Newmont-backed Awalé drills new gold zone at Odienné

Drilling at Awalé Resources’ (TSXV: ARIC; US-OTC: AWLRF) Odienné copper-gold project in northwest Côte d’Ivoire has uncovered a new zone in near-surface gold mineralization at its Fremen target.

Highlight hole SSAC-08 cut 17 metres grading 1.9 grams gold per tonne from 6 metres depth, including 9 metres at 2.3 grams gold, Awalé reported on Monday, while hole SSAC-07 returned 12 metres grading 2.1 grams gold from 32 metres downhole. Under Awalé’s agreement with Newmont (TSX: NGT; NYSE: NEM), the major funds all exploration at several joint venture targets, including Charger, BBM and Empire. Fremen is outside the JV scope. Odienné is about 400 km northwest of the capital Yamoussoukro.

“We see potential for the first of a series of satellites at Fremen, which importantly offers proof of concept that the host conditions we see on the Odienne JV grounds are also present on Awale’s 100% owned tenements,” SCP Resource Finance analyst Justin Chan said in a note on Monday. 

The drill results have confirmed significant shallow gold mineralization at the Fremen target, Awalé CEO Andrew Chubb said in a release.

“These broad intercepts (…) support our view that Fremen is an emerging gold discovery with clear potential for expansion along strike and at depth.”

Birimian’s emerging region

The new discovery at Fremen highlights the prospectivity of Odienné, which sits on a relatively under-explored portion of the Birimian greenstone belt that stretches across West Africa. Newmont holds an 8.9% interest in the company and an earn-in agreement on part of Odienné, and Fortuna Mining (TSX: FVI; NYSE: FSM) has a 15% stake in the junior. 

Awalé shares gained 3% to C82¢ apiece on Monday morning in Toronto, for a market capitalization of $92.5 million. The stock has traded in a 12-month range of 43¢ to $1.18.

Other drill highlights include SSDD-03 that returned 17 metres at 1.1 grams gold from 113 metres depth and SSDD-02 which cut 13 metres grading 1 gram gold from 78 metres downhole, including 4 metres at 1.8 grams gold.

1-km zone

The assays confirmed gold mineralization over a 1-km zone inside a broader 8-km mineralized corridor, Awalé said.

The drilling is part of a stage-three program of 5,210 metres across 126 holes at Fremen, located on the eastern edge of Odienné and on the Sienso permit.

The results at Fremen precede an initial resource for Odienné, expected in the second quarter, and a preliminary economic assessment in the third quarter. A pre-feasibility study is anticipated in late 2027.

The initial estimate might deliver a 1.5 to 2 million-oz. gold-equivalent resource supporting a 150,000-oz.-per-year operation with a net present value of US$1.1 billion at $3,600 per oz., Chan said. 

“At 150-200,000 [per year], we think Odienné has critical mass for an attractive mid-tier asset, but below Newmont’s typical asset threshold, which we think sets up two value unlock paths for ARIC shareholders,” he said. One path would see Awalé buy Newmont’s stake such as happened at Greatland Gold’s (LSE: GGP) Telfer operation in Australia, or an M&A where a mid-tier acquires both Newmont’s interest and Awalé’s, Chan said.