Getting credit for Cte d’Ivoire project tough for Etruscan

Whether the results were too in-line with expectations, or whether they were from a project the market has paid scant attention to, or whether it’s because of the political risk associated with doing business in the Cte d’Ivoire — whatever the reasons Etruscan Resources‘ (EET-T) latest drill results failed to have any impact on the market.

In Toronto on Dec. 13 Nova Scotia-based Etruscan saw its shares finish the day just as they began — at $4.14 after releasing results from some 8,000 meters worth of drilling.

“Unless drilling dramatically changed the story, it’s maybe not as significant in terms of moving the stock,” David Stein, an analyst with Sprott Securities, says of results from the Agbaou gold deposit.

Highlights from the ongoing drill program include:

• 13.4 meters of 13.7 g/t (including 3.1 meters at 31.2 g/t)
• 11.3 meters of 3.5 g/t (including 2.4 meters at 9.2 g/t)
• 7.4 meters of 5.7 g/t (including 1.0 meter at 30.8 g/t)
• 19.2 meters of 2.4 g/t (including 7.3 meters at 5.0 g/t)

The results come from 8,000 meters of the 11,000 meters already drilled. The company says the rest of the planned 16,000 meters should be finished in February of next year with a feasibility study slated to for completion by the end of 2007.

But the project will have to overcome the markets qualms about operating in a region as notorious as the Cte d’Ivoire.

Cte d’Ivoire was divided between north and south ever since a failed assassination attempt on its elected president in 2002. Since then it has been enduring a simmering civil war summed up by the often used descriptive phrase: “no peace, no war”.

While not NI 43-101 compliant, the Agbaou deposit has a historical resource of roughly 18 million tonnes with an average grade of 1.5 grams gold per tonne for 855,000 oz of gold.

Despite those solid numbers, the company’s share price has been driven not by Agbaou but by its recent discovery at Diba in Mali.

Etruscan shares jumped from the $1.80 range to as high as $4.28 in the weeks following the announcement of its Diba gold discovery. Results from augur drilling were released on June 6 of this year and were highlighted by an intersect of 12 meters grading 12.6 grams gold per tonne.

As for Agbaou, the project covers 939 sq. km and is situated roughly 200-km northwest of the port city of Abidjan. The company says the project is accessible by paved roadways and is within 10-km of the national power grid.

Etruscan attained a permit for Agbaou in 2003, and has an 85% interest in the project. The State of Cte d’Ivoire holds the remaining 15%.

Clearly Etruscan would like to take some solace in the state’s involvement in the project. In it’s press release vice president of exploration and chief operating officer, Don Burton, said the company is getting support from the government to advance the project into production by 2009.

“We believe very strongly in the geological potential and the long-term stability of this country,” the statement reads.

Etruscan is backing up that confidence by initiating an exploration program along the 40-km long gold belt that hosts the Agbaou deposit.