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Golden Arrow VP of Exploration Brian McEwen on Chinchillas Heading Into Production with Silver Standard & Potential Exploration Upside

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is VP of Exploration for Golden Arrow Resources (TSX-V: GRG)(OTC: GARWF) Brian McEwen.

Golden Arrow is a member company of the Grosso Group, a group which was a pioneer of the mining industry in Argentina n 1993 when mining was opened to foreign investment. The company is currently focused on its flagship Chinchillas silver-lead-zinc project, which has a strategic partnership with Silver Standard, who operates the Pirquitas mine just 35 km from Chinchillas.

Mr. McEwen is a professional geologist with more than 30 years of exploration and production experience in open-pit and underground mining projects and operations.

Mr. McEwen has overseen projects in Canada, the U.S., Europe, Asia, Africa and throughout Latin America. His experience ranges from project management to economic resource and reserve calculations for several precious and base metal companies. Companies that include BHP Billiton, CM Antamina, Teck and Phelps Dodge among others.

Brian, thank you for joining me. I provided a brief overview of your background and of Golden Arrow, and we’ll talk about the Chinchillas project more in depth in just a bit, but could you please share with us how you got involved with Golden Arrow and what attracted you to the Chinchillas project?

Brian McEwen: I joined Golden Arrow towards the end of 2012. The Company was just starting its second drill program at Chinchillas. The first program was very successful, having hit some really great intercepts of silver, lead and zinc. I looked at the drill results, the new interpretation for the deposit, the overall location and geologic setting and I was pretty convinced that with more work this would be a viable mining project.

Gerardo Del Real: For those not familiar with the Grosso group, which Golden Arrow is a part of, can you share with us the influence that the group has had in Argentina and specifically the mining sector in Argentina? An Argentina that has new leadership that appears to be much more mining friendly than leadership in years past.

Brian McEwen: The Grosso Group, headed by Joe Grosso, is a management company specialized in resource exploration and focused on Argentina since 1993 when the country opened to foreign investment. Prior to Chinchillas, the Group had two major discoveries under their belt – the Navidad Silver deposit now held by Pan American Silver and the Gualcamayo deposit which is now with Yamana (TSX: YRI)(NYSE: AUY). Joe has focused on community and government relationships, which have helped the Group acquire and move projects forward, and which should position them well to work with the current government both at the federal and provincial levels.

Gerardo Del Real: Excellent. Now I’d like to talk about the Chinchillas project. It’s located in a mining-friendly province in northwest Argentina, it has solid infrastructure, a resource and a strategic partnership with Silver Standard. Can you share with us a little more about each of those points and explain in a little more detail the unique arrangement with Silver Standard (TSX: SSO)(NASDAQ: SSRI)?

Brian McEwen: Chinchillas is located on a provincially maintained road so it has year-round vehicle access, as well as a powerline nearby. Our current resource is 155 million ounces of silver equivalent in the measured and indicated categories and another 90 million ounces in inferred. That resource is about 80% silver, with lead and zinc making up the rest. About a year ago we announced an option with Silver Standard to form a combined Argentine operating company, in which we would be 25% owners. The company would include Chinchillas and their operating Pirquitas silver mine which is about 35 km to the southwest. It’s a unique deal because it gives us the opportunity to develop Chinchillas quicker and cheaper using all the mine infrastructure at Pirquitas while acquiring a 25% interest in the cashflow from Pirquitas. And the current program to advance the project to a prefeasibility level is being funded by Silver Standard at no cost or dilution to our shareholders until the option is exercised, so it’s quite low risk.

Gerardo Del Real: I’d like to talk about the project because it provides you and your partner with options. My understanding is that mineralization starts at surface, there is a high-grade silver core in the Silver Mantos zone and there is the aforementioned Pirquitas mine nearby, which could potentially allow for open pit mining and shipping of material to Pirquitas, is that correct?

Brian McEwen: Yes, you are correct on all points.

Gerardo Del Real: The deposit is a silver-lead-zinc deposit, how are the recoveries?

Brian McEwen: The recoveries and grades are excellent. Our metallurgical test program showed that we could use conventional flotation processing to separate saleable lead and zinc concentrates. The vast majority of the silver reports to the lead concentrate, which is ideal. Overall recoveries for all three metals were over 90%.

Gerardo Del Real: Brian, you have a resource of 155 million ounces of silver equivalent Measured & Indicated ounces, near-surface mineralization, a unique arrangement and great partner in Silver Standard. You also benefit from good infrastructure, can we talk about the exploration potential?

Brian McEwen: Sure. The main focus of future resource expansion outside of the current deposit is to the south. We have had several holes up to 1.5 kilometres away that have hit some long intervals of silver and zinc, in many cases showing similarities in setting to the Veta Crucero structure at Pirquitas. On top of that, much of the rest of the property is still untested by drilling.

Gerardo Del Real: Brian, it’s been a pleasure having you on. Is there anything you’d like to add?

Brian McEwen: Just that it’s a pretty exciting time for the company. With the Silver Standard deal at Chinchillas we are positioned to move from explorer to producer in a very short time frame, and in the meantime we are continuing work on other projects to make our next big discovery – so stayed tuned!

Gerardo Del Real: Thanks again for your time Brian, I look forward to talking with you soon.

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