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Allegiant Gold Begins Major Nevada Operations

The spin-out from Columbus Gold provides investors with clear choices between two entirely different vehicles, says Bob Moriarty of 321 Gold.

Columbus Gold Corp. (CGT:TSX; CGTFF:OTCQX) made an intelligent business decision when they determined they should vend their non-core assets into a new company. They are retaining substantial ownership in the new vehicle but investors now have clear choices between two entirely different vehicles.

wrote about the company and the spin-out in early December. Columbus Gold will continue to advance their 45% owned gold project in French Guiana. But their partner is Russian, Nordgold, and has no particular reason to be interested in the remaining fourteen exploration projects in Nevada.

The spinout company is called Allegiant Gold Ltd. (AUAU:TSX.V; AZLLF:OTCBB) and began trading on January 30, 2018. The timing could have been better as luck would have it. The overall market crash generated margin calls for many investors and they began to sell everything liquid. Columbus was trading at $0.54 post split and since dropped to $0.38. I heard someone make an interesting analogy about how even good stocks get dumped in a crash. He said, "In an airplane crash, even the pretty girls die." So I stole it.

Allegiant is run by Andy Wallace, the discoverer of half a dozen major gold projects in Nevada. That's his stomping ground and Allegiant has a total of eleven drill-ready gold projects in the state. The primary focus of Allegiant is the Eastside gold project that has a current 43-101 resource of 721,000 gold equivalent ounces in addition to a historic resource of 272,000 ounces.

Part of the spinout deal required Allegiant to raise money. They closed a private placement for just over $4 million in December of 2017. Allegiant plans an aggressive drill program starting with Eastside where the goal is to double the inpit ounces and reduce the strip ratio at the same time.

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