Allegiant Gold Ltd. [AUAU-TSXV], the new spin out company comprised of the Western U.S. exploration assets of Columbus Gold Corp. [CGT-TSX, CBGDF-OTCQX] has emerged on the buy list at Beacon Securities Ltd., which has set a 12 month-target of around 90 cents for the stock.
Allegiant shares rose 1.20% or $0.005 to 42 cents on Tuesday. The 52-week range is 75 cents and 41 cents.
Allegiant owns 14 drill-ready projects in the Western U.S., including 11 in Nevada. All were handpicked by Andy Wallace, a successful and highly experienced geologist.
Beacon analyst Michael Curran said the buy rating is based on a number of factors, including Allegiant’s exploration portfolio, that fact that several of its properties are drill-ready, and the positive outlook for Allegiant’s Eastside project.
“We consider Allegiant’s shares to be an attractive investment for exploration success, with a quality exploration team (with experience and gold discoveries) working in a low political risk jurisdiction,” wrote Curran in his report.
“For Allegiant, we believe the 2018 exploration strategy can deliver new discovery and/or expansions of existing resources,” he said. As an initial target, Curran said he is optimistic that the current resource at Eastside can grow to 1.5 million ounces.
Allegiant recently added a second drill rig to the resource expansion program currently under way at the 100%-owned Eastside gold project, located 32 km west of Tonopah, Nevada.
The goal is to double the pit constrained inferred resource, which currently stands at 721,000 gold equivalent ounces at the Original Zone deposit and reduce the strip ratio.
One drill rig continues to test the western extension of the Original Zone, which Allegiant successfully extended 300 metres to the west in recent drilling.
Highlights include drill hole 147, which returned 42.7 metres of 2.49 g/t gold, including 9.1 metres of 9.03 g/t gold.
The drill program continues to test the western extension of the Original Zone, which still remains open.
A second drill rig has been added to test the southern extension of the eastern part of the Original zone, which also remains open.
The planned holes will step out up to 400 metres from the southern edge of the currently defined Original Zone in an area of strong alteration where surface sampling has returned 5.76 g/t gold, the company said Friday. Further, the areas of drilling are currently classified as waste inside the pit outline, or just outside the southern pit layback. In addition to the west and south, the Original Zone also remains open to depth, to the east, and possibly to the north.
Drilling at Eastside, consisting of 20,000 metres in 48 core and rotary drill holes, is in progress and will continue in the third quarter of 2018. Allegiant plans to publish an updated resource estimate for the Original Zone by the end of 2018.
“The Original zone has the hallmarks of a very large gold system and is just one of many exploration targets that exist at Eastside.” Allegiant Chairman Robert Giustra has said.
Eastside also hosts an historical resource of 11.1 million tonnes grading 0.024 oz/ton gold per ton (0.82 g/t), for a total of 272,153 ounces.
Subject to obtaining financing, Allegiant is planning to spend the next 12 months drilling 10 of the 14 projects in its portfolio.