Golden Arrow Resources (TSX-V: GRG) VP Brian McEwen on Having a Golden Tiger by the Tail in Paraguay

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the VP of exploration and development for Golden Arrow Resources, Mr. Brian McEwen. Brian, how are you?

Brian McEwen: I'm doing well, Gerardo. How about yourself?

Gerardo Del Real: I am well. I am well. Interesting times. We talked a bit off air. I want to get right into it. You had some news today that was interesting to me, and let me read the headline and then I'll let you provide some context. The headline reads, "Golden Arrow hits high-grade gold in shallow drilling and identifies new targets at the Tierra Dorada gold project in Paraguay." I would love some context. Because the way that I understand it, or the way that I read the release, there is a lot of soil and vegetation cover, which really made the exploration, I think you describe it as, challenging. And so the shallow drill program was a way to get a better peek at what was underneath. Is that accurate?

Brian McEwen: Yeah. That's very accurate, Gerardo. There's a lot packed into that headline. As you read it, I was thinking, "Wow, that's a lot to absorb." But the short answer is, yes. A bit more in depth, we've got this great project. We've got 64,000 hectares of property in Paraguay. We're pretty much the only one there that's looking around. We think we've got a tiger by the tail here with some district size deposits, some of the initial indications. The problem is, this is more of farmland than it is a mountainous terrain and stuff. So we've got a lot of soil, everything's covered. We're actually working around the farm animals and stuff. And we find boulders on surface and then we dig and we try to go after that. It's a very challenging work environment.

But what made it even more challenging this year was, with the COVID shutdown, we weren't able to go through our regular process whereby we would go in and do our soil sampling, and then we'd follow up with some trenching and then the geophysics and then we would get to the drilling. And we wanted to keep some sort of a news flow coming out to investors and potential investors, so we worked with the Paraguayan government and came up with different ways of doing it. And it actually was ended up being very successful in the end. Right before COVID hit, we had planned a big geophysics program. We'd moved all of the equipment into Asunción and it was ready to go to them. In March, everything shut down. And so all the equipment was there. We were itching to get going on it. And then because of social distancing, we weren't able to work in the field for several months. But we ended up being able to get a deal whereby we could drill shallow holes, maximum depth of 20 meters.

We could go out from the little trenches and see where we could get some continuity. And so it was hit and miss, but we hit more than we missed, which was very, very good. And then right at the end of the year, we said, "We really need to do this geophysics program." So we took our geophysicists from Argentina. They had to quarantine for two weeks before they could do the program, and we did the program. And what the geophysics showed, normally what you like to do is the geophysics first and then the drilling. But the geophysics ended up lining up with a lot of the drilling and showing us where we could go. And so that's why it was really important to get all this information into this press release, whereby we can say, "We took a shot at this and it worked and we got some good high-grade samples." And now with the geophysics, we've got some trends and some things to follow up on. So we're actually very excited about this and where it's going to lead us coming into this year.

Gerardo Del Real: You mentioned hitting more than you missed. And despite the fact that you essentially were drilling blind, it's 41 shallow diamond drill holes totaling 550 meters, you had some excellent results. You had a one intercept of 143.5 grams per tonne gold, over half a meter within a six meter intercept, that average 14.53 grams per tonne gold. You had another intercept of 11.8 grams per tonne gold, over 3.16 meters within 7.75 meters averaging 6.09 grams per tonne gold. So when you say you have potentially a tiger by the tail and a district scale package, I would love a little more insight as to how you prioritize. You mentioned the exploration work that was done. How soon do you get back out there, within the context-

Brian McEwen: We're out there right now. We're faced with some different challenges. Its really hot. Middle of the summer right now, and it's 45 degrees in Paraguay. But we have a hearty group. Oh, 45 degrees Celsius. Sorry about that. We have a plan there right now that we've applied now to be drilling some deeper holes. If we can't get the permits really quick to drill the deeper holes, we're going to drill some more of the shallow holes. We've got some indications from the geophysics that we're going to check out these trends. So we're going to start immediately doing some trenching along trend and see if we can expose more of the veins. The danger... It's always exciting to say, "We've got 143 grams," and all this, but if that 143 grams is just sitting there by itself and you can't show some continuity-

Gerardo Del Real: Yeah, it's worthless.

Brian McEwen: It really doesn't help out much. No, it is. It's great to put out big numbers, and I was criticized a bit for waiting so long for the geophysics, but we have to be able to show some continuity and direction, and we've got that now. So, like I say, I think we've got a very good program ahead to see what we've got there.

Gerardo Del Real: Excellent. And again, just a bit more context, you mentioned the 45 degrees Celsius. That's about 113 Fahrenheit for my US friends here. And so, yeah. It's hot as all heck, is what it sounds like.

Brian McEwen: Yeah, it is. It's hot. There are a few trees around some places. But no, that's the least of our worries. It's being able to work around the pandemic and we're following all the proper protocols. And things are going well, despite some of those challenges. And I think things are going to get much easier coming into this year.

Gerardo Del Real: You mentioned the permitting for the deeper holes. What is that process like? How is that, given the COVID backdrop? And then my follow up question to that would be, you mentioned this being essentially farmland. How are relations with the locals?

Brian McEwen: We've got a very good relationship with the surface owners and we've been working... They actually like the idea of us drilling, better than the trenching. Because the trenching, they were afraid of livestock stepping into the trenches and breaking legs and stuff. So we've actually got a smaller footprint. So we're working very well with them. They're happy about that. As far as the permitting process goes, we had a prospecting license before, prospecting exploration license, and that allowed to only drill shallow holes and so we were limited on how deep we could drill. And when we applied for that a year ago, we had no idea we were going to be facing this pandemic and the challenges that that faced.

So we managed to say, "We're going to drill these holes. They're going to be up to 20 meters." And we're pushing the limits in a lot of what we're supposed to do. And we've immediately gone back to them and said that our following permit that we want to do, we want to get into the deeper exploration. So we've applied, all the paperwork's in. We have a good relationship with the government, so I don't see any big problems there. But our plan is to have everything approved and be drilling before the end of the quarter.

Gerardo Del Real: Excellent. Excellent. Brian, I want to thank you for your time. And obviously I'm looking forward to having you back on, once that kicks off, to get a better idea of exactly what the approach will be and where you'll be drilling.

Brian McEwen: Gerardo, always a pleasure to talk to you. And yeah, stay tuned. We'll keep you updated.

Gerardo Del Real: Stay safe and stay cool.

Brian McEwen: Bye now.

Gerardo Del Real: All right. Thanks, Brian.

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