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Mawson Gold (TSX: MAW)(OTC: MWSNF) CEO Ivan Fairhall on Southern Cross ASX Listing, Million Ounce Eq Gold Resource & Drilling at Multiple Projects This Year
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. Very good, and great to be back on the show.
Gerardo Del Real: It's great to have you back on. Interesting markets, interesting times, not just in the resource space, in the broader indices, in the bond market. I've always said that in times of volatility, the better management teams find a way to continue to add value, because eventually we all know we're going to get that turn and that pivot where gold starts to outperform other asset classes, and companies that have robust resources in place along with pretty exceptional exploration upside, are going to do really, really well. And I think those companies will outperform. I say all that to say that Mawson Gold is doing a lot of great work that the market isn't rewarding right now. And I wanted to touch on some of that work. You just had the very successful listing of Southern Cross Gold, which is of course a subsidiary of Mawson Gold. And it was interesting to me the valuation that it garnered because I think it speaks to how undervalued some of Mawson's flagship assets are. And so I wanted to give you an opportunity to speak to that a bit and give us an update on everything that's going on.
Ivan Fairhall: Yeah, sure. Thank you for that introduction. And I certainly agree with you and we are a company, despite the market's being kind of wild, but, I think the first thing is to remind people that the success of this Southern Cross IPO is really important. The portfolio of assets and gold in Southern Cross is our Australian portfolio of assets down in the Victorian goldfields. Victoria's one of the world's premier goldfields. It's produced over 80 million ounces and it hosts Fosterville, the world's highest grade goldmine. So it's a pretty hot jurisdiction. Fosterville has obviously had that great success with the Swan zone and it's the 10th largest goldmine in the world. And so, a hot jurisdiction, and we've got some of the best property down there. And the explorers in that region down in Australia are getting a lot of attention.
And so pretty clearly I think today's events, or events of the last few days have shown we're not really receiving value for those assets in Mawson. And down in Australia, being able to raise another $9 million, it brings the total raise down there to $11 million, so we are a majority shareholder in that company and their cash box is full, full, full. And so they've got plenty of cash now to go on and explore, and those shares are trading on the ASX, and so there's a market down there for those shares. We were able to raise capital and created $17 million of value for Mawson. So that's the value of our stake in Southern Cross, $17 million. And that's nearly half of Mawson's market cap, which is phenomenal, really. It's crazy if you think about it. And so it is a great result for Mawson shareholders.
I don't think they were being rewarded for our successes down in Victoria. And now we've created a platform with a dedicated strategy, a management team, but most importantly, I think, the investor base in the logical home for those assets on the ASX, to really just continue to drive that forward and they've got the cash and we can sit back knowing that other people are doing the hard work for us.
Gerardo Del Real: You have a million ounce gold equivalent inferred resource in Finland that is getting a next to nothing valuation. I think the re-rating opportunity when the gold sector turns during the next leg higher is going to be pretty exceptional, as I mentioned up top. Can you remind people please, that that million ounce gold equivalent resource is just the tip of the iceberg? Because as I mentioned, the exploration upside is pretty substantial here.
Ivan Fairhall: Yes, sure, absolutely. I couldn't agree more. It's funny, the success of the IPO, the better that Southern Cross does, and the more value that you can see in Mawson shareholders that can be attributed directly to shares that we own in Southern Cross, the current share price that Mawson is trading at and Rajapalot I should say, is trading at. And that really shines a light on that value. The ounces that we have, I think today are trading at something like $12 on an EV basis. So $12 per ounce, and that's right at the bottom of the peer group. And we don't have just a historic resource. If you look at that peer group, there's lots of different groups in there, historic resources, low grade projects that are tired and not moving forward.
We've got a resource that's a pretty new discovery. I think we had no resource in 2018. We now have a million ounces. We're pushing it forward with a PEA, and actually looking to jump into that developer peer space, where we can have an MPV on the project. And this will show us hopefully trading at a very steep discount. But coming back to the exploration, which was your point, exploration opportunity in Finland is still huge. Success is being made everywhere in the country, and we've got a huge land package, 18,000 hectares. And 90% of it is completely untested by drilling. We've got a million ounces on one edge of our property. We've got six meters at 617 grams a tonne over on the western edge of the property, practically zero drilling in between it.
We did a little bit of drilling this year around the existing resources, and we were hoping to find a repeat close to the mine. And it's just an area where we had a lot of data and access at the time. And we didn't find what we were looking for there. But the down dip ore body extensions, we've got 31 meters at five grams a tonne in South Palokas, at the bottom of that ore body, completely open below. All of the ore bodies that make up our inferred resource are open at depth. And so you've got exploration growth there, right in the mine, I would say. And then a very large land package that we're going to look over the next period to unlock new areas that are prospective and have never seen a drill hole.
Gerardo Del Real: Excellent. Well said. A lot to look forward to. Anything else to add to that, Ivan.
Ivan Fairhall: Well, yeah, like the infomercial, but wait, there's more. There's one more thing and it's happening right now. So, Skelleftea is the project we acquired in Sweden, an option over that project up to 85%, down in Sweden. It's four hours down the road, and we're drilling that right now. The drill rigs are turning. That project is in the shadow of the head frame. 6 million ounces have come out within 20 kilometers of that property. It's just down the road. It's got outcropping gold, quite like what we saw at Rajapalot. And I think we've shown, we've got the team to make discoveries and create value just like we did at Rajapalot, just like we did in Victoria, and we can show that we can make the discoveries and move them forward.
Gerardo Del Real: Exploration upside, exploration upside, gold resource, multiple jurisdictions, stable jurisdictions and anchored by a $17.2 million market cap in the Australian assets, in market capitalization. So a lot to like, a lot of value. I know the market seems to yawn at everything right now in the gold space, and understandably so with the volatility going on throughout many sectors. But again, when it turns, it turns pretty quickly and I am looking forward to the re-rating. I think it's going to be pretty exceptional. Ivan, thank you as always for the update today. I appreciate your time.
Ivan Fairhall: Thank you, Gerardo. Great to be on.
Gerardo Del Real: All right. Chat soon.