General Precious Metals
Mawson Gold (TSX: MAW)(OTC: MWSNF) Executive Chairman Michael Hudson on Hitting More High-Grade Gold in Deepest Hole Yet at Sunday Creek, Australia
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the Executive Chairman of Mawson Gold, Mr. Michael Hudson. Mike, how are you today?
Michael Hudson: Very well. Thanks, Gerardo. Lovely to be back with you.
Gerardo Del Real: It's great to have you back on. You had some news last week that I reached out to you about. You just drilled 5.6 meters of 10 grams per tonne gold equivalent. It was the deepest hole at Sunday Creek, of course, in Victoria, Australia. The release as usual was well written. The release as usual provided some great context. I'll let you give us the audio version of the context in the release. Big step out on that Apollo structure, right?
Michael Hudson: It's looking very good Gerardo. You won't find many discoveries like this that have such a great hit rate with such high grades over meaningful widths. We've extended this structure down from surface right down through to over 400 meters now. This is one key shoot on this mineral field that now extends over 800 meters in multiple shoots. The Apollo, we've drilled down specifically to that 400 meters and remembering we've got 10 kilometers of strike extent of the old mining field that hasn't even enjoyed one drill hole.
So, it is very good. The most impressive thing I think, and one to really focus on, is the continuity. That's always the point. We always look for a system to continue to depth and, or to get bigger. That's what we're we are paid for as geologists. I think we demonstrated that in spades with some of the results over the last few months. But now with additional results, big step outs, 100 meter step outs still. We are becoming predictive.
So, pretty much from surface right down through, if your readers look at some of the diagrams, we're seeing 50 to a 100 gram meter width intersections continuously from surface down to 400 meters and without a miss. That's pretty impressive. Either we are very lucky or we absolutely know what we're doing. And I suspect, knowing our second guessing nature as a geologist, that there's a little bit of both involved.
Gerardo Del Real: Well, let's talk market cap and then we can pivot back to the multiple discoveries and already robust resource and system that you have within the company and the portfolio. Mawson now owns 84.62% of Southern Cross, which of course is the vehicle that will be holding the Australian assets that, look, you have a market cap just over $40 million Canadian. And I could make a pretty compelling case using comps, peer comps of exploration companies in the area with maybe not as great results. But much bigger market caps that the 84.62% of Southern Cross could be valued at a higher valuation than the entire market cap of Mawson Gold.
For those that are listening to this interview, or reading this interview, and are new to the story, and are excited about the price of gold in 2022 and beyond, can you provide a brief overview of the risk reward opportunity with Mawson Gold at these levels?
Michael Hudson: Well, it's always easier to market off a low base. Let's take the positive here. We were marketing a block of stock over the last year and that didn't move because the seller didn't want to sell in the end, but that was really what created an overhang on the stock. And Mawson stock has not yet recovered from that marketing exercise that didn't go ahead. The group that was looking to sell has never sold a share and doesn't want to sell. But the pity was we were just marketing a large block of stock. So that is why Mawson valuation essentially is where it is today.
Now the upside is, and starting from this low base, is that we have a million ounces at three grams, in Finland that will get bigger and is being drilled regionally now, looking to show that the system can get a lot bigger. But that asset is also going through permitting PEAs that will be out Q3 this year, just to show and demonstrate how good those ounces are. That's what the first stage economic study will show. So we've got a project heading towards mining in Finland, million ounces, and it's open in every direction.
That also comes with cash in the company combined with Southern Cross and Mawson of about between seven and eight Canadian. And then you have this Southern Cross spin out, which Mawson will own 58% of, on a 32 million Australian valuation if we raise 10 million at IPO. Now there's lots of numbers there, but essentially Mawson is staying and holding its majority interest for at least two years in Southern Cross. That value will be approximately 7 to 8 million Canadian, let's talk Canadian dollars. So 7 or 8 million cash, 7 to 8 million Canadian in potentially in this IPO which will happen over the next few months.
We're putting our prospectus in in the coming days, plus the million ounce pre-development project coming for what is just a shell pricing essentially. So whatever way you cut and dice that pie, Mawson is looking incredibly cheap. Mawson also has a new discovery in outcrop in the backyard of all of the mines in Sweden that we will drill over the next few months also. So it's not just limited to that one project. It's also got other projects in its backyard.
It is amazingly compelling. I wouldn't be surprised if Southern Cross starts to give Mawson a run for its money in terms of valuation if we continue to see good gold markets. It is going to be a really interesting next quarter on this reassessment that will have to take place by this look through value of Southern Cross assets in Australia, coming to market alone and Mawson being the major shareholder
Gerardo Del Real: Well said. What comes next? A lot of irons in the fire right now, obviously.
Michael Hudson: Well, we're still drilling in both jurisdictions. So in Australia, the drill rig is still turning. We looked to raise two million pre IPO funds for Southern Cross. Just the week before Christmas, we had 50% over subscription. So we took 2.7. That's allowed Southern Cross to continue drilling. We can't assay those holes while we're going through this prospectus, but they'll be banked up at the lab. So there'll be a huge news flow, come May, of drilling that has been ongoing in Australia.
In Finland, we're still drilling and looking to test a number of regional targets up there. And there's a five to six kilometer drill program ongoing as we speak. PEA as we mentioned, the first drilling into the Skelleftea, our Swedish assets will take place over the next few months also. There's lots of rigs turning in multiple jurisdictions, economic studies, and spin outs occurring with trading of Southern Cross expected in May. A hell of a lot to happen, Gerardo.
Gerardo Del Real: If you like gold, if you like gold exploration and development stories, it's getting really, really hard to not like Mawson Gold, especially at these levels. Mike, always a pleasure. Anything to add to that?
Michael Hudson: I think we've given everybody enough to ponder, Gerardo.
Gerardo Del Real: Excellent. Thank you for your time as always looking forward to having you and Ivan back on and we'll chat soon.
Michael Hudson: Thanks.Click here to see more from Mawson Gold Ltd.