There is good reason to think there is something familiar about Aurum Resources Ltd’s approach to building a gold mining business in Côte d’Ivoire.
The team behind Aurum – primarily managing director Caigen Wang and executive director Mark Strizek – has form in the West African country with Tietto Minerals.
Tietto discovered and developed the 3.8 million-ounce Abujar Gold Project in western Côte d’Ivoire before it was taken over by Hong Kong-listed Zhaojin Mining for US$475 million in 2024.
Speaking to Proactive Investors, Wang has no qualms in admitting that Aurum is seeking to replicate the success of Tietto.
“That’s very much the case,” he says. “What we’re doing [with Aurum] is repeating what we did with Tietto.”
The new quest is off to a promising start.
Aurum took over rights to two tenements that form part of the Boundiali Gold Project in northern Côte d’Ivoire in August and November 2023.
Just 13 months later, on New Year’s Eve last year – with the Boundiali landholding expanded through the addition of two adjacent tenements – the company declared a maiden resource for the project of 1.6 million ounces.
Furthermore, the acquisition of ASX-listed Mako Gold, completed in early February this year, has given Aurum a second project 100 kilometres away.
The flagship Mako asset, Napie, sits on the same greenstone belt as Abujar and hosts a mineral resource of 868,000 ounces spread over two deposits as well as several exciting exploration prospects.
Aurum’s vision is to develop the two projects into standalone multi-million-ounce mining operations – Boundiali first, followed shortly thereafter by Napie.
Best address in West Africa
Wang had no connections in Côte d’Ivoire when he first visited with Tietto in mid-2012.
But he quickly saw the potential in a country where civil conflict and instability had acted as a deterrent to foreign investment for over a decade prior to 2012.
The government was welcoming and there were plenty of opportunities to put a foot on good exploration ground.
More than a decade later, Wang still views Côte d’Ivoire as “the best gold investment destination in West Africa”.
“Technically, there’s no doubt,” he says. “The entire country is sitting on the Birimian greenstone belt [host to major gold deposits].”
“Importantly, it’s also underexplored.”
While the chances of discovering multi-million-ounce gold deposits are arguably greater in Côte d’Ivoire than Western Australia these days, exploration is also cheaper.
Those cost savings are amplified when you are doing the drilling yourself.
Aurum has revived the model used to great effect by Tietto of operating its own diamond drill rigs.
Within 10 months of taking on Boundiali, Aurum had a fleet of eight diamond rigs manned by a crew of 27 operators and offsiders, ensuring drilling can be carried out around the clock.
The company estimates the self-owned approach reduces drilling costs by up to 65 per cent.
“It provides a great deal of flexibility, not only from an economic perspective but you are also able to manage your schedule,” Wang says.
“You don’t have to wait for rig availability, which is almost always the case when you use a commercial drilling service.”
In-house drilling supercharges schedule
The efficiencies of this model were apparent in the speed with which the Boundiali maiden resource was announced.
They are also reflected in the frequency with which Aurum expects to deliver resource upgrades.
The company is budgeting 100,000 metres of diamond drilling a year at Boundiali for 2025 and 2026 and has scheduled a resource upgrade every six months through that period.
Aurum anticipates that the first resource upgrade will be delivered in mid-2025 and following the timetable, a second resource upgrade at the end of 2025. This would coincide with the delivery of a pre-feasibility study (PFS) for the Boundiali project.
Boundiali Project location and distribution of historical soil assays within the two licences. Datum WGS84 UTM30N.
Work has already commenced on the PFS with the delivery of positive metallurgical results late last year in 2024. This work demonstrated that the ore is free milling with up to 95% gold recovery and potential for a simple single-stage crush SAG, gravity and CIL.
Work on this and other work streams has commenced and shareholders can look forward to updates throughout the year.
The third resource update in the middle of 2026 would become the basis for a definitive feasibility study.
Provided everything stacks up and financing is straightforward, construction would start at the beginning of 2027.
The first two years of mining at Boundiali will be free digging as an oxide layer starts at the surface and continues to a depth of 60-80m.
In January Aurum signed a non-binding Memorandum of Understanding with mining equipment manufacturer Sany Heavy Equipment Co to cooperate on equipment procurement and financing.
“All we need is a digger and a number of trucks for the early years of mining operations,” Wang says.
“If flexible financing is available, that opens up the door for us to look at owner-operating.
“From our experience of operating the drilling ourselves compared to using a commercial contractor, the flexibility is there and the economic benefit is there as well.”
Mako makes sense
While Tietto was taken over as a single project company, the acquisition of Mako and its Napie gold project adds a different element to Aurum.
The consideration paid was one Aurum share for every 25.1 Mako shares, with Mako shareholders owning 20.5 per cent of the merged entity when the transaction was finalised.
Wang says the rationale for taking over Mako was primarily that the Aurum team could see the potential to do the same as they are doing at Boundiali at Napie: consolidate surrounding tenements and prove up a multi-million-ounce gold field.
MREs on Tchaga and Gogbala cover 4.4km of prospective 30km-long Napié Shear Zone.
Aurum is waiting for the paperwork to resume drilling at Napie. It has 30,000 metres planned for the project in 2025.
While research shows that developing mining projects in West Africa is typically faster and can be done at a lower capital intensity than in other jurisdictions, Aurum’s efforts in Côte d’Ivoire should also be aided by management’s track record with Tietto.
“We’ve really been recognised as true investors, real explorers and project developers in Côte d’Ivoire,” Wang says.
“The Ministry of Mines and other government departments understand that we are there to make a contribution to the economy.
“In Côte D’Ivoire, the Ministry [of Mines, Energy and Petroleum] is very supportive and making every effort to make sure that mining projects are not going to be held up on their side, on the permitting.
“We will push as hard as we can and have close communication with the ministries so they really know where we are.”
The Proactive take
“A solid resource base to build from in a jurisdiction with a proven record of hosting multi-million-ounce deposits. Aurum could have two substantial gold operations firmed up in a short period of time. If that does come to pass, the valuation that the company commands would be a lot higher than where it currently stands. Management’s previous success in Cote d’Ivoire bodes well for fast-tracking projects into production.”
Aurum Resources investor snapshot
- ASX CODE: AUE
- MARKET CAPITALISATION: $64 million (at 30c share price)
- SHARES ON ISSUE: 220.4 million
- CASH (at 31 December 2024): $23.8 million
- ENTERPRISE VALUE: $40.2 million
- KEY ASSETS: Boundiali Gold Project (resource 1.6 million ounces at 1.0 g/t Au), Napie Gold Project (resource 870,000 ounces at 1.2 g/t Au)