General Precious Metals
Tim Smith of GoldMining Inc. (TSX: GOLD) and U.S. GoldMining Inc. on Advancing 32M Ounce Portfolio of Gold-Dominant Assets in a Rising Gold Market
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the new vice president of exploration for GoldMining and the chief executive officer of U.S. GoldMining — Mr. Tim Smith. Tim, it is a pleasure to have you on. First time on the show.
Tim Smith: Thanks very much, Gerardo. Yeah, appreciate the introduction there. Yep, first time. Excited to make the move to join GoldMining and U.S. Gold. Two weeks in and loving it!
Gerardo Del Real: Well, listen… let's get right into it. I am familiar with your background and it is extensive. You've worked looking for gold systems for over 25 years; you were vice president of exploration for Kaminak Gold; you led the team at the Coffee Gold Deposit in the Yukon. That was acquired, of course, for over half a billion dollars Canadian in 2016.
And then you also had a position with Newmont from 2019 to April the 22nd. So I want to get into your background and what it is about GoldMining and, of course, now U.S. GoldMining as well, that attracted you to lend your name to the company.
Tim Smith: Absolutely. Let me start with a little bit of history. As you mentioned there, most recently, I was with Newmont Gold for the last three years, and, prior to that, Goldcorp. So six years there with North American-based majors working primarily in North America, primarily Canada.
My role with Newmont was regional director of generative exploration. And what that really meant was that I was working outside of the mine sites contributing towards greenfields exploration but also some of the early-stage projects. That included continuing work with Coffee in Yukon and also, most recently, the acquisition of Tatogga, or Saddle, as Newmont has now renamed it, in the Golden Triangle.
Amazing experience working with both of those companies. Amazing people to work with. Incredible breadth of assets and geological style… so that really helped cement my North American credentials, I guess, in geology.
As you mentioned, before that, I landed in Canada in 2010 and got the job with Kaminak, their Coffee deal, up in the Yukon, and that was just an incredible ride. I'm thrilled that I was willing to pack up my family from Perth, Australia, at the time and move up to Vancouver to do that work.
Gerardo Del Real: That's excellent. The background and the history of success speaks for itself. Tell me why GoldMining and U.S. GoldMining? What is it about the profile that attracted you to lend your talents and your skillset to the companies?
Tim Smith: Yeah, absolutely. And as some of my colleagues have asked, why leave a safe job with a major? Well, the fundamentals with GoldMining and U.S. Gold are just fantastic. Such a large asset base: 16 million ounces in Indicated; 16 million ounces in Inferred; 11 major properties across five different countries, all within safe jurisdictions in the Americas. Just have so much respect for the portfolio that Amir and Garnet amassed over the last 10 years.
I like the assets and there's a tremendous amount of untapped potential there. And I like the strategy, too, that GoldMining has. They acquired these properties during the downturn; acquired them cheaply. Immediately, we're already seeing a big multiple in our current valuation and we see huge upside in increasing that. There's a lot of untapped potential. And we see a long bull market ahead for gold. We believe that these are assets that our peers in the industry will want to acquire.
And I think, thirdly there, I like the team. I worked with Alastair Still for five, six years… first at Goldcorp and then at Newmont before he came and joined GoldMining. Huge respect for Alastair… really like his style, really business savvy individual, great geologist. And as I already referenced, looking at what Amir and Garnet have done here… just excited to come and join the team.
And finally, my colleagues. What Amir and Alastair have done here in terms of putting together — quite recently, two of us have joined, myself and my colleague Eric Chen just joined this year, and last year, Sam Mah joined — there's a core group of technical expertise with a lot of experience.
So I'm really happy that we've got all of the bases covered from exploration to resource estimation to mine geology. And cumulatively there, we're somewhere in excess of 100 years’ experience.
Gerardo Del Real: You touched on something that I wanted to ask you about before I let you go. I have to ask you, being in the boardroom with Newmont looking at projects, advancing projects, you know better than most what a major looks for when it's looking to acquire a company or a deposit.
What is it that you think you bring to the table in terms of being able to recognize what a major wants? And then, of course, the followup question to that would be, what do you think the majors are looking for right now?
Tim Smith: Sure, and I started some of that work with Alastair, actually, so we've got a lot of internal experience within GoldMining in terms of what the majors were looking for. And Alastair and I were doing that together in Goldcorp between three and six years ago.
Look, you have to be living under a rock to not know that discoveries, globally, are not keeping pace with mine production… that reserve depletion is outstripping the pace of discovery. You just have to Google gold and reserve depletion or gold supply and demand to find all matter of articles on that… so no need to belabor that.
But if you look at the majors, there's Newmont there producing six to seven million ounces per annum; Barrick producing four to five. It's challenging to replace those sorts of reserves every year. And the assets are getting older, the assets are getting deeper. Exploration is going to play a part but acquisition is going to have to prop that up if they want to maintain or sustain their production profile.
And we believe that they're looking for development opportunities such as the assets that we have in GoldMining. These are advanced projects with resources, and some of them have preliminary economic assessments.
And that's part of our plan is essentially to build that up and deliver what they're looking for, which is a quality geological model that underpins a quality resource model and provides mining optionality. Mining and processing optionality; that's essentially what they're looking for and what we're getting prepared here to start churning out with these assets.
Gerardo Del Real: We both agree that the price of gold is likely headed much higher before it heads much lower. We're almost at $2,000 gold, and here is the US dollar index over $101. That, to me, is a really bullish sign. Let's hope that we're right about the price of gold going higher.
Do you see a rush of M&A in the gold space coming? Because you mentioned the depletion of reserves and you mentioned the lack of significant new gold discoveries and the inability to keep up with replacing those reserves. Do you see a rush of M&A coming?
Tim Smith: I don't know about a rush but certainly it's going to be sustained. We've seen some fairly recent activity…. some big announcements quite recently with Kinross acquiring Great Bear's Dixie Project, and, if we go back a year, Newmont acquiring GT Gold's Tatogga Project in the Golden Triangle.
We're going to see these development opportunities being acquired and the companies that own them. So that’s certainly going to be sustained. Whether there’s a rush to that… look, if gold cracks $2,000 and stays there, yeah, I think the fundamentals are strong for that.
Gerardo Del Real: Tim, great conversation. I'm looking forward to having future conversations. Congratulations on the positions and I look forward to having you back on. Is there anything else that you wanted to add to that?
Tim Smith: Just really excited to be here… looking forward to keeping you and your listeners updated, Gerardo. Thanks very much for your time today.
Gerardo Del Real: No, thank you for yours, Tim. Looking forward to it. Chat soon.
Tim Smith: Right on. Bye now.
Gerardo Del Real: Cheers.