Resource World Magazine

44 www.resourceworld.com A P R I L / M A Y 2 0 1 4 It's a crazy world out there for gold juniors. Eighteen months ago investors wanted as much gold as they could find. Companies with million-ounce resources command- ed market capitalizations in the multi-millions or even billions of dollars. Today, the sentiment has turned 180 degrees. In-ground gold resources controlled by many juniors are selling for next to nothing. It's an environment where incoming investors can buy ounces for pennies – a feat that would have been unthinkable during most of the last decade. A case in point is Augustine Ventures Inc. [WAW-CNSX]; a junior gold developer that's selling incredibly cheap – but not holding back from creating value ahead of a market comeback. Augustine controls exactly the sort of asset that was a major attractant for investors during the good old days for gold. The junior is moving forward the in Wawa gold camp in Ontario – a project that comes with a substantial, million-ounce gold re- source. Not only that, but Wawa is host to very good grade, as compared to the universe of projects being advanced globally. The aforementioned million ounces runs nearly 1.5 g/t gold, using a cut-off of 0.5 g/t. Even better, there are rich zones to this mineralization. Shift- ing to a higher cut-off grade of 2.0 g/t gold, the Wawa resource could hold just under 500,000 ounces grading over 3.3 g/t. It's a good sign geologically when you can quadruple your cut-off grade and still have half the resource intact. The other notable thing about Wawa is the project's apparent ease of development. The camp lies in one of Ontario's historic mining districts, with the nearby town of Wawa having for- merly supported iron ore operations here. The district lies 150 km southeast of the storied Hemlo mining region. That means many of the pieces needed for mining at Wawa are already in place. Access is good, with the project lying im- mediately off a major paved highway. Both an airstrip and a railway junction are located within 20 km of the site. There's even a power line along the west side of the Wawa property, with a right of way leading to historic mining sites on Augus- tine's licenses. Given these pluses, it would be reasonable to assume that Augustine's sizeable resource would command a premium. But the reality is in fact quite the opposite. Today, the company sells at a mere $1.25 million market capitalization. At this fig- ure, Wawa's in-ground gold resource is selling for $1.94 per ounce – based on Augustine's pending 60% ownership in the project. Compare that to recent M&A transactions pegging gold re- sources at over $20 per ounce, and the value proposition starts to get interesting. Of course, it's all well and good to point out how undervalued you are as a junior company. But what's a developer to do while waiting for the market to recognize the upside in a potential sleeping giant like Wawa? The answer it appears is to keep moving forward. That's the approach Augus- tine is taking. The company isn't leaving it up to skittish inves- tors to get around to re-valuing its shares. Rather, management is mapping out a slalom of milestones aimed at making observ- ers see the potential here. One of the big aims of Augustine's upcoming work program is to grow the resource. The Wawa mineralized deposit remains open in several directions, and up to 14,000 metres of drilling have been laid out as a next exploration phase by the company in order to add ounces. That, of course, only covers the near-mine potential. Wawa is surrounded by an additional 8 km of potentially mineralized geologic strike, some of which is underlain by prospective- looking electromagnetic anomalies that could signal additional mineralization lurking below. At the same time as it grows the Wawa deposit, Augustine will also be studying how to mine the project. A full update is planned for the existing 3D model of the mineralized body. The company will also begin mine planning, and an internal economic assessment of the project. This should help ensure that as investors return to the gold sector, they're going to see a new-and-improved version of an already attractive project in Wawa. In fact, foresighted stock buyers already appear to be getting on board with the story. Augustine is currently in the midst of a $2.8 million financing, which would give Wawa a big vote of confidence – and the funds needed to bring the project closer to fruition. Not a bad accomplishment amid the current mar- kets. n Augustine Ventures exploring for additional gold resources By David Forest "One of the big aims of Augustine's upcoming work program is to grow the resource." MINING

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