Regulus Resources (TSX-V: REG)(OTC: RGLSF) CEO John Black on Social License and Drilling at AntaKori

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the CEO of Regulus Resources, Mr. John Black. John, it is great to have you back on. It's been a bit. It's also great to get some news on AntaKori. Congrats, I know there was a lot of hard work that went into the news yesterday. I'll let you provide the context, but the drill is turning, right?

John Black: Yeah. Great. Gerardo, thanks. It's great to talk with you and, and it's particularly exciting that after a period of work that we've gone through to make sure that everything is working well on the project, we're very pleased to announce that our drilling program is launched. It's important to note that when we talk about renewing our exploration activities on a project like AntaKori, it's not just our drilling program, it also means that we're able to do quite a bit of work to improve conditions in the communities that we live in and provide a lot of employment for the people in the area.

As a geologist, I'm excited to see the drilling get going again on this but I'm also very pleased that we're able to contribute to improvements in the communities and the areas that we're working in particularly coming out of the pandemic here.

Gerardo Del Real: We can talk about the project in just a second because it's an exciting project and I'm excited to see the drills turning and the assay results here in the next several months, but the work that you've been doing, it's been a quiet period as some people out there have noted, but it hasn't been a quiet period for lack of activity.

I understand that you've been improving access to clean drinking water, agricultural production, you mentioned the dairy industry in the release, which is big sector in the region. Can you speak to some of the efforts that you've been quietly but effectively executing on behind the scenes? I know there's a lot of companies that would have been press-releasing every one of these commitments that you've been able to follow through on. You did a phenomenal job of just getting the work done and now highlighting the fact that you developed that goodwill and that social license that's required for anywhere in the world if you're going to be successful. Right?

John Black: Absolutely. It's probably important to provide a little more context for those that might not be up to date with us on this. We initiated our drill program to extend our mineralization to the north. As you recall, we have a very sizable resource already on the project but it's very open to the north. We received permits about two years ago, just as COVID hit, to be able to drill to the north. We had to wait a little bit of time for COVID to settle down and develop protocols to be able to work. We initiated a drilling program about a year ago, October of last year, to start doing that work. Shortly after we started, we had to temporarily suspend that drilling. That was a result of a combination of factors. Primarily a group was making some false accusations that our work was causing some contamination of some local water bodies in the area.

We've addressed those with the help of the government water authorities to demonstrate that our exploration activity causes absolutely no impact on the environment or the water quality in the area we worked. But at the same time that that was happening, we entered into kind of a complicated political setting in Peru. With all of that going on, we felt it was best for us to take a period of time to really strengthen and extend our efforts to communicate the nature of the project to the communities around us. That's been done through a whole series of workshops, establishing a community information office in the local community centers, helping some of the local community members to strengthen their own political organization to be able to better express their interests on how they'd like to work with us as a company going forward.

We've all along been working on projects to improve conditions in the areas that we work in, but this has allowed us to reevaluate those and strengthen those and extend those. It's clear that we have a project that can as potentially become a mine in the future. So the type of things that we're working on are really centered on water and agriculture to start with. We're in an area that's agriculturally, not the area, the project itself, downstream from us there's a lot of agriculture, particularly centered on the dairy industry, Tubores, rather famous for their cheeses and dairy products, come from the area. So there's an opportunity for us to be able to work with communities to improve the quantities and quality of water that they have access to, that's always a concern.

That's something that we can help improve in the area. As we move forward, we can help improve with agricultural practices, basically strengthen their livelihoods, their way that they get benefits from agriculture. At the same time that we're advancing our project and understanding the potential for it to become a very large mine, we believe these are compatible and sustainable activities and we're doing a much better job of extending that communication to the communities around us. We're very excited about this opportunity. We think it's an outstanding opportunity for all stakeholders involved and we took a fair amount of time to establish that communication and that discussion with the communities. Now that we're comfortable that we're there, it's a great time for us to re-initiate our work.

Gerardo Del Real: Well done. Let's talk about where drilling has restarted, the Anta Norte target. I understand that the primary objective of the first hole is to test for extensions and in geometry, on hole 1,826, which returned 473.2 meters of 1.39% copper equivalent. Can you speak to that a bit in the approach to the drilling this to go around?

John Black: Yes, as we begin to drill the north, there a number of objectives we'll have and particularly when we're able to start with additional rigs here in the near future as well. But this first hole is really one that's designed to help us understand that really nice hit that we had in an AK26. You just mentioned the intervals that we had on that. So it's a long run mineralization in portions of it are quite high grade but we don't fully understand the geometry of that intercept right now.

This is a hole that's set up in almost a perpendicular angle to cross that. It'll provide us with information about the geometry of the mineralization. What are we looking at? Did we drill right down it with that first hole or do we have potential for this to be a significant zone?

The importance of us doing this is that that'll help us understand how we approach the drill out of this. What the orientation the hole should be. So this is an important hole for us to get that information to start with. It also has a hole that has pretty good potential to have good mineralization to kick off the re-initiation of the program with. Very tight hole for us to be drilling and I think we'll all be watching to see what comes out and what we can report sometime early next year.

Gerardo Del Real: Looking forward to it. I want to thank you for that update. Anything else to add to that? I do understand you're going to be adding a second rig in January. Is that accurate?

John Black: Yes. That's what it looks like. Everything's going well to get that rig started in early January. Then we'll probably drill with two rigs through most of the rainy season. We're just entering a rainy season here that extends to April. It's a period of time we can work but we generally work with a lower rig count in that period of time just to make sure that we have everything under control. We anticipate the program would ramp up beginning in about April or May of next year with additional rigs.

First assay we should be looking at sometime in February or March of next year, realistically, with the time it takes for assay turnaround right now. Watch for additional news coming out of the project as we'll be pretty excited to start reporting some of these activities we're taking to improve living conditions in the area and how we're working with the local communities. I think you'll see us begin to report quite a bit more about that as well. Watch out, it's a project that has tremendous potential. It's been quiet for about a year but we're getting everything started again and I think you'll see it's in the news quite a bit over the next few months.

Gerardo Del Real: I got to believe that your mining neighbors near and around you will be paying attention to those assays as I believe they are probably going to be needing some ore relatively soon. I'll leave that there and we'll catch up next time. John, thank you so much.

John Black: Great. Thank you very much, Gerardo. We'll be in touch.