General Precious Metals
Goldshore Resources Inc. (TSX-V: GSHR)(OTC: GSHRF) CEO Brett Richards on Advancing a 4 Million-plus Gold Resource in Ontario, Canada, by way of the Drill-Bit
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president & CEO of Goldshore Resources — Mr. Brett Richards. Brett, it's been a bit. It's great to have you back on. How are you today?
Brett Richards: I'm great, Gerardo. How are you doing?
Gerardo Del Real: I am well. We chatted briefly at a recent investment conference, and you and I had had conversations earlier in the year where you and the team were very, very enthusiastic about putting out a resource estimate later in the year.
And it was one that you thought would be significant, and it was one that you told me you thought would capture the attention of mid-tiers and majors alike. That news was delivered in mid-November, and so I wanted to make sure to have you back on.
I want to start by congratulating you because it's a pretty robust resource. I would love for you to provide the context of that resource.
Brett Richards: Absolutely, Gerardo. Yeah, we were excited. On November 15th, we put out a current resource estimate for just Moss Lake. And I think if people go back, they'll remember we acquired the Moss Lake Project from Wesdome Gold Mines eighteen months ago. We've been drilling ever since.
We've got 75,000 meters drilled to kind of verify what our thesis was at the beginning because when you have a historic resource, you start from zero. It's guiding you but you can't build on that. You’re really starting over.
So we put out a resource; 4.17 million ounces at 1.1 grams [per tonne gold] at Moss Lake only. We increased the tonnage by 33%. We increased the ounces by 33%. So that was very key. The East Cold Stream historic resource still remains. We've done some drilling up there. We've still got 850,000 ounces at 0.8 grams. That's a 5 million ounce package. But the story here is about the high grade.
We have high-grade shear domains contained within the Inferred resource of 4 million ounces. We have 2.2 million ounces at 2.0 grams, and these high-grade shears cut right through the center of Moss Lake.
And that’s why we're excited. And when we were talking at the conference, I said, ‘Gerardo, this is 3.5 km long! We're at a 35-km-long mineralized trend. And we have drilling to support that Moss Lake is 8 or 9 kilometers long. We can support that with drilling but we can't bring it in until we do some infill drilling.’
So there’s a long way to go. But man, this is one exciting big project!
Gerardo Del Real: As exciting as it is to have the 4.17 million ounces of gold, and then for you to have an opportunity for a high-grade open-pittable gold resource… let me tell you what I really like because I tend to lean towards the exploration side of things.
And in my personal speculating habits, it really excites me that this resource doesn't include 52 holes because the assays hadn't been received at the time that this estimate was published.
The other thing that really excites me is you have an additional 29 targets over a 35 km trend. Can you speak a bit to the exploration upside and how you plan on unlocking the value there because you're clearly going to have to prioritize these targets moving forward.
Brett Richards: Absolutely, and we're spoiled-for-choice as my friend Pete Lindell, our VP of exploration, likes to say. What we have found now is that we have critical mass at Moss Lake. We have current critical mass, and that 4.17 million ounces is going to grow significantly when we do another mineral resource update at the end of Q1.
We are probably going to include more than those 52 holes that didn't report in, and that's just waiting for assays at the end of the day. But the exciting thing is, yes, we're going to grow the global resource significantly but we're also going to grow the high-grade.
And we think if we can get the high-grade up to, say, 3 million ounces at two grams, then that will be the basis for us to start a PEA. And that PEA will run until probably the end of Q2 2023 — probably run a few months.
But I think that the project contained within Moss Lake is going to be a winner. And the reason I think it's going to be a winner is because of the grade. When you have any project that has two grams open-pit in Ontario or Quebec, Canada, generally, you're going to lead your pack.
If you look at our peer group, some of the highest grade mines who are getting C$70 and C$80 valuations per ounce are at 1.8, 1.72, 1.65 g/t Au. We're at 2.0 g/t Au. So when you do the PEA, it's going to bring those great economics to the forefront in early cash flows, which are going to make the economics of a project so great.
And when we're talking about capex, we're trying to make this ‘compartmental-size’ of a project that the market can digest; a C$200 million to C$300 million capex project. I wouldn't want to go to the C$8-C$9 billion size project because we've seen the market and that's not what they want.
They want something manageable with a good production profile; 120K to 130K ounces per year for 10 or 12 years, generating over a hundred million dollars of free cash flow a year. That kind of project will get the market excited, and that's what we're going to deliver in the coming year.
And when we get there, that will be the basis of how I think we could potentially fund ourselves going forward. You have a hundred million of funding a year; when we get there, that's the basis for looking at all of these other targets you talked about.
Yes, the expansion of Moss Lake along 8 or 9 km of known mineralization, that's a generational-size mine for us. Probably a Phase-2 where we can take Phase-1 and scale it up in Phase-2. Hamlin… Iris Lake… Vanguard… East Cold Stream… we haven't even talked about bringing that into the fold, kind of sequencing that into either a mine plan at Moss Lake or some sort of standalone. It's only 11 km away; you can certainly truck the ore… and so all of that has to be well understood.
And then, North Cold Stream — and this is something completely different — we put out a press release earlier this year, about a month and a half ago, at North Cold Stream where we have 62.8 meters at 0.88% copper with 0.09% cobalt in there. So now we have this EV, this battery mineral type deposit on our property. We have a couple of these VMS deposits that are quite large.
This used to be North Hollister; used to be a copper-gold mine. And is it possible that we can do something with that? Sure, maybe put it into a separate company; SpinCo it into ‘Coppershore Resources’ to the benefit of Goldshore Resources and raise some money to prioritize drilling.
As to your point earlier, Gerardo, there's only so much capital, and we have to prioritize those 29 targets to bring projects into cash flow as soon as possible. So we're focusing on Moss Lake. We will get to Cold Stream, and we have East Cold Stream, and we'll do something with North Cold Stream in due time. And I don't have an answer for that yet. But watch the space next year.
Gerardo Del Real: You have the ounces, you have the grade, you have the exploration upside. I also think that your timing is phenomenal as I believe that 2023 is going to be a spectacular year for our favorite yellow metal.
Brett, it was great to have you back on. Great to catch back up. I'm looking forward to doing it more often. Anything you'd like to add to that?
Brett Richards: No, Gerardo. I look forward to updating everybody in Q1 as to where we are… but watch the space. This is going to be an exciting project.
And as we start to see gold recover and stabilize in this big macro environment that we've been dealing with for 10 months now, you're going to see gold strengthen and you're going to see gold equities really start to leverage against the rest of the market.
So watch the space and watch GSHR on the ticker.
Gerardo Del Real: Couldn't agree with you more! Thanks again, Brett.
Brett Richards: Take care, Gerardo.