General Precious Metals
Revival Gold (TSX-V: RVG)(OTC: RVLGF) CEO Hugh Agro on Game-Changing Drill Intercept from 3Moz Beartrack-Arnett Gold Project, Idaho
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president & CEO of Revival Gold — Mr. Hugh Agro. Hugh, how are you this morning?
Hugh Agro: I'm very good this morning, Gerardo, very good.
Gerardo Del Real: Listen, when we talk about drill results, when I speak with companies, we're usually talking about one of two things: it's either smoke or it's fire, right? You, sir, appear to have yourself a full-on blaze!
Let me read the headline here and provide some context. The headline reads:
Revival Gold intersects 12 grams per tonne (g/t) gold over 13.7 meters and 8.8 g/t gold over 11.8 meters.
And if that wasn't impressive enough, it's within 110 meters of 4.3 g/t gold at Beartrack-Arnett. More importantly, it was the final drill hole from the Joss target area. I'll let you provide the context but congratulations. Heck of an asset; heck of a release.
Hugh Agro: Congratulations to our team. Our exploration team has been working hard on the Joss area. And it's fitting that this is the last hole and the hole that leaves the deposit open to the south and also at-depth. It's very exciting for everybody, Gerardo, and I'm happy to share that with you and with your listeners. Very excited about it.
Gerardo Del Real: This is important because it's the highest grade gold intersection released from the Joss target area. And so intersecting the Panther Creek Shear Zone with these types of grades and widths is going to be really consequential for the potential economics given the fact that you have more than 5 km of strike with the Panther Creek Shear Zone. You have to be thrilled!
Hugh Agro: It's catalytic, Gerardo, because, as you point out, we've got a lot of potential for mill ounces at Beartrack but you need to reach a critical grade and a critical quantum. And clearly, we're doing that with this, and I think it tips the balance here in the favor of the mill project.
We have the first phase heap leach, and that'll produce about 70,000 ounces a year of gold from existing infrastructure. But the next phase is really exciting. And when you get these kinds of grades, these kinds of widths — a kilometer, three quarters of a mile of strike — this is pretty exciting stuff.
And it's the sort of thing that really causes large institutional investors and corporates to wake up and for investors, generally, that assign value to the two-thirds of our current resource which is in the mill category. And so it's catalytic is how I put it.
Gerardo Del Real: Phase-1 was already on-track to generate — roughly, give or take, and correct me if I'm wrong, Hugh — about US$50 million in free cash flow, right? Again, give or take, that was the Phase-1 plan, correct?
Hugh Agro: US$50 million per year, yes.
Gerardo Del Real: Correct, annually. Phase-2… now that we have what looks like the potential for bulk underground mining and milling at Beartrack-Arnett… brings into play a lot of the ounces that the critics of the resource had said, well, are they going to be able to recover it… is it going to be enough to justify a Phase-2 expansion?
This is a game-changing news release, Hugh, because this brings that into play, correct?
Hugh Agro: That's right. And in our current resource, the assumption is a 20,000-tonne-a-day mill. We have done two phases of met test-work on this material. We're getting 94% recovery — so it returns very well.
And at 20,000 tonnes a day — even at the open-pit grades in the indicated resource of a gram and a half — you're looking at something that would produce 300,000 ounces a year of gold. So it's a substantial amount of potential production from a facility scaled at that size. And that's just on the open-pit material.
So I think what we're looking at here is the possibility to scale the mill-build back, lower the capital costs on that phase of the project, boost the production from higher grade underground material — and we get a long life plus a 200,000oz/yr opportunity, which would generate multiples of free cash flow to what the first phase heap leach would do.
So this is all game-changing, catalytic, very important to the story. And remember, we're only a C$40 or C$50 million market cap company right now. So lots of upside in the stock.
Gerardo Del Real: A lot of runway there. Walk me through the continuity of the mineralized zone, the underground scenario, because that's critical as well, right?
Hugh Agro: It is. Eighteen drill holes to-date over that 1 km of strike. Those interested can visit our website and find the long section view in the press release. But the details are such that we've got enough spacing now that we can start to see how this would come together as a potential underground situation.
We're in an orogenic gold system. These systems are classically very deep, very large, and have consistent mineralization. And that's certainly what we're seeing. So the geo statistics in here are going to be very good.
We do have a lot more drilling to do to start putting this into mine plans and all of those good things. But in the first instance, what we want to see is these kinds of dimensions, this kind of consistency, and these kinds of grades. It's a game changer!
Gerardo Del Real: You have a 3 million gold ounce resource across all categories. It's headed to at least 5 million gold ounces, I believe. And mineralization is open at-depth everywhere, correct?
Hugh Agro: It is. It's open. And not just at Beartrack but at the satellite Haidee deposit. And not only is it open but we've got permits to be drilling these prospect areas, and we're building on our permitting to do even more next year. So this is… I don't know, Gerardo… it doesn't get much better than this.
Gerardo Del Real: It does not. I can't wait for the next round of drilling. Congratulations. Congratulations to the team! This is going to be one of the more exciting stories in 2022. And for anyone listening — and I don't do this often — what an opportunity at current levels. Hugh, anything else to add to that?
Hugh Agro: Well, just to thank you. I know that some of your listeners have been hanging in with Revival Gold here for a few years now, and you're starting to see the fruition of all the work and the energy.
The story is just getting better… operationally delivering on every account here. And with this latest drill hole, I think everybody can feel very confident that those mill ounces are economic and that we're going to build something that's very rewarding for shareholders.
Gerardo Del Real: I've got to believe mid-tiers and majors are likely dialing your number if they already haven't, Hugh. I will leave that there. Thank you so much for your time today.
Hugh Agro: Okay, thank you, Gerardo.
Gerardo Del Real: Chat soon. Alright, bye now.
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