Vancouver – The Cardero Group’s Abzu Gold (ABS-V) has started the first round of drilling at its Golden Reef gold project in Ghana’s Asankrangwa gold belt. It plans to complete 12,000 metres of drilling using a combination of reverse-circulation (RC) and diamond core drill holes that will test for gold in quartz-carbonate veins, possibly located beneath the many gold-in-soil anomalies found on the project by Abzu over the past three years.
The company is targeting vein systems similar to those already found in several major gold deposits located along the emerging Asankrangwa belt, a 5- to 10-km-wide swath of northeast striking, steeply northwest dipping shear zones situated between the famous Ashanti and Sefwi belts, about 200 km northwest of Accra, Ghana’s capital. Comprising the closely spaced Golden Reef, Mpatasie and U&N concessions, Abzu’s Golden Reef project sits roughly 8 km to the southwest (and along strike) of Keegan Resources‘ (KGN-T, KGN-N) Esaase gold deposit, which is home to a newly defined 3.23-million-oz. indicated gold resource contained in 85 million tonnes grading 1.2 grams gold per tonne.
Abzu’s newly appointed president, economic geologist Paul Klipfel, knows the area well: he is a former consulting geologist to Keegan, where he helped further delineate the Esasse deposit for a few years. Klipfel also runs his own consulting practice based in Reno, Nev., though he has worked for several Cardero Group companies in recent years, most notably helping International Tower Hill Mines (ith-t) explore its more-than-10-million-oz. Livengood gold deposit in Alaska. In addition, he has previously held positions with, or consulted for, many of the biggest gold mining companies.
According to Abzu’s manager of corporate communications, Quentin Mai, Klipfel decided to take on the role of president after spending a week touring the Golden Reef property last year. He even wrote the technical report on the project, in which he describes the Asankrangwa belt as “an emerging belt of mineralization which is rapidly gaining recognition as more gold is found.”
Abzu’s Ghanaian properties were found by its chief executive officer, Allan Serwa, a former resident of British Columbia who moved to Ghana in 2007 to explore the country which he sees as “the land of opportunity for a multitude of businesses.”
As Mai tells it, when the price of gold started to really take off, Serwa put together a portfolio of optioned gold properties using some local connections and then went shopping around Vancouver for a strategic investor. Through a mutual contact, he pitched the idea to the Cardero Group’s Hendrik “Henk” van Alphen, who immediately liked what he saw.
A Dutch immigrant who moved to B.C. in his early 20s, Van Alphen started out as a self-described “bush rat,” cutting lines and staking claims, before starting his own exploration company and expanding from there. His Cardero Group now tends to a stable of 10 resource companies, including gold explorer International Tower Hill, Cardero Resource (cdu-t), Trevali Mining (tv-t) and others.
Cardero Resource bought an approximate 50% stake in Serwa’s Abzu, and is now its largest shareholder controlling a total of 8.63 million shares plus warrants to acquire another 3.7 million, for which it paid roughly 15¢ a unit.
Abzu’s board of directors now comprises a garden variety of seasoned mining executives connected to the Cardero Group, including: chairman Gordon Neal, a former co-owner of a successful IR firm which claims to have helped raise over $4 billion in debt and equity financings over the years; doctorate of geology holder Mark Cruise, a former Anglo American (aal-l, aauky-q) man now serving as president of Trevali, where he is focusing on putting not one but two mines into production over the next 12 months; and Jeff Pontius, a former AngloGold Ashanti (au-n) geologist who left to co-found the thriving International Tower Hill Mines.
As for management outside of the Cardero Group, Abzu has decided to bring on board CEO Serwa’s brother Mark as “manager of social development,” whose goal is to implement a three-phase social program to reach out to the local communities. He is currently on stage one, which employs 25 local Ghanaian and involves dialogue with the Paramount Chief of the Manso Nkwanta tribe, who owns a small interest in one of Abzu’s main properties.
Past exploration of the Golden Reef project by three different operators during the 1990s identified multiple gold-bearing zones on the property. Trenching and limited drilling (31 shallow RC drill holes and 4 diamond core holes) returned some tempting results but not enough for the previous owners to stick around longer than a year or two. The best historical intercepts include 65 metres of 1.1 grams gold per tonne, 4 metres grading 24 grams gold and 13 metres grading 2.25 grams gold.
Abzu is starting its drill program with 25 first-pass drill holes in southeast-northwest fence lines at an average depth of about 150 metres. It will target the soil anomalies that Abzu says coincides with a series of northeast-trending structures. According to president Klipfel, “Elsewhere in Ghana, similar northeast-trending structures host multimillion-oz. gold deposits, which are the target of our exploration program.”
Following its June 21 announcement that drilling had commenced, shares of Abzu closed up 14¢ to 65¢ on light volume of 43,000 shares. The company has a 52-week trading range of 45¢ and $1.20, and has 53 million shares outstanding (83 million once fully diluted).