new update from the 3rd may FYIPhaco Hill Encouraging Diamond...

new update from the 3rd may FYI

Phaco Hill Encouraging Diamond Drill Results
AusQuest Limited (?AusQuest?, ?AQD?, ?Company?) has intersected thick gold-mineralisation during diamond drilling at the northern end of the Phaco Hill prospect, part of the Comoe JV (AQD 51%, Endeavour Mining 49%) in Burkina Faso. The latest results are from 5 of the 16 diamond drill holes completed at Phaco North with the new zones ranging in thickness from 53m to 125m with anomalous gold mineralisation averaging from 0.28 to 0.8g/t Au and include 17m @ 2.35g/t Au and 7.9m @ 1.84g/t Au.
AusQuest has now defined 4 main targets (Phaco North, Phaco Central, Phaco East and Phaco South), with reported good-grade gold to the north and south. Mineralisation remains open in all directions with results awaited for the remaining 11 holes completed. The aim of the diamond drill program was to test deeper conductive electromagnetic (EM) targets which have the potential for Volcanogenic Massive Sulphide (VMS) style systems.
More drilling to unlock economic potential
The Phaco Hill prospect (1km x 400m) is located within the Komoe tenement area in the southern parts of the under-explored Banfora greenstone belt. During previous exploration by AusQuest at Phaco North has intersected anomalous gold including 26m @ 1.26/t Au within sulphides. Sulphide mineralisation is thought to be the cause for a number of discrete conductive EM anomalies within the area which have now been tested by diamond drilling. Thus far, higher grade gold values have been associated with an increase in sulphide content, with gold grade increasing with depth. We see more detailed drilling as the key to unlocking the economic potential of this area.
Phaco South larger EM targets to test
Five diamond drill holes have been sited at Phaco South to test beneath the level of previous RC drilling which returned 2m @ 41.8g/t Au and 8m @ 7.75g/t Au. The completed diamond holes have intersected two zones of sulphide mineralisation at depth with assays pending. Both these zones are wider than the intersections previously reported, indicating that the target zone is getting wider with depth. Gold assays for the cored holes are expected in the coming weeks. Completed down-hole EM implies large vertical extent for the sulphides in this area (Fig.2) and further encouraging results from Phaco South are expected.
More targets to test, we recommend AQD as a Speculative Buy
The Company has another 8 priority targets to test over 4km south of Phaco Hill within the Komoe tenement. Diamond drilling has commenced with the testing of some of these targets. Systematic RC drilling at Siniko West continues with 50m-spaced holes along section lines to test a 5km long gold anomaly. AusQuest is planning to spend ~$3m on exploration during the June quarter in Burkina Faso.
AusQuest has a current market capitalisation of A$34m for an enterprise value of ~A$18m. We expect more positive results from on-going West African exploration and work programs across the Company?s Australian projects. We recommend AusQuest Limited as a Speculative Buy.