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Rockridge Resources (TSX-V: ROCK)(OTC: RRRLF) CEO Jonathan Wiesblatt on Drilling for a Significant Discovery at Knife Lake
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the CEO of Rockridge Resources, Mr. Jonathan Wiesblatt. Jonathan, it's great to have you back on. How have you been?
Jonathan Wiesblatt: You know what? I've been doing great, Gerardo. These are exciting time to be an executive of a very exciting resource exploration play here in Canada with almost entirely all of our exposure to the copper industry, so very, very exciting times. Thanks for having us back.
Gerardo Del Real: No, thank you for coming back on. Let's get right into it. There's a couple of things that are very clear to me, and obviously with your background, I'd love your take on the copper space, but I know what you're going to say. I think we share similar sentiments, but the one thing that's clear to me is that copper is likely headed much higher. Not that it needs to, these prices are robust.
But it looks to me like the demand part of the supply-demand profile is only going in one direction, and discoveries of significance are getting harder and harder to find. The other thing that's really clear to me is that the market isn't rewarding a lot of juniors, with the exception of discoveries. I love having you on, because you just closed a financing and you just announced a fully funded exploration and drill program that'll be upcoming at the Knife Lake Copper Project, which I think puts you in the sweet spot of what the market's rewarding. Can we get into that a bit?
Jonathan Wiesblatt: For sure. There was a bunch of things that you just mentioned, so let's unpack a little bit, let's talk about the macro for a second. Clearly, we are all of the understanding I think where the resource markets are, is that demand has recovered significantly since the beginning of the COVID pandemic. I think things are looking up for the entire resource commodity complex.
You can go from oil to copper to nickel to steel, the entire complex has improved. So demand, and even though I believe in that long 10-plus year tail for electric vehicles and battery metals and the industry, which will impact copper significantly on the demand side of things, looking very robust. I don't spend a lot of my time on the demand side, because I fully subscribe to that thesis. I think that we are headed in the right direction for a long period of time.
What's very interesting to me is how tight the supply markets are, and you nailed it. The new supply, new discoveries, new mines coming to production are very few and far between. There has been a significant lack of capital expenditures that have been put into the entire resource sector, including copper on a global scale for the last five plus years. We're starting to see the consequences of that now, and it happens in every cycle. This one is no different.
Now, when you layer in geopolitical issues, such as Russia and Ukraine, a part of the world that has a significant resource provider across many, many resources, including copper and other base metals. You start to really see the impact of significant supply shortages. When you have significant supply shortages and consistently rising demand, that's where you get an imbalance. You don't have equilibrium, and that's where you see price shocks.
We have seen the price of copper move from about two and a half dollars a pound from just a couple short years ago. We are now sitting here at $4.80 per pound, and the market continuously is getting tighter and tighter. I see a bias to the upside in the copper price.
With that being said, Rockridge Resources is in a sweet spot, like you mentioned, for those looking for a company in a safe operating jurisdiction with a good substantial resource. However, with significant and substantial exploration and blue sky upside. Let's just walk through that. We just completed a financing, which was well over subscribed of almost two and a half million dollars.
We did a hard transaction and flow through issued one common plus one warrant, and 100% of our proceeds are for exploration activities on our upcoming drill program at Knife Lake, so we're now fully funded. Last fall, we conducted a very comprehensive field program in the fall-winter, and that's in anticipation of what's going to be a 2022 summer drilling campaign.
The drilling is going to, again, target that Gilbert West and Gilbert South zones, where we had some very encouraging initial exploration success last year. If you recall, and if your listeners recall, the maiden Knife Lake deposit hosts upwards of 250 million pounds of copper equivalent at surface, a very good grade, in Saskatchewan, which is a province here in Canada.
The maiden deposit has been the focus of much of the exploration work, until last year where we conducted and completed a very exciting and encouraging regional exploration target program, which unearthed a bunch of very interesting anomalies, and some copper in and around the Knife Lake deposit, approximately five to six kilometers just west. That target area, that exploration target area, which has never historically really seen a lot of drilling up until last year will be the main in focus of our drill campaign in the summer.
Gerardo Del Real: For those that are not familiar with the type of deposit that the Knife Lake Copper Project is, I think it's important to explain why VMS systems lend themselves to multiple discoveries, not just one. Can you speak to that a bit?
Jonathan Wiesblatt: We believe that the Knife Lake deposit is one of several clusters. It's a remobilized, the VMS deposit, which is part of a much larger system. This is a very common occurrence in the Snow Lake camp, and some of the other camps located nearby, very, very common in this part of the world.
What happens with VMS-style deposits is that, typically, they don't show up as one-offs. They typically show up as clusters, and we think that the Knife Lake maiden in deposit is just one of many clusters in and around that area, at least that's what our technical team and geologists and exploration professionals, that's what they're suggesting to us. That's what we are relaying to the market.
It's very important for us to identify a lot of regional targets, which we believe that there are 11 of in and around Knife Lake, all with very high prospectivity to discover a new deposit. We think we're onto the right track with the Gilbert South and the Gilbert West location, which we will be going back to in the summer of this year.
Gerardo Del Real: You're fully financed for the exploration program. You're in the right jurisdiction. You have a mega trend in copper that I see shows no signs of slowing and drilling’s coming up. Where's the market cap?
Jonathan Wiesblatt: The market's just over $9 million Canadian. If you look like at an enterprise value per in situ resource calculation, we are sitting just above 3 cents per pound, copper equivalent, which is significantly below that of our publicly traded peers. Significantly below those, if you were to look at any market transactions, acquisitions, mergers, etc., in the marketplace. We are looking incredibly cheap on a number of different metrics, if you cut it up a bunch of different ways.
In addition to that, the market is paying a negative value for a very exciting gold property that we also have in Northern Ontario near the Timmins Gold Mining Camp. There is a ton of value inside Rockridge Resources. In my opinion, there is significant opportunities for shareholders to really capture that upside as we advance our exploration programs going forward.
Gerardo Del Real: A lot like in the real estate space, you make your money by buying right in this space. It's hard to buy wrong with all of the catalyst and the fundamentals already in place. A lot to like. Anything else to add to that, Jonathan?
Jonathan Wiesblatt: No, I think we nailed it, and it's just, again, it's a very exciting time to be a copper exploration story here in Canada. Looking forward to getting back up to Knife Lake, putting those holes in the ground and getting results out to the marketplace.
Gerardo Del Real: Looking forward to having you back on to speak to that. Thank you so much.
Jonathan Wiesblatt: Thanks, Gerardo.