Categories: Precious Metals
Topics: General Precious Metals / Gold Stocks

Renowned Economic Geologist Brent Cook on the 2025 Metals Bull Market, Headwater Gold, and Much More

 

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is somebody that I've looked up to for quite some time and somebody that really doesn't need an introduction — but I'm going to introduce him anyway — Mr. Brent Cook who, of course, is a renowned exploration analyst and renowned economic geologist. 

I could go on and on about all of his titles. He has over four decades of experience. Not to date you there, Brent, but look, I’m excited to have you on the show. How the heck are you, sir?

Brent Cook: I’m doing well, Gerardo. The gold-silver market seems to be picking up, and copper looks good. In terms of the metals, we're looking good.

Gerardo Del Real: Let's start there with the metals. I've had the pleasure of interviewing quite a few people here over the past couple of weeks, and look, we're in an environment that we've never seen before, but that we all, I don't want to say predicted, but we planned for — at least allocated for. 

Seeing it is a different thing. Where do you feel we are in the cycle as it relates to the metals? And then, I want to talk about the junior resource sector, obviously.

Brent Cook: With that caveat, I’d say we're probably halfway to two-thirds of the way into this bull market. There's so much going on geopolitically that it's a tough call to know what's going to happen to the global economy and such… but certainly there's a deficit of copper building.

Gerardo Del Real: Absolutely.

Brent Cook: Gold is being acquired by central banks around the world. The dollar is being tossed out the window, and we're mining more copper, gold, nickel, etc. than we're finding… so there is a deficit looming out there. And I think that bodes well for quality projects that larger mining companies will be acquiring and, as well, quality exploration companies that are looking for legitimate projects.

Gerardo Del Real: Do you think that those companies that make discoveries of significance are going to capture premiums that we haven't seen, because of the margins, with potentially $3,500/oz gold, with $36/oz silver (which is likely headed higher) and with copper that looks like it wants to head to record highs with those structural deficits?

Brent Cook: Most definitely. In a way, the market is similar to what happened in around 2000 when the China thing happened, and that took everything up and everyone got aggressive. This time it's not the China thing — it's more the electric build-out and problems with the US dollar and that sort of thing. That's what's going to push it.

Gerardo Del Real: I mentioned during the introduction that I've looked up to you for a long time. And a part of that is because you don't impress easily with the companies. I've seen you speak at conferences at least fifteen times, and you always highlight more things that you don't like about companies than things that you do like about companies. 

I know your background with precious metal epithermal systems, and I saw you in New Orleans a year or two ago, and you had joined the technical advisory team for a young company called Headwater Gold (CSE: HWG)(OTC: HWAUF) that specifically is mandated internally to look in the western United States in top-notch jurisdictions for epithermal systems that can be quite high grade and quite rich in nature.

You don't take a lot of those technical advisory roles on… so what attracted you to Headwater Gold to make you say, ‘Yeah, I'll put my name on that, and I want to work with that team because I think there's something there.’ It's just not something you do very often.

Brent Cook: No, I don't do that very often. I went on a field visit with them and looked at a number of their projects throughout Nevada and got a good feel for Caleb Stroup, the president, and his geologic team, and they were doing exploration right. They're not looking for old retreads and trying to pump up the stock based on that sort of thing. 

They're doing real grassroots exploration — looking for targets that are blind from surface, basically, based on what little outcropping, geology, alteration, geochemistry they can pick up. But they also understand the business side of it. 

We know that most of the prospects out there anyone turns up are going to come up dead. So rather than diluting themselves, the share structure continually, basically proving there isn't a deposit somewhere, they recognized that it was better economics to bring in a partner to do the hard work. And so I liked that model for the most part.

And the other thing about that model that's really worked for me is these guys — the style of company as a prospect generator model, the smart ones — keep turning through projects and projects, and they bring in companies and partners. But eventually, at some point in the future, they come across something that keeps getting better and better, and they keep it.

And when they keep it, you've got a low share count, tight share structure, and you can really do well with a legitimate discovery. Otherwise, you've got other people spending money on your project. And if it goes good, you still profit from that — or benefit from that — from the share structure. 

So I guess that's what got me into it, and I should say, after I went and visited the project, I bought some shares and I came on as a technical advisor.

Gerardo Del Real: I love Headwater’s model. I've been critical of the project generator model because it gives away the bulk of the upside on the exploration front. What Headwater has done, and I think, brilliantly, has been able to, on the project generator side, get over C$100 million in potential exploration commitments from the likes of Newmont, and then simultaneously retain some of the juicier projects with 100% ownership that they can test for themselves. 

And I think the combination of that in this environment — with $3,500 gold and likely headed higher — is pretty unique, especially with the geopolitical turbulence that we have right now. 

You touched on that earlier, and I think being in the western United States — the US has a lot of other issues going on — but exploration in the western US, I think, is prudent. 

And going back to those premiums I talked about earlier, I think if they make discoveries of significance, shareholders are going to be pretty richly rewarded. Not a coincidence that management and insiders own some 30% of shares outstanding. You’ve talked about skin in the game.

Brent Cook: Right. The gameplan is still to bring in partners unless they see something that is so good that they continue drilling it themselves. Look at drilling costs in the western US. Core drilling is running between $500 and $600 a meter all-in. 

So consider your target is probably 250 meters below the surface. You can pre-collar it with RC, and that's running about $200 per meter. But still, to drill 10 holes testing a target, that's going to cost you around $70,000 — and that's going to go pretty quick.

Gerardo Del Real: And most of the time you're going to miss.

Brent Cook: And most of the time you're going to fail. Or you'll come up with encouraging results, which is the last thing you want because you’ll likely have to raise money on a dead share price. So my sense is, and I don't know for certain, but I know they're talking to a lot of other companies, trying to bring in partners. And I think — given the gold price and the prospectivity of the western US — they'll succeed.

Gerardo Del Real: Obviously, with Headwater, on my end, I’m biased. The company is a client of Resource Stock Digest. They're a client for a reason. I think our audience has a really good chance of making some money with the team. 

On your end of it, you're a technical advisor. But what else do you like out there that maybe is off the beaten path or isn't the flavor of the month? As you know, our industry tends to have flavors of the month almost every month. We hear the same names getting tossed around sometimes. Is there something that you really like that you don't think a lot of people are paying attention to that you care to share with us today?

Brent Cook: Well, the one thing I have done over the past year, year and a half, is I have bought into legitimate discoveries, and the share prices and market caps have done well. But I think there's such a limited number of real deposits that a major is going to want to buy, that there's still upside left in something like a Southern Cross Gold Consolidated (TSX-V: SXGC) with their Sunday Creek discovery down in Victoria, Australia. 

Gerardo Del Real: Absolutely.

Brent Cook: Yeah, that thing just keeps getting better. Another one in Finland is Rupert Resources (TSX: RUP). That is probably the nicest open-pit, undeveloped deposit I'm aware of held by a junior. So those are two I like and I own. And I'm also keen on rare earths.

Gerardo Del Real: Interesting.

Brent Cook: I own a company called Aclara Resources (TSX: ARA), which has a clay rare earths deposit down in Brazil that's being advanced really well. And they're connecting with US production, US processing, so that can come in and not have anything to do with the Chinese rare earths. So that's another one I like.

Gerardo Del Real: Interesting. Brent, it’s always fascinating chatting with you. I'm really excited to see what Headwater Gold is able to do here as far as continued joint ventures. 

I’m obviously excited about the prospect for $3,500/oz gold with the caveat, of course, that it comes with a lot of turbulence. Yet, that's just par for the course for the gold price and where we are in the state of the world right now. 

Any places you're appearing here soon? I know Rick Rule, who I had the pleasure of interviewing a couple of weeks ago, has his Natural Resource Investment Symposium on July 7-11. Will you be there?

Brent Cook: That's right. I'll be there. I'm speaking and I'm on a panel, and my partner and the owner of the Exploration Insights newsletter, Joe Mazumdar, will be there and he's speaking as well. 

And if your audience hasn't been to Exploration Insights, they should. Joe is the best junior mining analyst out there, so check it out. I'm also going to the New Orleans Investment Conference in November.

Gerardo Del Real: Excellent.

Brent Cook: And I'll be at Beaver Creek Precious Metals Summit in September.

Gerardo Del Real: Wonderful. I'll see you at least two out of three of those — Beaver Creek and New Orleans for sure, and then, quite possibly, pending resolving a scheduling conflict, the symposium with Mr. Rick Rule. 

And to your point on Joe Mazumdar, we had him on a couple of weeks ago, and I couldn't agree more about how spectacular he is. He's someone, obviously, who took over your business and then started to quarterback it some years ago and has done a brilliant job with it. 

So I tell everybody… I love the high-risk, high-reward stuff. If you want the technical side of it and a very thorough, detailed breakdown of why he does what he does, Exploration Insights is a phenomenal service — and one of the most honest ones in the business. Great stuff as always, Brent.

Brent Cook: Alright, have a good week Gerardo… and hopefully we'll see you in Boca Raton for Rick’s symposium.

Gerardo Del Real: Knock on wood. Thank you, Brent. Appreciate you.

Brent Cook: Alright, cheers.

Gerardo Del Real: Cheers. 

 

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