Keith Barron, who owns 53% of the outstanding common shares of Aurania Resources (TSXV: ARU), has agreed to loan the company up to C$3 million to support exploration at its 100%-owned Los Cities gold project in Ecuador.
The chairman and CEO also participated in the company's rights offering in March that raised C$5.25 million. Barron acquired 1.48 million of the 1.95 million shares issued at C$2.70 per common share.
The geologist privately co-founded Ecuador gold explorer Aurelian Resources and discovered the Fruta del Norte deposit in 2006. The company was acquired by Kinross Gold (TSX: K; NYSE: KGC) in 2008 for $1.2 billion.
Aurania Resources' Lost Cities-Cutucu project is in the eastern foothills of the Andes mountain range in southeastern Ecuador. So far Aurania has eleven targets for gold-silver mineralization, four copper targets and one silver-zinc-lead target.
So far Aurania has eleven targets for gold-silver mineralization, four copper targets and one silver-zinc-lead targetOn April 9, the company announced it had doubled the size of its Kirus copper-silver target to an area measuring 6 km by 3 km, samples from boulders in streams contain up to 12% copper with 166 grams per tonne silver. Follow-up exploration found mineralization of up to 5.1% copper and 70 grams silver per tonne in sporadic outcrops in dense jungle over a 2 km trend northwest of the Kirus magnetic feature.
Kirus is about 6 km from Aurania's Tsenken target, and both are associated with highly magnetic features evident in a geophysical survey the company flew over the Lost Cities project. Both targets have high-grade coper and silver in sedimentary rocks over, and adjacent to their respective magnetic features.
On April 2, Aurania announced that its team had enlarged the Tsenken target by 6 km and that it has found high-grade copper and silver over a 9 km trend. Grab samples from boulders in streams contain up to 7% copper with 70 grams silver.
In a press release at the time, president Richard Spencer noted that the company's current exploration model is that copper and silver from the porphyry cluster "spread into the enclosing, permeable sedimentary rocks where it was trapped, creating a more or less flat-lying layer of copper-silver-bearing rock."
"This sheet-like target should be relatively simple to drill," he commented. "The potentially larger target presented by the covered porphyry would require much deeper drilling and would be investigated in a later phase of exploration."
(This article first appeared in The Northern Miner)