartz veining throughout the zone, this after the Company’s 3D Induced Polarization (IP) geophysical surveys identified a 1000 metres by 500 metres continuous chargeability anomaly.
Advance Gold asserts that this is associated with the near-surface veins sitting right below the Tabasquena vein, believing there is “ample evidence that this is a big, long-lived mineralizing system.” Samples from these zones have been submitted for assaying.
Then, on January 6, 2020, the Company announced the drilling of a second hole into this anomaly, 300 metres due north of the first hole, to test the northern portion of the large IP anomaly. This should create plenty of news flow during the first quarter of this year leading up the annual PDAC convention in early March.
Advance Gold acquired a 100% interest in the Tabasquena Silver Mine in Zacatecas, Mexico, back in 2017. Tabasquena had historical silver production at the end of 20th century by Penoles, but only in the oxide zone. Thus, the Project is fully permitted for mining operations including explosives and tailings permits. The state of Zacatecas has produced more than 8% of the world’s silver (Source: Wikipedia).
The Company also owns a 100% interest in the nearby Venaditas project. Investors should take note as Venaditas is located adjacent to the San Nicolas project owned by Teck Resources Limited (TSX:TECK.B).
In 2017, Teck paid US$50 million for Goldcorp Inc.’s 21% interest in San Nicolas (although reports suggest that Teck Resources may sell San Nicolas this year to expand its operations in Chile). A Feasibility Study done by Teck estimates production of 230,000 tonnes of copper concentrates annually with an average grade of 23.8% copper over the 12-year mine life, as well as 190,000 tonnes of zinc concentrates averaging 50% zinc per year over 10 years (Source: Northern Miner).
Getting back to Advance Gold Corp., its President and CEO, Allan Barry Laboucan, is a former resource investment newsletter writer, so promotion shouldn’t be an issue for this Company. More importantly, Advance Gold investors should benefit greatly, at least in the short term, by the Company’s tight capital structure – AAX has just about 33 million shares outstanding, about 24% of which (fully-diluted) are owned by insiders. Expect that share count to rise, as current interest in the stock should tempt management to do another equity raise to fund further exploration.
For now, though, Advance Gold Corp shareholders should be focused on those first sample results, expected to be released in the coming days.
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