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Stonecap keeps Aurcana at "Outperform" after Shafter results

Stonecap keeps Aurcana at "Outperform" after Shafter results

Stonecap Securities has retained its "Outperform" rating and $1.25 price target on Aurcana Corp. (CVE:AUN) after the junior miner intersected high grades in surface drilling at Shafter.

Aurcana is a Canadian junior mining company which owns 100 percent of the Shafter silver mine in Presidio County, Texas.

Amongst the recent assay results, drill hole S-12-403 intersected 30 feet with an average grade of 23.37 ounces per ton silver (opt Ag) - the current measured and indicated resource at Shafter grades around 8.6 opt Ag. Several intervals also had significant trace amounts of gold which had not previously been reported at Shafter.

The first dore bar poured at Shafter assayed 79% silver and a surprising 11% gold.

"We currently do not model any gold production at Shafter and if gold is widely disseminated in the deposit than the economics of the project could be significantly enhanced," Stonecap mining analyst Christos Doulis said.

"...while the magnitude of the gold potential at Shafter is difficult to quantify at this time, it represents significant potential upside for the company."

Aurcana is currently constructing a secondary escapeway before it can commence commercial underground production
at Shafter. While the escapeway is being constructed, Aurcana is extracting ore from a small open pit mine on the
property.

Stonecap's Doulis added that the company is still looking at ramping production up to 2,500 tons per day (tpd) from 1,500 tpd during 2013, which "could increase production significantly beyond our current forecasts".



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