AUSQUEST (ASX: AQD) is another stock to watch in the days ahead. Excitement is building over the soon-to-be released assay results from drilling of the underlying sulphide targets at its Comoe gold exploration joint venture with Canada's Endeavour Mining in Burkina Faso.
Shallow drill holes have previously yielded the sort of near-surface gold intersections we have come to expect from West African gold exploration, with higher-grade intersections occurring within zones of increased sulphide content.
That prompted the decision to drill a bunch of deeper holes to test the underlying sulphide mineralisation at the Phaco North and Phaco South prospects, and a second gold trend some 200 metres east of the main North-South trend on the Comoe joint-venture ground.
AusQuest has previously flagged that the deeper drilling intersected with either ''significant'' or ''large'' thicknesses of sulphide mineralisation, and that assay results would begin to be released this month.
The hope is that the company is on to a gold-rich volcanogenic massive sulphide system, which commonly occur in clusters elsewhere in the world and which generally contain iron, copper, zinc and lead.
It won't take much to get AusQuest's share price moving.
It closed on Friday at the princely price of 14.5? a share. Thanks to its iron ore focus in years gone by, and the backing of US iron ore producer and 30 per cent shareholder Cliffs, AusQuest has plenty of cash to fund its West African hunt and its portfolio of Australian exploration interests.
At last count, it was holding cash of $16.4 million or about 7.2? a share. Add in the $1.87 million it is owed on the sale of an iron ore tenement and cash-backing is about 8? a share or more than half of the current share price. Mind you, the company is not sitting on its cash, with as much as $9 million earmarked for exploration in 2011.
Should the Burkina Faso project live up to its early promise, AusQuest could well spend more than that.
AQD Price at posting:
16.0¢ Sentiment: None Disclosure: Held
