In April 2004 Aurelian announced results from 8 boreholes drilled in the Bonza Las Peñas prospect, just south of Fruta del Norte. The most successful bore hole showed 114 meters of 1.58 g/t. Mineralization could be traced over 500 meters and was open to the north, to the south, and to depth. Aurelian’s methodical exploration program was beginning to show early and promising results.

It was in this context that important clues for a similar or even larger deposit in the Fruta del Norte prospect became obvious. Fruta del Norte was interpreted as the northern prolongation of the Bonza las Peñas trend.

Interestingly, Aurelian’s geologists found proof of another fault zone in boreholes in a nearby copper prospect. This fault zone was found to offset the Fruta del Norte zone for about 250 meters to depth against the Bonza Las Peñas deposit. This meant that a possible new deposit in this zone was protected against erosion by the overlying sediments. So chances were that a new discovery within the Fruta del Norte zone could be even larger by volume than the Bonza Las Peñas discovery.

All this information was made available by Aurelian via their website. However, the market did not recognize the importance of these geological clues. Aurelian stock declined after the Bonza Las Peñas announcement and consolidated at low levels throughout 2005.

Summing it all up, astute investors had a chance to recognize Aurelian Resources as a speculative play with significant chances of a major discovery early on. The necessary information was hidden in plain sight on their website. Aurelian kept updating the reports, maps and cross sections on the website with great detail. As a matter of fact, Aurelian had one of the most informative and best structured websites of all junior gold companies. The quality of geological information they provided was outstanding.

aurelian’s potential was not so obvious early on. i bought in when it was a penny stock, but it was more a matter of good fortune than any brilliant insight on my part. b-l-p was the first deposit they found, and the stock price ran up to around $2.50. but then it didn’t pan out, as they could only define a half-million ounces, and they did not want to chase it to the north under the sandstone cover. there was internal debate within the company and the geologist stephen leary argued to drill fruta del norte. so they drilled blind holes (i.e. no evidence of mineralization at the surface) and the third hole hit 189 meters of gold.

but it was not at all clear that fruta del norte would be better than b-l-p, or that there would be anything economic there. and the chart prior to april, 2006 would have been of no help at all in predicting the huge advance in the stock price, as it was entirely driven by discovery. the company certainly provided a lot of geological information on its website, but prior to the discovery hole the stock price was back to 50 cents and the market cap was only about $11 million. the stock price mysteriously began to climb in the few days before the discovery hole was announced (funny how that happens) and then was halted, closing up 230% when trading resumed.

there were other regional deposits like el tigre that management liked even more than fruta del norte, but yielded nothing but dry holes. so hindsight is 20/20. we hope the next hole is going to be a monster when we invest in exploration companies like aurelian and noront, but aru was a very rare elephant. while i won’t say the gang at aurelian was just plain lucky, it’s worth pointing out that 1) they didn’t find anything else that was economic in their 95,000 hectare land package in ecuador, not even the missing part of f-d-n west of the fault line, and 2) none of them has had any great success anywhere else. and for what it is worth, i wouldn’t trust anything joe hamilton (or anyone else from the aurelian board) says.