Aben Resources set the bar very high for itself by delivering a blockbuster first hole to kick off its summer 2018 exploration program at its Forrest Kerr Project in British Columbia’s Golden Triangle. Aben has continued drilling away at Forrest Kerr and according to Aben CEO Jim Pettit they are now on hole #36 of the 2018 exploration program.
Thus far Aben has released assays for nine holes including Tuesday morning’s NR which contained eight step-out holes from the North Boundary Zone including 5.08 g/t Au over 12.0 meters, including 24.25 g/t Au over 2.0 meters. While the latest batch of assays aren’t the sort of eye popping 39 g/t Au over 10 meters grade of the first step-out from the 2018 season, these results are significant because they continue to encounter significant gold mineralization at shallow depth.
The three South Boundary holes that were sent off for rush assays in late-August unfortunately ran into a bottleneck at the assay lab. They were subsequently shipped to another affiliate lab in Kamloops which has less of a bottleneck and the company expects to receive the complete assays for those three holes by the end of next week.
While the market’s lack of patience is understandable and ABN’s stock chart is following a familiar pattern to last year (rally during July/August followed by selling in September), it really is different this time for Aben. Here’s why:
Aben now has more than C$7 million in its treasury which means it won’t need to do a raise until at least well into next year’s exploration season.
Aben is currently in the midst of its largest exploration program at Forrest Kerr to date and the company intends to continue the drill program for as long as possible.
The vastly expanded 2018 drill program means that Aben is likely to have assays coming in well into the fall.
Aben just completed a geophysical survey of the entire Boundary Zone (50 meter spacing running north-south down the entire valley) and expects to have all of that data by the end of September.
Aben has two crews currently doing geochemical work throughout the North Boundary Zone and to the south on the Forrest Zone, filling in gaps in the southern portion of the property.
All of this additional exploration work means that Aben will be a lot smarter and have a much deeper understanding of the geology at Forrest Kerr when it comes time to head back up to the Golden Triangle in 2019.
To sum it up, the recent reset of expectations has left Aben with a ~C$22 million market cap which equates to a C$15 million enterprise value after one subtracts the cash currently sitting in Aben’s treasury. A C$15 million enterprise value for one of the most prospective property packages in the Golden Triangle doesn’t seem like a tall price to pay. Moreover, a steady stream of news flow over the next couple of months should give investors plenty of information to chew on. The addition of billionaire investor Eric Sprott as a significant shareholder is also a welcome addition and Mr. Sprott has already begun adding to his position on the open market:
Investors can now buy shares of ABN on the open market cheaper than Mr. Sprott has purchased his nearly 7 million shares (prices ranging from $.30 to $.39).
From a technical chart perspective ABN shares have traded back to major support near C$.20 while also filling in the open gap that was left from the August 9th gap higher:
ABN.V (Daily – Year to Date)
With the recent reset of investor expectations combined with the prospect of a steady flow of assay results for the next 2-3 months I believe that now is an even better time to get into ABN shares than early August before ABN delivered its blockbuster first hole of the 2018 drilling program. Add in the company’s topped up treasury and the addition of Eric Sprott as a large shareholder and the recent share price decline has delivered a delicious opportunity for those who can think outside the box and not blindly follow the “sell in September Golden Triangle playbook”.
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