Millrock Resources (TSX-V: MRO)(OTC: MLRKF) CEO Greg Beischer on a Busy Second Half of Exploration in Alaska & Mexico
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the President and CEO of Millrock Resources live from the field, Mr. Greg Beischer. Greg, how are you?
Greg Beischer: I'm doing great Gerardo. Up here in Fairbanks, and everything's going great. Sorry if there's a little road noise, but I'm just in the vehicle traveling now to Treasure Creek project north of Fairbanks, where everything is in a full gear right now, after a bit of an orientation week last week with a crew that's going to be collecting a lot of soil samples. So, everything's moving full steam ahead.
Gerardo Del Real: I appreciate you taking the call on the road. Between Alaska and the news today out of Mexico, you have a lot on your plate right now. Let's get to today's news and talk about that a bit. You announced an agreement for the El Picacho Project in Sonora, Mexico. It's a gold project and I'd love for you to explain the thinking behind it, and how this fits with your project generator model. Right?
Greg Beischer: Sure thing, Gerardo. It's actually a great example of what can happen in the generator model. And I'll just give you the history on El Picacho. One of our geologists in Sonora used to work nearby at the San Francisco gold mine, which is about 15 kilometers away. He'd known about these prospects to the west of the mine and convinced me and the Board of Millrock to acquire claims over the property from local ranchers, Señors Suarez. Very nice people.
And we began exploring the claims and not long after that, we made an agreement with Centerra Gold. Big gold company, and they put in I think roughly a million dollars for us to do all the basic exploration work. Soil sampling, geophysical surveys, trenching and rock sampling. But ultimately, Centerra didn't drill a hole. And the holding costs was getting pretty expensive. And back in 2017, cash was very tight.
So we elected to drop our option to purchase the claims from the brothers Suarez. But we kept in good contact with them. Our team in Mexico kept in good contact. We helped them out a little bit with filling of some of their paperwork and whatnot. And now that things are picking up in the gold space, companies are really looking for quality exploration projects and along came a company called Tocvan. Approached us about Picacho. They, I think thought that we still had it under option. We didn't, but we were able to... because of our good relations, very quickly reinstate the option agreement. And then in turn assigned that option to Tocvan in return for royalty interests, which, Millrock's big on. We want to create cash flowing, royalty interests. And if we build up a big portfolio of those, that's really going to help the company.
And in this particular case, it's a 2% NSR royalty in the event that there's a mine built in production, Tocvan can buy back half of that royalty for $1 million. But importantly, for us, there's an advanced minimum royalty payment. That'll start after Tocvan has completed the purchase from Señors Suarez. So just a good example of how we've created ourselves, a potentially near term cashflow producing royalty, just by being diligent and keeping in good touch with our property holders. So I'm happy with this. I'm happy with our team for being diligent like that. And just another good example of what we're doing to create value for a Millrock shareholders.
Gerardo Del Real: You're on the road in Fairbanks, Alaska. I can't let you go without asking you about Alaska and how things are coming along there at the multiple projects. Right?
Greg Beischer: Yes, sir. It sure is. First of all, 64North, Resolution Minerals, the earning partner there, is all set up and ready to start drilling again. Imminently at this time, East Pogo Prospects, as the name implies on the East side of the Pogo mine, where last year our team in conjunction with theirs, discovered some pretty interesting high-grade gold targets. So there'll be drilling over the next month or so, and we'd anticipate results another month after that. Always exciting, and those drill holes that can result in the discovery that will make all the difference in the world for Millrock. In the interim, we ticked off a big team of people last week in Fairbanks. Got everybody tuned up on Millrock's policies, procedures, safety protocols. Make sure the whole team will be operating safely. The main thrust at first is to collect several thousand soil samples, in fact, to narrow in, on some of the target areas that we've identified. In the meantime, we continue to grow our land holdings in Fairbanks. We're more and more convinced with our partner, Felix, that Fairbanks has much, much more gold to find. Far more than the 16 million ounces that are being mined historically from placer deposits and at the giant Fort Knox gold mine operated by Kinross.
So lots of exciting things. Look forward to drilling late in the summer on some of the selected targets in Fairbanks. And that about wraps it up Geraldo. There's other things brewing in the background. Likely to be more funding partners coming in on other projects and announcements of new projects that we've acquired by staking or making deals. So we've got at this point just about every project in the portfolio partnered and active exploration and drilling, which again... Drilling is a thing that can result in the true discovery of a brand new deposit that will make a world of difference to Millrock's 10 cent share price.
Gerardo Del Real: I know the market is eager for a discovery. I think it will be well rewarded if it happens. And it sounds like there's going to be a lot of shots on goal in the second half of this year.
Greg Beischer: That's the size of it, Gerardo. Thanks very much.
Gerardo Del Real: Thanks again for your time, Greg drive safe.
Greg Beischer: Good. All the best. Bye.