Liberty Gold (TSX: LGD) – No More Dilution for Shareholders (Potentially)
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Liberty Gold (TSX: LGD) – No More Dilution for Shareholders (Potentially)

January 21, 2020

Good morning and welcome to Crux Investor. We’re here today with Cal Everett who’s the CEO of Liberty Gold.
There a TSX Explorer and Developer with a so it’s mainly in the US now so
do you want to count how are you good my own grain yourself not too bad a year
you’re soon to be jumping on a plane so appreciated being here what do we start
with a two minute elevator play it’s just kind of set the scene for people
who new to this story and good up exactly what Liberty Gold is Liberty
gold is a focused on Karla style or sedimentary hosted gold systems in the
Great Basin to the United States in Nevada Utah and Idaho and the company
has a portfolio of assets around the world not just spent a week in Turkey on
our Turkish assets because there’s a monetization process we’re working on
there with our partner tech corporation to try to monetize those projects and
effectively just make the company United States focused only sediment roasted
gold in a stable political geopolitical jurisdiction with the state of Tax
Policy where it’s easier to permit mines so our focus is all of our expiration
dollars going to the United States but 90% of my time goes with regards to
monetizing those Turkish assets and basically the reason the logic is if
those assets do get monetized and I’m not gonna promise anything at the at
this point whatever we get back from those assets is money in our Treasury
with absolutely not a share of dilution to the Cheryl’s right that’s the logic
of it all and then you don’t have to go into these problematic markets where
it’s tough to find money and you’re already fully funded for a year or two
three years to come and that just propels the company forward when people
are other groups are being held back right okay so we’ll get into the digs
out the USS us in a second but let’s just cover off the the Turkish group
another asset for how long that originally the predecessor company to
Liberty gold was frontier gold and then it stock dividend became pile of gold
after carlin discovery we we made in I think 2009 was sold to Newmont for
your 2.3 billion Canadian in 2012 and then the assets in Turkey respondent to
pilot gold and I’ve named changed the company with two liberty gold to show
where the company focus is so we’ve had those assets for quite a while and
originally two of the assets the car as lead project and the adopt project in
Turkey were sold to Alamos for 83 million dollars and I think 2009 or
something like that and that money went into drilling the long Canyon deposit in
Nevada for frontier and then that subsequently became at 2 million ounce
plus deposit at 2.0 9 grams of oxide and then Newmont paid up at a $1,900 gold
price to purchase that mine and that mine right now is the most profitable
mine in Newmont with all in sustaining costs of three and fifty nine dollars an
ounce and so now the reason there’s more interest in Turkey as as you know
there’s a deficiency projected for copper concentrates and Turkey is open
for business and I don’t think people recognize but they’ve permitted 15 mines
in 15 years in Turkey so they can from start to finish
a Turkish mining company takes about three three and a half years to make get
a mine in production with all the permits and they’re producing if you’re
going into the United States in the sedimentary hosted system might be seven
years if you go into Canada it could be ten to fifteen years so why because our
shareholder base and the companies we talked to who are reviewing our Great
Basin assets would rather the company be presented to them with one soil focus
because perhaps the jurisdiction they prefer to be looking into is only is non
Turkey and owned the United States well it confuses your shareholders it Fischer
yeah for sure okay say the ticket is a Turkish asset wasn’t a mistake it was
something that was inherited yeah but it became a tremendous discovery right and
what are you trying to emit a similar type of two teams used to know it’s a
perfect copper deposit right okay it’s 125 million tons of point three five
copper and point three five grams gold what are you gonna process for selling
it at the moment mother has always been a process going
on but we don’t need to use a banker I know how to do that myself
right as this tech I’m also quantum ER we’re talking about in terms of price
range yeah I won’t give you that not even roughly not even a guess right
okay okay but you’re expecting a sum of money which will come in as cash per day
yeah we hope so yeah I can give you a quick second or a minute on what the
economic show okay so in 2015 we did a PE a on it using the Turkish lira at
point four four two one it’s now point one seven two one
so at that point there was a projected 345 million dollar u.s. capex
and an after tox IRR 43% but now the lira is point one seven so with every
point one of the lira the economics of that project improve and after-tax IRR
by approximately two percent so now if you go from four four two point one
seven to use current metal prices we can just change the numbers in the PE a and
put in a new estimate of cost to build the mind of approximately 240 million us
the after-tax IRR would exceed 80 percent with the payback period of less
than a year with a fourteen year my life so what one of fun universes would be
interested in that I mean because we have a forty percent interest in that
case and then I’d be subject to random cash calls in a mine production scenario
that I would have to finance going through time which could be a killer for
the capital structure of Liberty gold right you always have to look forward to
what could go wrong before it goes wrong in this business and the operational
side of the industry quite often doesn’t because they operate in herd mentality
but in our side of the business is different Cespedes sings he sings a
business which is going protected on our own over 80 percent mm-hmm it’s not
interesting enough to the market because things go wrong that’s a grab hang out
yeah so businesses with IRS projected oh there any political going easily go into
production now right if they’re in the right jurisdiction right so you send a
key the key differentiator differentiator here he’s purely the
jurisdiction yeah the geopolitics or anything yeah I
mean if a Canadian company wants to walk into any Eastern European country
they’ve need kind of an Eastern European in order to get through the procedures
that that government declares in the mining industry it’s as simple as that
so we come in with tech corporation the project is quite frankly not big enough
for tack it’s not gonna move their balance sheet by anything and for us
being a 40% owner of a mine right it’s not that relevant to us you think okay
so you don’t mean so you think turkey is a good place to do it mine it’s a great
place to mine but not for you but not for us no because of what it’s basically
you have to make a choice when you’re running a public company and the
management make a decision are we going to get more ounces out of the Great
Basin mm then we are in building a mine over three-year time period suddenly two
drawers on your on your balance sheet and the answer is really quite easily we
should be in the great base and that’s where our bread and butter is made okay
so this is like we’d say that’s a change of direction for the business or a
refocusing but refocusing and refocusing their business and so let’s get on to
the relief to believe turkey mm-hm you know sales process there there’ll be
some monetization event we hope yep at some point in the not-too-distant future
right that’s your work yeah okay right okay that’s the bad
maybe so let’s talk about the the the assets that you’ve acquired I mean where
did you find them when did you find them and tell us gives it a little summary on
each one although there are four inclusive of Baxter Springs I think
looking at the document you’re looking at there’s actually five and now there’s
six right okay so those assets are selected by Marva Smith or VPX and the
same geological team has been together for 14 years give or take and the group
of four geologists have at this point a new one started the other day and that
excludes how they la that’s their discovery in turkey the Turkish
discoveries are theirs what’s the steam them for this Oh Karla
Starks Karla style gold upon us right so right now they have 8 operating gold
mines that are profitable under their discovery belt right and so that group
Moira entered came any big ones that we’ve recognized long Canyon right
okay Penasquitos le Mon her tortellini people once mogul in Alaska oh yeah that
can keep going yeah economic kiss means different things to different people so
yeah okay they’re a rarity in the mining industry it’s okay that good and they
they have a running man date with the company you go crazy and if you want
something call me and if I can get it for you I’ll get it for you and if we
can afford it I’ll try and get it for you and they just keep looking at things
as we go and so they picked the gold strike target in in Utah and I wasn’t
working for the company then I joined when when the the company was changing
their president and Marco day came to see me had lunch and he said would you
be interested in coming out of retirement because I retired at 59 right
like I was like you institutional mining and corporate finance and all that and
and I said what is it he said what’s the Gold Strike project in in Utah and he
didn’t know but I represented a second buyer for that asset I’d already done
two or three months of due diligence on site recently before before I came right
and I it was another buyer and I can’t disclose to the virus and I can’t
disclose what my price was but they pilot gold won the auction and they got
the asset so I was comfortable with the asset that was easy
and so pick that up and then after that I was there for I think a month or two
and I went to where and I said anything else want we’ve got many she said I want
the black the black client project in Idaho and I had that secured in 48 hours
for 800,000 u.s. in cash and three hundred thousand shares of the company
and a half percent NSR going to the property owner so they could take the
end SR and retired the liens on the property right yet agreements weren’t
officer no I had I had an exclusivity period done and ready and then it took
two or three months to close it that’s right because it has to go lien free
because you won’t take on the liability and then they company already owned the
kinsley deposit which is in sight of long Canyon and there’s I think 522
thousand ounces of 43-101 compliant gold there and then the backs are strings
project is south of Kinross around mountain mine and it’s 15 square
kilometers of a crisscross pattern of Jasper’s running as high as 15 grams at
surface and there is independent drill holes in there of you know 33 meters of
22 grams but that’s obviously running down deeper though but of a vein
structure okay see you summation phrase there second ago when you brought into
gold we have the money I want these assets what does that mean
it means if we think it’s got two million ounce of potential we’re not
gonna stop buying right as long as we get it at our price I’m not paying up
for anything it’s shareholder money okay and how much
cash was available at that time for about 10 million Canadians living oh
that was to run all the expiration at GNA and everything right okay so once
you buy one of these projects or acquire it they come with a tonne of expiration
data you didn’t have to pay for so on the Gold Strike property it came with
1519 drill holes so the permitting process in the United States is onerous
whether you’re dealing with Forest Service’s of the Bureau of Land
Management so by the time you start a permit and get your final plan of
operations it can take two years so that’s a time suck that you have to wake
work your way through really and so it takes two years and we now have a plan
of operation that allows us to do what we want where we want at this point in a
gold market they’re all there there’s no waiting anymore
black pines done its drilling today Gold Strike has done two of the major
deposits of being drilled contemporaneously in the in the US right
now and there is one long standing on Kinross and backs of Springs no but we
also own the old Griffin mine which is another oxide system we’ve never gotten
to it just sits there because we’re just too busy on the two main projects and
recently we were informed by coral reef LLC out of New York and that the Regent
deposit was around just under three hundred thousand ounces of stackable
gold equivalent gold and silver is in production now and the company owns a
15% NPI after payback of initial cost in that and that’s going should hopefully
be paying us revenue at the end of next
year okay so that sounds like a lot of moving parts there’s also parts here and
that cost money yeah so can we just talk about the finances
sure you can okay so what’s your cash position right now I think it’s around 7
million u.s. or something right that’s gonna get you through Blackburn really
oughta get us through to the through the last quarter of the year but if our
monetization process in Europe works I don’t won’t be looking for my
exhaustion when what do you mean by monetization process the Turkish
innocence right okay so and that’s the enemy assert you’re looking to blow
that’s at this point right okay there’s inquiries about some of the
other assets to purchase them as well so what happens if that doesn’t sell and
then I’d be dealing with strategic investors for major mining companies and
I can always raise the money every financing is dilution or every single
issue on the market right okay you mean you’d be kind of a kind of interesting
period I mean I’m looking at the the share price you know highs of about 48
last year loads of 29 first of every this year’s at 43 we’re back down to 35
look at this behind it looks like a lot of charts well swing down yeah manage
keep it relatively we’re a lot season song and all of that kind of good stuff
that happens in Canadian markets but that suggests is a lot of uncertainty in
the market as to what you’re doing do you think this news story has we
generate a lot of news right and we’ve got a lot I think maybe 10 institutions
right so that owner stock yeah the van eck fund not the GD XJ but Jo Foster’s
fund owns with his warrants 19.9% of the company the ICF fund out of Denver
they’ve got about 14% the company there’s several other funds up there
insiders I think are at 6.6 percent and I’ve only been there not even for three
full years in my first year I bought 2.4 times my salary got this talk in the
market yes you see yeah and I bought it the year be last year
and the year before last over two times my salary
yeah and it’s basically I just made all my money in my career in bearish markets
and if I can find deposits that are going to make money in a bearish market
I load up and when my market eventually comes to me I monetize that and I live
very happily after that right so you have to have patience in this business
yeah it’s not a trading business see so this is let’s go but a bunch of
institutional shareholders they’re sitting on quite a hefty yeah I can talk
to 70% of the shareholders on any given day right that’s awesome
and you prefer to smoke I did retail but I don’t know that is retail is fine institutional means they’re just bigger
positions the solidity well there’s a lot of liquidity in this stock it
averages three hundred to five hundred thousand shares a day which is good for
institutions so if they want to get out they can get out if they want to get in
they get in and I don’t I’ve been around long enough that I’m not offended by a
sell order because if you bought the stock you have the right to sell it and
right if you buy the stock you hopefully you make a profit we do it jobs and so a
lot of people who run junior mining companies don’t like the unexpected
market cap shock of a big sell order when they’re not prepared for nor could
they get prepared for it and that’s why you see some of those charts anymore
just straight down with this kind usual I mean institutional guys something they
typically you know no it’s not not in this market because it yeah because if
you’re gonna fund and I know several of them I talked to 50 of them and all of a
sudden one fund I know has had a cash withdrawal from his gold front all but
one day in the last thirty years so if he’s got $50,000 that he has to show up
with cash on that day he has to sell fifty thousand dollars with gold stocks
yeah okay that’s the way it works and if in if he’s got an inflow his mandate is
he’s got to go buy fifty thousand dollars worth of gold gold
okay we have to agree to disagree on our homeland fight but as usual or unusual
no this is certainly not what we’re saying with a lot of people that we’ve
been talking to since the institutional’s guys tend to hold a
little bit longer guess any of their end that retail guys my net worth family
officers tend to drive the quiddity and they have no effect on volume of trading
this day so interesting to see how that plays out so with with the business I
know it’s gonna morph to since you’ve well you know from before you’ve been
involved no saint giving you plausible deniability or anything but it’s it has
morphed in the sense that he had this Turkish NASA we’re now gonna be focused
on the US as a better just diction politically and safer and all of those
things that people say do you mean how much money’s actually pumped into the
into the business and how much has come out and has it oh those numbers are easy
they’re public okay right yeah so on the on the do you want me to start with the
production side of the industry I could go all the way down from just discovery
since 1992 as you say it’s all it’s a public it’s all you know there’s a lot
of numbers there I mean I would rather you focused on where’s the value coming
from for shareholders potential shareholders
you know people be buying into this the money the actual exploration
expenditures are down by 66 percent since 2012
okay so no money is going into the ground on the production side of
expiration they shut down their expiration effectively they’re only
looking for brownfield extensions of existing gold deposits that are in
operation and so they’re not exploring nor are they making discoveries
so the production’s not drilling the explore is we’re here for a couple
decades the the the supply chain of the future of the mining industry and we’re
not exploring there’s only few of us who can afford to explore and those
discoveries are few and far between like you don’t see them anymore
and I think there was no five million ounces
discoveries last year whatsoever and every year the mine life for these
producing mines are falling since 2012 the average mine life has gone from
fifteen point seven to twelve point four years and if we haven’t explored for
seven years and the permanent time on top of that you know ten years out you
might be seeing average mine lights around seventy seven years for the
producers and then we’re gonna then throw a price for logic legal smoking
but it’s it’s it’s all about funds so if I was looking for funds now and you can
see it with a lot of majors they’re still taking equity interest in public
companies and a lot of juniors are continually going to juniors to the
producers looking for them to invest and there’s private equity funds which sit
on a fortune and they’re very very conscious and they’re they’re taking
advantage of the people who are being crippled and that’s that’s part of the
pitch for explorers they took about this deficit and what I guess people want to
understand is how you’re gonna actually deliver that sort of hope you’ve got a
expression team you’ve been together 14 years mm-hm
they’ve discoveries they’re responsible for a lot of asses out there what gives
you encouragement and I mean you have got encouragement cuz you’re putting
your money into this thing right now sure what encourages you to believe that
these assets these six assets are gonna be able to deliver those answers well
we’ve already got 1.2 million ounces that Gold Strike is a good start it’s a
good starting point and but that needs to get to 2 million ounces so it’s now
being drilled to get to too many ounces so when we did a PE a on that we
released it last year across Germany on cents that’s just one project that’s
just don’t go strike just 10 gold strike right now okay okay so we did a PA on it
and there’s a good PA in a crop PA we both know that you can do a PA and 42
goals oh yeah it’s like your whimsy in some
cases you have to really understand what you’re doing yeah so in that PA because
of the way our geologists operate and they do their compilation work that had
at 1,700 drill holes in it that’s a good PA and 75% of that resource was measured
that’s three holes within 50 meters of each other well within 50 meters that’s
how tightly drilled that density is and to do a pre fees you have to have
measured and indicated so we’re 3/4 of the way through that on
that deposit that’s how prepared we are to deliver
right to the end point whether your needs are over 30 percent of the target
oh it’s just money it’s money driven and drill holes it’s cheap to drill okay
because they’re short holes and there are see holes right and their permit
allows us to go wherever we want so we can drill some days to fold or to drill
holes in one day and we pay by the hour right so it’s your drill costs are going
down and it’s just the same geological costs and management costs are on that
and the asset cost is a fixed number so on that PE a the after-tax IRR I think
was at $1,300 gold was twenty nine point four percent but we excluded by-product
silver which is historically the mine yeah produced an ounce of silver for
every ounce of gold so that would have popped the after-tax I arrived by maybe
a point ass we excluded the heap leach pads which we’ve drilled we have the
permit to perforate the liners know the heaps and there’s 8.1 million to start
tons there but the grade on those staff tonnes is twice our cutoff grade so you
could crush that heat bleach pad and put it as the base of your new heaps and
you’re gonna get more ounces and the average recovery in that mine was 75%
and we’ve done our metallurgy on it and we’re just about finished our second
round so that news will come out soon and we get 70 80 % of a recoverable
cyanide leachable gold in 8 days it’s the best in the Great Basin right so if
people don’t understand what a heap leach operation is it’s like a quarry
right yeah processing it’s a great there’s a load great yeah yeah sure I’ll
give you the numbers for the for the big meat producers in the great base and the
average grade is 0.53 grams for a run of mine he bleach ours is 0.48 okay yeah
their recoveries average 70.5 3 R’s are 78% but our ours is in 78 person
and I’ll tell you why because they rant they rinsed the heat bleaches for three
years after that mine shut down right and produce 45,000 more ounces right so
that’s real recovery it’s 75 plus the 45 on a percentage basis which takes you
over 80 percent it’s just a unique deposit that leeches like it down right
so we need to take it to 2 million ounces which gives you right now I think
it’s a 7 a half-year mine life excluding last year’s drilling at 95,000 ounces of
gold year so the target has to be a hundred thousand ounces which meets the
base for an intermediate gold producer for one mine because we’re certainly not
going to drill something for a 30,000 ounce producer that’s just a waste of
our time right just like a hobby if you’re gonna go down the food chain that
low and then it goes up to ninety five thousand ounces right so we want to take
it up to a hundred thousand and ten to twelve you’re mine life which solves the
problem of a producer with declining mine lives with to ignore if you say
this is a fairly easy business really your counsel bull you say 0.5 grade it’s
like no it’s just a numbers game for you oh well it’s easy I mean if you go look
I’m not sure as you know behind me but that credenzas about about 12 cubic feet
here that’s a time that’s a what a ton of rock look like if you wanted to model
it in 3d but it’s the strip ratio is everything right exactly right because
of and the metallurgy so if the cash flows quick and the strip ratio is one
point two to one it costs you a buck II need to move a ton of waste and a dollar
to move a ton of ore because it’s got to be drilled differently you take the
grade and then say it’s $22 Rock and you’re gonna get eighty percent out of
it so you might get $18.00 Rock and if all your handling costs and processing
costs are $10 or $8 or $9 yeah that’s your profit okay on 75 million Tesla
yes asking very easy why should people believe you guys can do this because
it’s an easy well trodden path you’re really just a
pendant on the grades continuing yeah but we’ve done it before we built a mind
before right and now you go and Burkina Faso we in order to build it we have to
de-risk it build it and sell it or de-risk it and sell it okay
right it’s just a very very simple process okay so the thing that asked
this question see if that’s the case so where’s that where’s the barn you coming
in woody I mean obviously we’ve got a
potential sale coming down the line was a bit of cash but that’s gonna go
straight back and round gasps there’s no no real upside there for existing
shareholders okay the upside is there Cheryl the base stays exactly the same
with no dilution it’s a massive upside masiva okay I’ll buy that
so where’s the other value coming from the other value is probably the black
pine project right which is now leptin front of gold strike because of what we
found but okay if money you could seven million bucks of cash so we can say left
and front well how does that cash distribution or allocate more money is
being spent drilling black pine this year than goals right how much are to be
about probably 30% more based on the budget okay yeah yeah we just started
drilling it a week ago right but it’s it’s it’s it’s it’s unique we found
something we that we never expected we would when we bought it what was there
wasn’t he found out only I can tell you what say okay show then yeah because we
bought a past producing mind it was the old Pegasus – shut down in 97 right it
stacked six hundred and eighty-five thousand ounces to produce four hundred
and thirty five thousand ounces of gold from five aggregate pits and we bought
it with five hundred and sixty drill holes in the database with the
recognition that wasn’t we didn’t have the data we had to start from zero so
what Vaughn did he could own that and then what we bought it for a million
dollars it up in aggregate yeah what do you think that looks like on your books
man it looks substantially more yeah right okay okay so you got spend a bit
more money on it this year you think that we just spent eighteen months we
went into our geologists found the data right in a Forest Service’s file that
the own vendor did not know they had and in that Forest Service file was 1875
drill holes every blast hole every soil sample all the two physics all the
cyanide soluble assays absolutely everything took 18 months to put it
together and get it permitted and we came up with a model on it that
we were sitting on something and we published a 2 to 4 million ounce target
on that and at this point where we’re sitting
based on their valuations we think that could be conservative and it’s the
largest unmindful to the Great Basin and I’m not exaggerating
we’ve defined 12 square kilometers of exposed oxide gold at surface okay okay
and so the average depth of the historical pits was 100 meters and
there’s not a drop of water in those pits okay
is it deep the drainage groundwater any groundwater that’s there
flows into the dry part of the Great Salt Lake there’s not a fish on that
side in a dry Salt Lake there’s no environmental issue
there’s Road there’s power there’s water to site okay so we applied for the plan
of operations we have the right to go anywhere we like and drill where we like
over 7.3 square kilometres of oxide right so in the modeling of the entire
project after all this work we twin to historical drill hole and the holes that
95% of those holes only goes go down to 300 feet or 93 odd meters and our belief
was there’s a high-grade portion at depth based on all of our modeling and
so we twinned a hole in late nineteen start of 2017 and it was 40 meters of
0.5 grams and then there was a gap and then there was 5 meters of 1 gram gold
oxide and has stopped in oxide because the drill of those days the miners were
shut down and just says Stockton or so wheat wind it and we hit 40 meters 0.58
then the gap because there was a calcite bretch in there and then we hit 15
meters a 1.2 grams and then we hit another calcite brejcha and through the
bottom of the hissed system we hit 77 meters of 1.4 9 grams oxide ok ok so
whopping great but in a 200 meter hole 132 meters ran over ground pond average
you don’t see that in the Great Basin so we now know that the target depth that
it has to be drilled to depending on where you are and where you’re exposed
in the rocks on surface over that massive 12 square kilometer
is between 150 meters to 350 meters to get to the base of the system and
there’s no sulfides in that system whatsoever it’s all oxide there hasn’t
we haven’t seen one like this in in a long long time that’s I mean that
doesn’t seem very big to me say but what was it me in real times in real terms a
kilometer by a kilometer yeah by a hundred meters right aggregate with a
specific gravity of two point five six yeah means you’ve got potential for two
hundred and fifty six million tonnes right and if it runs a half a gram yeah
you’ve got 128 million grams right okay Drive divide that by thirty one point
one eighty grams in your over four million ounces and that’s a square
kilometre in the twelfth kilometre drill confirmed oxide system okay okay no no
we we have our own internal models which I won’t give you how many ounces we’re
starting with without drilling right but I would say it’s substantial so that’s
black pine mm-hmm you can spend more money on that than gold strike because
it’s too big because it’s too big and it’s got whopping grades in it right
okay say I guess I’m going to trying to say is you know how do you get what
happened so things don’t kind of go well I guess you would you then flip these
assets out somewhere else you know you think you’ve got enough data now to say
we’re gonna the company company maker I guess is that fair yeah okay what are
you doing with Kingsley Baxter Springs kenzley we spend half a million dollars
on a new year with our partners by a on a contractual
required to spend that and we do spend that and Baxter Springs just sits there
gathering dust because we don’t have time to get to it no it costs nothing to
keep it good in good standing it’s nothing and Griffin is the same thing we
keep that in good standing right and we’ll look at once we figure out the
rawhide royalty whether we want to put monent want to monetize that for for
extra cash or not right right so we just kind of were just analyzing what that’s
worth right now we’re not there yet we’re deal season to you you’re you are
dependent on offloading Turkey no it’s not dependent on anything
because you think you can go to market I can get market I can get it corporately
and I can get it from royalty companies I can get it from everyone it’s just the
timing of what I want to do it well and the cost I guess yes they do the
economics around what that’s gonna cost you know compared to what you doesn’t
want to pay yeah so therefore turkeys the ideal solution
maybe not oh it’s easy out it’s easier and that will give you the cash you need
to go move those to our sites mm-hm being gold striking black pine
where you need it to be yeah go and raise cheaper money at some point of you
know I don’t I don’t think um if things go the way we hope we may never have to
raise money again okay that’s I think you I think you can
dearest well Gold Strike is dearest it’s just my life even answers but my black
pine as well you mean money owes you mean equity or D being done even a debt
you know somebody can make that too if you’re gonna build it all build with
that everything goal did you always need yeah and you’d be looking at 30 percent
equity versus debt scenario because these things are cheap to build right
you know for to get the same amount announces out of the underground mine in
Canada it’s gonna cost you six seven times the capex to build it he bleached
mines are dirt cheap to build it cost you 100 to 150 million u.s. and you pay
it back off if you’ve got a starter pit material which we have it gold strike
and we’re sure we have it at yeah black pine and then your capex is paid for and
you’re good to go it’s that’s really interesting for shareholders sure well
there because you know now that the barrack
joint venture with Newmont is done barracks got Nevada
yeah right so Newmont and other people who want to get into the Great Basin
they’ve got to go into Idaho and Utah yeah and we’ve been tying up Idaho and
Utah now for years yeah right and so that’s why we we
acquire them and we just hold on to them that’s interesting yeah so it was a plan
set out several years ago given the case of the gold market and analyzing all
countries around the world Africa wherever and they fall like Libya just
fell the other day you’re not going to Libya you’re not going to Algeria
Nicaragua’s got problems with the Sandinistas right Guatemala’s got issues
and in parts of Mexico of issues so we effectively government changes military
coups whatever you want to say and and countries that have no money want to
take it from the operating Minds the balance sheets are affected by these
producers so we just went and said okay we’re gonna zero in on unsafety let’s
really those years of years ago that’s really interesting so you couple
years ago two three years ago you decided what when you joined I guess you
say right we need to get back to a signature stick show the strategy will
be this we feel that and because there’s any bearing on Trump coming in here
because he’s obviously Pro he’s Pro mining I mean I think it’s been good for
a lot of people in the region was that what was a part of the process or part
of your thinking but now I’ll just purely let’s get back to the states
where we know what we’ll do we just went to the jurisdiction it didn’t make any
difference who is who is sitting in the throne right didn’t make any difference
at all interesting okay interesting okay okay but I mean why don’t we want to
talk a little bit about you and the team who are going to be delivering this
because you said it’s a pretty you know easy process
it’s okay so I’ll just put putting it together you feel you’re gonna have the
capital to take you through to I guess post dear fast what you’re saying
potentially good things go according to plan this is very encouraging for the
anti-dilution week rant so tell me a bit about you and I know you do and a banker
was quite unusual combination that’s know with that I’m sure I was a
geologist working for the mineral exploration arm of Imperial Oil work for
them for about 12 years until 1990 and worked underground in the Red Lake Gould
campus and underground geologist volunteered to do that
basically because I needed to learn how to think in three dimensions and so
effectively I can spin this room around or anywhere
and figure out what’s going on where I supposed to be geologically and drilling
a hole right because when you’re underground engineer in the dark with a
light on you have to know how to project like a one centimeter controlling
structure with Orem to the left and waist to the right where it’s going to
be 500 feet from there where to drill a hole so I did that and then in late 1989
Homestake mine he took over us all minerals Canada and I had the option
ality search options choice to either go into the oil patch in Calgary and or
stay in Vancouver and go look for work so I decided to become a stockbroker and
I’d never taken an economics business course in my life and so I applied and I
got six offers in one day and I took an offer with burns fry because quite
frankly the training course was five days and I was a broker I didn’t want to
waste my time and and you go from a salary to twelve hundred dollars a month
right it’s really quite funny and my wife is working she was a nurse at that
time at that time and so we were fine and then after four months I went off my
1200 a month and went on to income and then in my fourth year there are is the
number one producer in and for BMO nesbitt burns in Canada other 1200
brokers and was all mining focused and when the when I got into 2002 I tried to
get a take on institutional clients and that’s hallowed ground as you know on a
trade desk because that’s where the big money is
in those days not today but and so they wouldn’t let it so I’ll I just quit and
I went over to p.i financial which is 25 percent owned by national bank and then
I was their number one producer in my first year fill 2008 and over that
period of time I raised I don’t have a billion billion dollars and I think
there was something like 15 billion dollars worth of takeovers there was
failures there always unfair as an exploration when you pick him and I was
just looking for early-stage things that I could look like I can multiply my
clients investment capital on and that was a good gold market so the timing
it’s not necessarily brains its timing sure right and there were very few
people with the geological background who are on the institutional side does
the stem of the mining industry process I mean what
there’s a few mistakes in there no doubt watches the dirty successes so you have
applying not to what we’re looking at today oh well yeah it’s really quite
simple I mean I did the original financings for a Cisco right and it took
me three months to raise them six point eight five million dollars because
nobody understood bulk tonnage gold deposits so what I had to do is go to
the IOC G belt in in Chile and compare it to a poor fee copper and just say
okay this is 0.8 percent copper equivalent and here’s the golden
recoveries the same at at 92% and then I then I got a lead order for nine point
nine percent of the company from a fund out in New York who ultimately made
three hundred fifty million dollars on that trade but you had to reeducate them
because nobody understood them now everybody understands them
yeah right that’s how the system goes and then we started producers and copper
companies and several companies were taken over in those days is that
interesting safe I mean people didn’t understand it back then do you think
they have stunned at that I mean what did what do your brokers say what do you
think how many how many brokers are left I think 85% of trading or passive
investment farmers in theaters now yeah I don’t think there’s much dialogue
going on between you as my broker and me you giving me advice anymore yeah yeah
it’s just a difference what about the people covering these like and I think
with it’s not true oh yeah yeah I talk to him all the time here right yeah and
every news release we talk and they do site visits and they’ve got an open-door
policy if they want to take their clients to site private or institutional
we’ll set it up they can go pick and visit anytime I think they’re doing a reasonable job
for it but they’re not going to be looking for orders in a public market
because they don’t make any money on the trade because the discount trading is
punished the sell side of the business so they’re looking to finance but so
they get a 5% fee which is what oh sure yeah so seriously you know people’s
business moguls up to change server that over the years as he said when a tenant
used to be making a lot more money people had to change their own they
certainly institutional size change their business models how’s that
affected you hadn’t really affected me because I can do all sides of it right
because it’s it’s like we used to say it was a wholesale retail and fairytale
business right right so the wholesale guys are the institution to want big
blocks of stock and they want to leverage with that then there’s the
retail component and then there’s the dream that you sell but you better be
selling a legitimate dream hmm right and it’s got to be backed up by hard numbers
and facts and reality and qa/qc and everything else and not I’m not gonna
say what companies do or who they might or may not do this is what you have to
do to make it perfect yeah and then if you can find money and create liquidity
that’s the benefit of the industry so I’ve been doing it for 25 years yeah I I
kind of you know likewise unfortunately I know and you know you see different
degrees of understanding from a technical perspective from a financial
perspective and from you know wider market spectrum in terms of all the
different you know I you know we’re talking about retail Hilma sign
everywhere so things like me it was a very little understanding very little
information and actually it’s hard so I think you know what do you think the
market should be doing better to tell stories like Liberty Gold story because
you need to me it seems but a easy story to understand there was a bit of yeah do
you think you’re getting fair value in terms of market cap of the moment or
have you done enough or is it the market you can only do what you can do because
we all work twelve twelve hours a day seven days a week right so if I leave
the office I’m working from home Marco dares our chairman he knows what to do
exactly what I do we’re both trained the same way we can
both raise money but I’m not the geologist I used to be I’m more
financial so you understand I’m not there to go pick we’re drill holes ago
the people who find mines do that my job is I’m paid for strategy and how to time
it out and how to sequence things to move a company forward and you can’t
push on the rope if the markets against you you’re gonna be stuck in the mud one
footing them I have one foot on pavement whether you like it or not until the
market does change the gold price can change that
but the lack of discoveries will change it will I think change the junior
exploration sector faster I get that but again they listen let’s not get off the
micro this the micro here you know I believe that
lot of mining companies could work a lot harder communicating better to their
investors okay and I would encourage certainly our investors our viewers to
interrogate information the company provides very very few people read the
disclosures for instance I thought it was crazy
impressions all there and I’d also say that they don’t necessarily need to have
a tannic or appreciation of what the company is doing but they do need to
understand what questions to ask the company and the company should be able
to give that information away which is understandable to non-technical people
yeah right and we figured that out yeah our websites designed that way yeah I
think you’ve got a good website I also like your the other oxygen capital on
pure gold yeah and I got a couple of others son
missiles yeah yeah so I think oxygen capital I’m doing quite a good job yeah
but what do you what do you think that else what else could you be doing what
more could you do we’re not married are we I mean is I guess I might I might get
I might get that from my wife but you know what more can you be doing around
that because you know you’ve gotta be aware about what’s going on out there
it’s not an easy market for gold you know just don’t aren’t talking about
gold at the moment it’s it’s a great commodity the price is not there yet but
a lot of gold companies who should you know if I’m looking at it from a purely
chart basis financial basis you think well it should be worth a lot more
they’re not so something’s missing well the market song is going to give
you the valuation it’s gonna give and so there’s less investor money in the
market and one of the main reasons is the fact that people have been punished
over since 2012 with tax losses and then they go look at different industries I
don’t people say oh Bitcoin took the momentum out of the mine s crap right
like those are just lame excuses for a few disruptions there’s always been
distractions and so but the as you know through time in the mine against three
things change and a great example is actually the dime
industry when Diamont was found and then the market went out and went crazy
sampling north the Northwest Territories four glacial deposits we found 1g 10
garnet then it became the stocks would go up a dollar based on a G 10 garnet
which is a high chrome nickel garnet yeah and then if you had six garnet oh
my god that sock would go even go higher then everyone says but there’s no
kimberlite serif they spent 10 million drilling the damn things and then they
had to go to something else well we had ilmenite we had rutile we had all these
things and then we closed in oh my god there’s a round anomaly which they
affectionately called dog balls anomalies it’s an old bhp turned and
they drilled these gravity lows and if they hit a kimberlite this doctor take
off and then it got into ten micro-diamonds versus 100 versus a
thousand and then people sales well their micro diamond what the crap does
that mean so the diamond industry grew from over exuberance to reality and then
it calmed down right so copper industry does that as well right so if the copper
price goes from three bucks a pound down to $2 a pound everyone’s sad industr
cobalt goes through the roof and comes right back down right when you’re
chasing an industry with a finite number but the gold industry’s always the gold
industry it’s money it can change it into any currency in the world in any
given day and the reality is there’s ten big producers over a million ounces 25
intermediates 300 to a million and there’s 33 producers and they’re all
looking for the same thing as a cash flow and they haven’t got it and they
have to sit there waiting for two majors to come together to eat the scraps up
that they aren’t material to them so this is how the industry’s gone there’s
no alliance right so ultimately you have to find things that look like they’re
gonna be mined and they’ve got to be big and they’ve got to be material to an
acquiring producing mining company and if we go see an asset and we say 750,000
ounces we’re out of there somebody else now yeah I get that you need to be fun
units plus to be interested oh there hasn’t been a five million ounce plus
found I think there’s one sold gold in in Ecuador has been found as a gold
equivalent basis in the last three years Cardinals are – yeah
yeah there’s not much and it used to be in the 90s you could get up to five or
six of them here on average we’re good for it
where’s the good companies like yourself I mean where we were you know just over
a million bucks at the moment you want to get to – I guess – well right now
that are 43-101 compliant just on Kinsley and black pine we’re at one
point seven eight million ounces of good gold in the Great Basin and the other in
and Turkey were about 1.3 million ounces and a billion pounds of copper and 35
million ounces of silver goodbay does some pretty you know it’s a large pen
with lots of other people like you at the moment how do you move from there to
where you need to be to kind of get I think we have to recognize I think black
pine is gonna exceed the other too easily right and so if you see it and
you can feel it in the drill holes historical data and compilations support
it you go in and you make that big as fast as you can okay
cuz its material okay so let me break a pretty quickly said I always like to do
just because I say to investors look at the management team look at their track
record listen to what they say and listen to what they information they
provide its we’re looking at board of directors and management team who’s
active who’s just a name so just let’s put on the act of people he put a track
record approved could you sing shareholder value and are actively
helping everyone every every board member is that is active each has a
different specialty they were full-time they’re awful well I guess they’re
independent board members but full-time means they’re on tape we haven’t had a
board change I don’t think in five or six years no I’m saying are they
thinking about it with you gold every day always here Marco Day is for sure
every day Marva Smith is she runs all the expiration obviously I’m there yeah
Shawn Tesla is absolutely brilliant on securities and rules and everything else
like that so if we’re gonna go do something he’s the cautionary wise man
at the table he’s docent god oh god yes he’s not he other things can as we don’t
and yeah Donald has the same yeah so everybody is proactive and they’re all
good and Mark and I get along really well so if I need him or he needs me to
do something he we get it done right if I need an introduction
and I don’t have an introduction to the president/ceo of a senior my gold
company but one of the other board members is a friend of them yeah I just
they just like us together we just ricochet around so when I’m working on
behalf of the company half the year I’m on the road why what do you mean I never
stopped on marketing I’m going to say time visiting projects seeing the
geology’s verifying budgets and going meeting mutual funds meeting
institutions you never stop if you stop your article you shouldn’t be in the
business okay so earlier told us about the strategy for the business there was
a clear decision like two years ago as to what you wanted to be doing it didn’t
include Turkey you’re offloading right open to offload turkey get some cash
into the business drive the US so you know and you’re telling me that you know
black pine at this point basically if if if we
hadn’t really hold the black pine and goals all right but we strive gold
strike was two years in advance and when you love it it’s a great deposit it’s
going to be a good mind sure right the economics show it’s going to be a really
good is it going to city from where where you are with a bunch of other
people to you know stand down business we’re gonna be a bit different than
everybody else we’re gonna two of them at the same time right I’m gonna do
black pine and we’re gonna do a gold strike at the same time that’s gonna
create the value absolutely yeah because how many oxide deposits are left in the
Great Basin right very very little there’s ourselves we’ve got two major
ones we’ve got gold standard ventures which has done a great job of what they
found at North darkstar in darkstar and pinion and you’ve got bullfrog I guess
which is Corvis but that’s more of a sulphide system now because the grades
and that’s it the oxides are gone but this isn’t a competition but the Great
Basin that’s great there’s a competition for in versus money against University
companies anywhere in the world that’s greater so I’m you know thinking
globally do you feel that the assets you’ve got and what you hope to do with
them is gonna like a standout globally as a meaningful gold producer yes okay
yes because they meet all the size criteria that everybody’s looking for
right that’s a very simple answer okay good
wonderful job he could be five reasons investors should be thinking about
Liberty gold as part of their portfolio under what investment contact is this
retailer institutional making money many imagine institutional retail high
net worth from the office why should people get your existing shareholders
have got I’ve got a few they’re sitting there they like it it’s traded but you
know they’re sitting there because they believe your story okay you got some
great names on that but that’s credit institution is a lot of people be quite
jealous envious of that but in terms of new investors coming where the
institutional of war number one they have to chart the stock
and they have to compare it to other groups they have to look at the volume
because if they have they want to buy it they have to find they can get out of it
so it’s a very liquid name that’s not a priority on it the jurisdiction is
everything okay right so jurisdiction is is really
important because of the fact that there’s no new discoveries made and
we’re sitting on several in the right jurisdiction yeah and you’re even seeing
that from the institutions and corporates produces out of Australia
they’re all trying to get into the Great Basin because if you’re sitting
two-thirds in Africa one-third in Australia where do you wanna go what I’m
on yeah right so you’re thinking now you’re coming into North America because
they’re shareholder base are driving them towards us and we get a lot of
bonding from those jurisdictions are they you know fully fully permitted and
absolutely done state your yeah if we had picked up these projects today we’re
screwed because if you started a bull market
today yeah we take us two years before we get your interest now we’ve got every
permit in place on every project to drill where we want and we have no time
delay so it takes a liquidity jurisdiction and timing timing right
meaning what timing is we just go to work right well I was delayed by a
permit okay get on with it and just go not a lot of these things are set up
properly for Jesus it’s just so much there is a lot well I for is we’re right
in a line on both deposits at or above what the average run of mine he pledged
operation is in the United States of America I think that’s easy
you got great comps the comps work right right the strip ratios look like they’re
gonna work nicely yes that’s because when we talked about strip ratios before
the strip ratio is six to one it’s 180 yeah costs per ton now I mean
you’re dealing with 10 something Italia no these up margin gone the stripper
ation turned the economics negative so these are my and the fifth one I guess
you’re gonna say potentially things go according to plan your cash go up 3-2
yeah it looks post DFS Pat were cashed up through this year but what that meant
with with the so potential sale turkey oh yeah yeah that’s that’s all fine yeah
and and but the other key point is it hits the minimum threshold of projected
production numbers in the right jurisdiction at the right grade and the
right metallurgy and there’s more than one of them in the company in a market
conditions that we’re looking at today so you’re gonna be on the target
crosshairs of anybody who’s looking for another mind that are cheap to build and
quick to permit thanks very much Catholic would see keeping the rest of
the story as we go forward later this year thank you very much
players thank you very much for watching our video we do aim to give you informed
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  1. Another excellent interview. Do you do any advice on stocks? Have you come across Group Eleven Resources, operating in Ireland?

  2. I'm not so sure I like this CEO, he came off rather arrogant. That said he may be very good and this company may have a bright future but he rubbed me the wrong way. I just listened to a couple other interviews with Rob McEwen and Ross Beaty and they seemed much more humble but both of them were still extremely confident. Just my opinion, maybe I'm completely wrong…

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