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Mawson Gold (TSX: MAW)(OTC: MWSNF) CEO Ivan Fairhall on Commencing Maiden PEA on its Flagship Rajapalot Project
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the CEO of Mawson Gold, Mr. Ivan Fairhall. Ivan, how are you today?
Ivan Fairhall: I'm very good, Gerardo. Great to be here.
Gerardo Del Real: It's great to have you back on. I spoke with chairman, Michael Hudson, last week about how compelling Mawson was as a speculation right now with current prices. And we talked a bit about the weakness in the stock and why I see so much opportunity. You had some news today that I think further underscores the potential here. You're commencing a maiden PEA on the flagship. This is the project in Finland, right? A gold cobalt project. And I wanted to have you on to provide some context because Mike and I, Michael Hudson and I, last week spoke on the Australian assets and how I can make a pretty compelling case that Mawson's ownership in Southern Cross Gold, which is the vehicle where those Australian assets are held, could justify the current market cap of Mawson Gold. And that ignores the valuation that the flagship demands, which is a project that I think is right up your wheelhouse, right? You have a specialty and a knack in developing and optimizing quality projects. Why this project?
Ivan Fairhall: Yeah, look, thank you. Thank you for that introduction. And you're right, we have a lot going on in Mawson's portfolio, as you say, down in Australia, spinning out a vehicle, but it will be worth just at IPO, nearly half of Mawson's market cap and could easily become Mawson's market cap. And that ignores really Mawson's main business and our most valuable asset actually, which is the Rajapalot project. And so doing a PEA is really important for us. It's the first time that economics have been run over the project.
And as we all know, not all ounces are created equal, and we've got a million ounce resource, a million ounce gold cobalt resource up there in Finland, and that resource body has some really great fundamental qualities about it that I don't think people appreciate. And we need to do that PEA to just help people pull all those things together. And so some of those things that we're looking to really highlight as part of the PEA is excellent gold metallurgy. So we've got great recoveries, some of the best recoveries you'll see on a project at 95, 97, 98% cyanide soluble gold. So that's great recovery, using simple conventional low cost processing methods. You've got productive mining conditions.
A lot of people, I don't think, realize that the Rajapalot resource bodies range between five and 30 meters thick. So these are not narrow vein deposits where you've got to mine a lot of dilution, and you do a lot of development per tonne of resource that you get. And so it's going to be amenable to bulk underground mining using something like underhand cut and fill.
And so that means low cost and high extraction ratios. And of course, I mean the main thing that overhangs all of this is access to infrastructure and the location of the project. We're 30 minutes from the capital of Lapland international airport, city of 65,000 people. So you've got infrastructure skills and that helps keep the capital and the operating costs down for the project, and grid power running right by the project. So, that's access to renewable power as well, given where it is in the world. So, as I said, the PEA is just an important opportunity to bring all of these ideas together and present them in a coherent business case.
Gerardo Del Real: You mentioned not all ounces being created equal. Not all consulting groups for a PEA are created equal either. And I know SRK Consulting to be very conservative and very rigorous and methodical in how they view and qualify and quantify PEAs. Can you speak to why SRK Consulting, and just maybe provide a bit of background, because I think, there's different ways to initiate a maiden PEA study? And there's some groups that tend to be a little more friendly to companies that reach out. My experience with several different investments where SRK has come in, is that they're a conservative group, and they're a trustworthy group that's extremely qualified, and lends credibility to the PEA when those numbers come out.
Ivan Fairhall: Absolutely. I'm glad you brought that up because people will recognize, and you've picked up on SRK, and as well, also Paterson & Cooke and Wardell Armstrong. These are some of the best people in their fields, and I'm an engineer by background. I've done this kind of work my entire life, both on the engineering side and as an investor, investing into these development stage assets and really having a massive stake in how well those companies perform. And I see using groups like SRK as an investment in quality, because the PEA for us, is the base building blocks of a project. And we're going to take this on, and we're going to continue that work through the latter stages. And we want to get it right. And this is not a means to an end, which is how some other companies approach their PEA. This is the start of the journey, and using quality consultants, as I say, is an investment in the project. And I think it shows a little bit about what we think about the quality of the project. It actually deserves quality consultants to be working on it.
Gerardo Del Real: Very well said. What can we look forward to in terms of timeline, the third quarter? Is that accurate?
Ivan Fairhall: Yep. Third quarter this year. That's the plan.
Gerardo Del Real: Wonderful. Ivan, great to have you back on. Anything else you'd like to add?
Ivan Fairhall: No, I just think, this is a really interesting time in Mawson's development. We've got the IPO of Southern Cross Gold happening in about six weeks time. As I said at the start, that's going to be worth almost half of Mawson's market cap. We're drilling Finland at the moment. We'll be drilling our first drill ever to go into our project in Sweden, in the second quarter. We'll have PEA coming out in the third quarter, the IPO happening, and we'll see what happens after that. So there's just a ton of value catalysts coming down, and we're funded to get ourselves through all of those. And so it's an exciting time to be taking a look at Mawson.
Gerardo Del Real: A lot to like. Thanks for your time, Ivan. Appreciate it.
Ivan Fairhall: Thanks a lot, Gerardo.