Categories: Precious Metals
Topics: Gold Stocks

Valkea Resources (TSX-V: OZ)(OTC: OZBKF) CEO Thomas Credland on Rupert Buyout & Positioning Valkea for Another Win

 

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is, on a transformational day, I think, for Finland, right, is the CEO of Valkea Resources (TSX-V: OZ)(OTC: OZBKF), Mr. Thomas Credland. Thomas, great to have you back on. How are you today?

Thomas Credland: Great to be here. It's been a long journey with you in Finland, all the way from discovery, to sort of this exit by Rupert and that was announced yesterday, so yeah, it's very exciting times in Finland.

Gerardo Del Real: No. Listen, let's talk about what that means for Valkea. Obviously, you were instrumental in leading the charge over at Rupert. Did that methodically, did it obviously very successfully. How does Agnico coming in and writing the kind of checks that it's writing change the approach or enhance the approach for Valkea moving forward?

Thomas Credland: Well, I think the first thing is, quite apart from the headline numbers, the composite transaction size of $2.7 billion US, the other thing, the other takeaway from yesterday's release were the commitment to spend $100 million on exploration of the district as well. So I think that puts Finland back on the map as a sort of exploration destination. It shows this sort of potential Agnico sees in the area.

If you just look at the headline numbers, they were paying $690 a resource ounce, which is kind of expensive, unless you believe that there's probably generations of exploration and resources to be found there. I mean, I think the original finding costs for the Ikkari ounces is about $11 to get to the PEA level. So an indicated resource. So that's a huge uplift, from 11 to sort of $600 a resource. So I mean, it shows what's possible in Finland.

Gerardo Del Real: Look, with that checkbook, with that balance sheet, Agnico could have gone anywhere in the world. Why do you think now Agnico decided to go into Finland in such an aggressive manner?

Thomas Credland: Well, I think I look at Finland and it's one of the areas that sort of slightly lagged behind some of the other big districts like the Abitibi and Nunavut and West Africa. I mean, I think those are areas where Agnico's been a lot more experienced and probably been there a little bit longer, some of them. But I think when I look at the investments in grassroots exploration in Finland, it's still relatively under explored. I mean, since we discovered Ikkari, I think year-on-year, we've seen a decline in grassroots exploration.

So maybe whilst the rest of the world is picking up the sort of exploration in some of these other districts, I think Finland has probably lagged behind a little bit. And part of that has really been because the land has been held, it's been held in multiple different parties. You haven't seen maybe some of the big exploration campaigns you've seen in other districts. So I think this kind of consolidation is excellent for Finland, and it leaves Valkea as the second-biggest holder of ground and the only independent in the area. So we have 350 square kilometers of ground, which is very prospective, which was pegged probably before some of the Rupert ground and some of these other entrants. So it's very good ground that's sitting in Valkea, but they've been relative to the rest of the world, I think the activity levels have been quite low.

Gerardo Del Real: The recent transition and board changes to Valkea obviously are designed to make it a more efficient, locally run operation. Can you speak to those?

Thomas Credland: Yeah. I think that there's obviously challenges with running a sort of a Finnish enterprise from North America, but what I'm intending to put together is a very similar management team and approach that we had at Rupert at the beginning. So very lean, European-based and experienced in Finland and specifically Central Lapland, which is where all the big deposits are. So again, it's really applying that lean and sort of methodical approach to be, we used Rupert to make the Ikkari discovery. So it'll be a very, very similar approach to the one that we tried there.

I think the previous management team have left the sort of capital structure in a very good shape and they've put together this fantastic package of properties and now it's just getting a sort of tried and tested team on the ground and working these targets.

So I think when I look at it, there's probably ... We'll do what we did at Rupert, which is to put together a long list of exploration targets on our five properties. We start with a long list and then winnow those down to the best five to ten which we'll be drilling from the second half of this year. So again, it's the same methodical approach, sheer science-led, and just sort of we're going to work through our sort of target list until we find something that's of significant size. So we're not going to get stuck on small things.

If I look back at the learning with Rupert and Ikkari, Ikkari was the sixth target that we drilled, our sixth discovery. So you just need to keep cycling through grounds and targets until you find something that's really big and really significant.

Gerardo Del Real: Well, you didn't have 47 or $4,800 gold when you got going with Rupert. You do now. And it looks like it's got legs and it looks like the price is going to continue to run as currency debasement around the world continues to accelerate. I'm excited to see you work with the land package that you have and can't wait to get details on the targeting and the drill campaign later this year. Anything to add to that?

Thomas Credland: Yeah, I'll just go through some of those timings. I think when we first went into Lapland, I think gold is at $1,200 an ounce. Yeah, and then we've worked our way through to a point now where obviously that's 4,700. So I think timing is everything.

But I think what I'm doing here, I'm picking up some properties that they're not sort of true grassroots properties. They've all had some work done on them. There's the excellent government of Finland data set, but there's been 25,000 meters of drilling done on these properties. So I'm not starting from scratch. It feels very much like Rupert in sort of circa 2018, 2019. So maybe one or two seasons away from a new discovery. And obviously we learned a lot in that process leading up to the discovery of Ikkari. So again, I'm not starting from scratch. I'm sort of halfway around the track, I hope. So that's great.

So I think the next plan is to get organized. We'll be sort of, again, providing the market with details about our approach, the list of targets in the portfolio, and then we'll get more granular and more detailed as we go through the summer and we do our work and our targeting work. So the market will know a lot more about what we'll be drilling and exploring in the second half of the year.

Gerardo Del Real: Looking forward to those details. Looking forward to having you back on. Thomas, thank you so much for your time. Appreciate it.

Thomas Credland: No problem. See you again soon.

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