Awale Resources Limited

Overview

Awalé Resources (TSX:ARIC) is a mineral exploration company focused on high-quality gold and copper-gold deposits. The company’s Odienné project is located in Cote d’lvoire (Ivory Coast) in West Africa, close to the borders of Guinea and Mali.

Cote d’lvoire has earned a reputation as an attractive investment destination for mining based on several factors. First, its stable regulatory framework mirrors the French civil law, and the government has reduced bureaucracy and established transparency. Second, the region has excellent infrastructure comprising road networks, ports, airports and electricity networks. Third, the country’s attractive geological profile is rich in several minerals including gold, copper, manganese, bauxite and iron. West Africa is widely regarded as a promising gold-producing region with 300 Moz of gold resources. Fourth, its socio-economic environment reflects its diverse economy with a substantial labor force. Lastly, the country offers several tax incentives to attract foreign investors.

The Odienné Project offers Awalé Resources a major foothold in this promising gold province. The project area spans 2,462 sq. km. over seven permits and is home to several gold and copper-gold discoveries.

The project has seen four significant discoveries, including three in 2023 (Empire, Charger and Sceptre East) and one in early 2024 (BBM). Empire returned high-grade gold intercepts, while Charger and Sceptre East Target returned iron oxide copper gold (IOCG) style mineralization. The BBM target, discovered in January 2024, is a new gold-copper discovery with significant scope for rapid expansion. In addition to the new discovery, further significant results with visible gold have been returned from the first two scout holes at the Lando Target, which lies 10 kilometers northwest of the new BBM discovery.

Another important feature of the company’s bright prospects is its relationship with Newmont, the world’s leading gold company. Newmont increased its stake in Awalé to 15.48 percent in December 2023, from 5.94 percent, following a private placement of nearly C$1 million. This investment will enable Awalé to accelerate the exploration of its wholly owned permits and also signals a vote of confidence in the significant potential of Awalé.

Newmont holds a joint venture agreement on two of the seven permits at the Odienné project and is funding 100 percent of the exploration on the JV permits. Newmont has the option to earn up to a 75 percent interest in the Odienné Project by funding US$15 million in exploration expenditures.

Under the initial phase, Newmont will invest US$5 million in exploration expenditure which will allow it to earn 51 percent interest in the Odienné Project. Under the second phase, the mining giant will make an additional US$10 million in exploration expenditures targeting to define 2 Moz gold resources, and allowing it to earn an additional 14 percent stake in the project. Finally, Newmont has the option to purchase a minority 10 percent interest in the Odienné Project which, if exercised, would increase Newmont's interest to 75 percent. The relationship with Newmont is a key positive for the prospects of the company.

Awalé underwent a major overhaul in May 2023, appointing a new CEO and board. Under the new management, led by CEO Andrew Chubb, the Awalé team is well positioned to lead the company in its future growth endeavors.

Company Highlights

• Awalé Resources is a mineral exploration company focused on discovering gold and copper-gold deposits in Côte d’Ivoire (Ivory Coast).
• The company’s flagship Odienné project is located in the northwest Denguèlé Region of Côte d’Ivoire in West Africa.
• The project spans over 2,462 sq. km in area with seven permits and is located in a region that boasts over 300 million ounces (Moz) of gold deposits. The geological setting of the Odienné district is comparable to that of other significant iron oxide copper gold (IOCG) provinces globally, increasing the chances of the Odienné Project becoming the first major IOCG deposit in West Africa.
• The project has made three significant discoveries in 2023 – Empire, Charger and Sceptre East. Moreover, in January 2024, the company announced a new discovery in BBM and encouraging results for the Lando target.
• A key positive for the company is its relationship with Newmont, the world’s leading gold mining company. Newmont increased its stake to around 15.48 percent (previously 5.94 percent) in the company and holds a joint venture agreement on two of the seven permits at Odienné Project.
• Awalé underwent a major overhaul in May 2023, including the appointment of a new CEO and new board. Under the new management led by CEO Andrew Chubb, the company has achieved significant milestones including four new discoveries. The management team is well positioned to steer the company along its growth journey.

Key Project

Odienné Project

The Odienné Project is the company’s flagship asset. The project spans over 2,462 sq. km. and comprises seven permits, of which two are under a JV agreement with Newmont. These permits hold great promise for gold and copper-gold deposits.

The Odienné Project has similar geological characteristics to the Carajas Mineral Province and other IOCG provinces that are major suppliers of gold and copper.

The project is located in West Africa and boasts over 300 Moz of gold deposits. There are several 10+ Moz deposits adjacent to the project’s boundaries. Some of the other adjacent deposits are Predictive’s deposit in Guinea, and Centamin’s deposit which is roughly 50 kilometers south of the Odienné project.

The project is characterized by several high-potential targets and discoveries. These include: 1) Empire discovery located along the 20-kilometer Empire Gold Corridor; 2) Sceptre East and Main copper-gold targets; 3) Charger, a high-grade gold-copper discovery; 4) Lando, a 4-kilometer-long copper-gold target; 5) and BBM, a 3.5-kilometer-long copper-gold target.

The first discovery was at Empire, a high-potential gold prospect located around 5 kilometers from Sceptre and other copper-gold targets on the 20-kilometer-long Empire structural corridor. So far, only five kilometers of this trend have been drilled. The key results for this target include - 1) Hole OEDD-2: 27 meters at 3.1 grams per ton (g/t) gold from 43.2 meters, and 2) Hole OEDD-24: 15 meters at 13.1 g/t gold from 69 meters. Beyond this main target, there is potential for discovering large gold deposits along the east-west corridor.

The second discovery was at Charger, where several phases of drilling have been completed. A total of 11 holes were drilled at Charger with Hole OEDD-45 containing three high-grade intervals within a 65-meter wide zone of mineralization, including 12 meters at 4.9 g/t gold. Some of the key results at Charger include 32 meters @ 3.0 g/t gold, 0.17 percent copper, and 6.6 g/t silver, including 4 meters @ 12.4 g/t gold, 0.7 percent copper, and 30 g/t silver from 78 meters.

The third discovery was at the Sceptre East target that spans around a 1.5-kilometer-long copper-gold-molybdenum-silver anomaly. Sceptre East is part of the large 20 sq. km gold/copper/silver/molybdenum bearing mineralized system, which is called Sceptre. Discovery drilling commenced at Sceptre East in Q4 2022, and the initial phase comprised a total of seven holes totaling 1,092.2 meters. Follow-up drilling in Q2 2023 consisted of nine reverse circulation (RC) and three diamond drill holes for a total of 1,730 meters. The key results in the follow-up program include hole OEDD-43, which returned 358.5 meters at 0.34 percent copper equivalent from 6.5 meters downhole.

Besides these three discoveries, the company announced a new gold-copper discovery in January 2024 at the BBM target. A total of four holes were drilled at BBM, all of which intersected high-grade gold. The key results were:

• Hole OEDD-59: 44 meters at 1.1 g/t gold and 0.2 percent copper
• Hole OEDD-61: 51.9 meters @ 0.5 g/t gold, 0.27 percent copper and 1.5 g/t silver from 25 meters
• Hole OEDD-62: 18.25 meters at 1.8 g/t gold, 0.3 percent copper and 1.4 g/t silver from 156 meters

Furthermore, significant results with visible gold have been returned from the first two scout holes at the Lando Target, which lies 10 kilometers northwest of the new BBM discovery. Initial drilling at Lando is encouraging and warrants further systematic drilling at this target.

Management Team

Andrew Chubb – CEO

Andre Chubb holds a BSc degree from the University of New England, Australia, and is a member of the Australian Institute of Geologists and the Society of Economic Geologists. He is a geologist with more than two decades of experience in exploration and mining in different geographies, including Africa, Europe and Australia. His experience spans different domains including leading large teams, operations and advisory roles. He was involved in leading the Mantra Resources’ Mkuju Project in Tanzania, from exploration through to feasibility and finally to takeover by ARMZ/Uranium One for AU$1.02 billion.

Stephen Stewart - Director

Stephen Stewart holds a BA degree from Western University in London, Ontario, an MBA from the University of Toronto, and an MSc degree from the University of Florida. He has more than 18 years of senior leadership experience with several Canadian companies, including Orecap, QC Copper & Gold, Mistango River Resources and Baselode Energy. He is also the founder and chairman of the largest mining-focused charitable organization and fund in Canada, the Young Mining Professionals Scholarship Fund.

Derk Hartman – Director

Derk Hartman holds an MSc degree from Delft University of Technology in the Netherlands and the FT non-executive director diploma from the UK. He has more than 17 years of experience in the mining and banking sectors. He has been associated with BMO Capital Markets in an investment banking role for over 12 years and has rich experience in various domains. Most recently, he served as the CFO of Silver Bear Resources, listed on TSX.

Robin Birchall – Chairman

Robin Birchall holds an MBA degree from the University of Cape Town, an MSc degree from Edinburgh University, a BA degree from Queens University, and a Première Degré en Langues Literature et Civilisation, from Stendahl University. He has two decades of experience in the management and financing of resource companies. Previously, he has been associated with Giyani Metals, Silver Bear Resources, Helium One Global, BMO Capital Markets, and Canaccord Adams.

Charles Beaudry – Director

Charles Beaudry holds a BSc degree in geology from the University of Ottawa and a master's degree in geology from McGill University. He has three decades of experience in business development, exploration, and project management. Previously, he has been associated with IAMGOLD and Noranda-Falconbridge-Xstrata.

Andrew Smith – Chief Geologist

Andrew Smith holds a BSc degree from the University of Aberdeen in Scotland and is a member of the Society of Economic Geologists and the London Geological Society. He has more than 11 years of experience in exploration and mining companies. He has previously worked with Randgold Resources in Senegal and leads the Awalé team in Cote d’Ivoire.

Sharon Cooper – CFO

Sharon Cooper is qualified as a chartered accountant, with over 10 years of experience in accounting and auditing roles for mining and mining-related companies. Before Awalé, she was associated with Ernst and Young and several junior exploration and mining companies.

Karl Akueson – Local Advisor

Karl Akueson holds an MSc degree in chemical engineering from the University of Manchester and MSc in metals and energy finance from the Royal School of Mines. He is a co-founder of the company and has served as an advisor since listing. He has also worked with BMO Capital Markets in London.

This article was written in collaboration with Couloir Capital.