i-80 Gold Q1 & Investor Day 2023 Earnings Call Transcript

Quartr
Provided by Quartr
May 9, 2023

There are 6 speakers on the call.

Operator

I'm told it's time to go. So today is kind of for me a special day. This is the 25th time I've had the privilege of standing up here and presenting to shareholders. And 25 years has gone by like it was yesterday. It's been a lot of fun, ups and downs during the years.

Operator

What I think we've got in terms of our assets and our ability to grow a company here at IAD it's very special. I really thank a very supportive Board. I think we've built a great Board of Directors that I work with here and a management team at I-eighty. And I'd like to welcome today Christina McCarthy as our newest member of our Board. I've been fortunate to have a lot of successes in my career.

Operator

We've right now, one thing I can say is we have 2 projects under month that we essentially discovered Cove that we're doing and Equinox is building hard rock. I still call hard rock, but the Greenstone Mine, which is a project we had in Premier. And this year, given it's 25 years, I thought it's an opportune time. There's a few people I should acknowledge that I've worked with over the year. We've had great long term shareholders.

Operator

Guys like John Hathaway was a shareholder of Wolfend back in 2000. And he's still one of the people I talk to the most as a shareholder more than 20 years later. Cam Curry, a a friend of mine who phones me every day and tells me why gold is going up.

Speaker 1

One of

Operator

the first people who I worked with is a gentleman named John Pollock. And John Pollock, one day, I worked with my dad in the field and for John Pollock. And one day, he said, why don't you you got all these ideas, why don't you start a public company and I'll finance it. And so I did and he actually funded that company. So I wish John was here and I've had a great opportunity to work with a lot of professional mining guys.

Operator

I didn't take mining engineering at school. So everything I've learned is from people. 1 of our first chairmans was John Cook, who spent a lot of time taking me through mines and what it takes to make a mine and build a mine. John Beggeman, who is with me at Wolfden back in the day and we've worked together since was the Chairman of Premier. Ebb Shirkus was a key guy.

Operator

I view him as a bit of a mentor. He's the guy who said, when you build you can build a real company, like, but you have to build it. You can't just sell it. We sold Premier. But anyway, I think the opportunity we have here is to do something special like Ivo said.

Operator

And and you always say a polymetallic mine like LaRonde is the best. And I think what we're doing at Ruby Hill, including the fab deposit that we acquired from Paycor is something that is much like a LaRonde and I have a slide in today's presentation to talk about LaRonde and Yves and what he did with Agnico. And now I learn from Ron Clayton as our new Chairman. Kind of every meeting I learn something new about mining or metallurgy or something and it's really good. I was really hoping that Don Ross is going to be here today because Don took us public in 1998.

Operator

And he was here almost every meeting. And unfortunately couldn't come today. But just somebody who when I started Wolfskin, was taken public, rehab and we were trying to raise 450,000 to go public. We couldn't raise it. And Don Ross and the last day.

Operator

And we had a bit of issues because I was this guy who knew nothing about public companies going public. And the last day was how much do you need to go public? It's another $100 and something grand. We wrote the check, so we went public and he showed up at every AGM almost except he couldn't make it today. But we first launched as a over the counter company.

Operator

So the first AGM, Don, sitting right here. And during my presentation, he said, how come the share price never goes up? And I said, well, you're a market maker, why don't you tell me?

Speaker 2

I said, touche.

Operator

And then Peter Brown, who I got to know, who I knew I was kind of making it in the industry when I used to get the call from Peter in his bathtub. So people who know the bathtub, sorry, Peter Brown, that's pretty unique. He's been a great guy to work with and my father. Story, turn B. I lost him in August and I'm a guy who's following his footsteps.

Operator

There's a kid walking around the bush, following right behind him, looking at head frames, getting little bunny rabbits. The drill scared the family away. There's a baby bunny. So I kind of followed his footsteps into the industry and he's not here to listen today. And the support of my beautiful wife has been key.

Operator

So anyway, that's the it's my bit of a softy. So now we'll move on with the presentation. So 25th year presenting, I kind of view I-eighty as a continuation of Wolf Den. We started Wolf Den, it was taken over, we spun out Premier Premier has taken over, we spun out I-eighty and it's been a really fun ride. I love working with the people I do, the bankers, the brokers, everybody.

Operator

There's a lot of bad days, stocks going down, I'm getting shit. And that's a day. A lot of people phoning, hey, stocks are performing well. So, do a bit of forward looking statement. There will be forward looking statements made here.

Operator

I'm going to be promoting a bit of what we're doing. So I urge everybody to read this when they have time. The participants here today that we have and then I'd like you to talk to who are helping build the company. Myself, I'm the CEO. We have Matt Geely sitting right there, our President and Chief Operating Officer Ryan Snow, right here.

Operator

He's our Chief Financial Officer and Matt Gollat, who I've worked with for 16 years today. Also like to acknowledge somebody else, John Seaman, sitting here. 24 of the 25 years, he's been with me great guy to work with and Abbas, I think legal for basically 25, pretty close. So a lot of people have had the fortunate opportunity to work with and it's working with these people have allowed me to learn what to do and how to build companies. And I really think this is going to be the best one we've done to date.

Operator

So iADI has been around for 2 years. It's our 2nd AGM. We've had Pure Best share performance in our 1st 2 years. In 2021, our share price increased by 29% and 22%. This year we're off a bit, but we'll catch up.

Operator

Trust me, we've got a lot going on, a lot of successes, particularly in exploration. And in our exploration programs. We've discovered recently the Hilltop zone that is a real focus of our drilling at Ruby Hill, what I believe to be one of the world's highest grade new discovery and combining it with fab, I think is going to make for a world class mine that will be around for decades to come in the future. The South Pacific zone is to become our core deposit at the Granite Creek mine. I think our plan is to start mining the South Pacific zone in Q1 of next year is when we hope to get into it.

Operator

So that's our ambitious plan for now. We are progressing mine development. As some people might have noticed, we had our first gold production or gold ounces produced out of Granite Creek in the first quarter and we'll see more here in the Q2 as things continue to improve. We're delivering materials to both Lone Tree and Twin Creeks for processing to increase the Nevada Gold Mines operation. And moving forward, there'll be less going to Lone Tree and more going off-site.

Operator

Our permit submissions have been made for the underground development at Ruby Hill. And Ruby Hill is a project I think is really going to be the biggest part of the future for our company. It's really a project that's worked really well for us and continues to. The exploration decline is more than 70% complete right now at Cove. And today we released our 1st drill results from that program.

Operator

This year we expect substantial growth in our resources given that the South Pacific zone is going to come into resource sometime this year when we release our more up to date studies. We are recently hit about a 200, 250 meter step out in the Ruby Deep zone at Ruby Hill that we will be in filling this year to bring that to resource. So that'll add to our resources or we expect it to assuming success and the 428 Zone discovery that what we believe might be an actually a higher grade deposit at Ruby Hill will be the subject of some drilling in the second half of this year. And hopefully, we get enough holes and prove enough continuity that it becomes part of our resource, maybe a small part, but at least becomes part of our company's resources by year end. And one of the real highlights we expect is to complete following this year's drill program resource estimates for the polymetallic deposits at Ruby Hill.

Operator

That's expected to include the Blackjack deposit, the Hilltop deposits and the FAD deposit, and we expect it to be a very material increase in our company's resources. So talk a bit about gold. My friend, Cam, always harps on me that we got to be the biggest promoter of our industry and why do people own gold. I think what we're seeing today is a real change in people's perceptions towards money. There's a bit of of almost a currency war going on between the East and the West as you might put it.

Operator

And with that currency disruption, I think we're seeing the U. S. Dollar with the ever increasing debt that we see here in Canada and in the U. S. Is making the dollar probably less and less attractive.

Operator

There are challenges, especially the Chinese yuan to the reserve status of the U. S. Dollar. And if there is diversification away from the U. S.

Operator

Dollar going forward, gold, we spec will be the major benefactor of that. And I'm expecting this year to see all time highs in gold and I'm expecting to see those sustained. We're also seeing countries significantly increase their buying of gold for reserves. And I think China just announced another 8 tons for last month. So we're seeing some of these countries really increasing their gold and they're backing their currency with gold.

Operator

And as I said earlier, I think gold will be the biggest benefactor as there is some diversification away from the U. S. Dollar. Since 2020, so a 23 year period. Gold has been one of the few currencies that has realized average gains of 9%.

Operator

And that's when you look at other currencies, it does it has and it will continue to significantly outperform. And one thing one of my friends says to me, gold is the world's only currency that has no political attachment, no debt obligation and no printing press. And that's why I think gold is going to be a store of value for a long time to come. But we're not just a gold company now. We are expecting to be a significant producer of base metals or polymetallic resources in the future.

Operator

And one of the main metals we're looking at is zinc and something that few people know is in 2021, zinc was added to critical metals list by the U. S. Geological Survey, whereas copper wasn't. And zinc is now used in batteries, the zinc ion batteries are some believe a safer alternative to lithium ion batteries. So in the future, we could see an increase in battery production.

Operator

If governments can really put in all the infrastructure they're talking about and going net 0, we're going to need a lot more base metals. So the companies are going to perform the best, I think, as we both need more gold and we need more metals to achieve this green or electrified future. I think the mining companies will be the ones who will really benefit from this going forward. Some things is about supply and supply and demand. If we are going to see significantly increased demand over the next few years.

Operator

It's how would you make enough of these minerals to meet that demand because it takes 5 to 10 years to permit and build a mine. And if you look at Greenstone, for example, that Equinox is building this year, we did the 1st drilling there in 2,008 and today is 2023. So 15 years later, it is in development and in 2024 and it will produce its first gold. So that's a 16 year period from 1st drill hole to production. And that's why I think we're going to see a significant increase in the companies who do produce share prices going forward and the companies like ours who have advanced stage permits and existing infrastructure will be one of the biggest benefactors of that.

Operator

So going to the kind of the exploration development part of today's presentation. Just last week or the week before, we operate 100 percent in Nevada, USA. Nevada was once again ranked as the number one mining jurisdiction in the world by the Fraser Institute. Consistently there, there's a reason why we only work in Nevada because it is a very pro mining state and you're we're very welcome to be there. Having experience in Canada and Mexico, I definitely view Nevada as the significant tier up from working in the other countries.

Operator

The Carlin and Battle Mountain trends shown here in this image, there are 2 structural corridors running through North Central Nevada collectively represent the world's most productive gold districts. In fact, Nevada Gold Mines. All of their production comes from this picture. If it were a separate company, it would be the 4th largest gold producer in the world, next to its 2 owners and Agnico Eagle. So it is a very gold rich area.

Operator

Next to Nevada gold mines. We are now the 2nd largest holder in these districts in terms of gold resources. And we also have significant silver resource in all categories almost 180,000,000 ounces. One thing that I think really gives us a competitive advantage in the state is the fact that we have 2 existing permitted processing facility. We were able to secure a deal with Nevada Gold Mines to acquire 1 of their 4 refractory processing facility.

Operator

That's the Lone Tree site. Lone Tree is a processing facility. We're advancing multiple deposits to ultimately feed and is expected to be the core asset within our portfolio. We're just working on sort of timing of permitting the various projects required to fill that facility. So sequencing is something working through as a Board and as a management team, how do we sequence these two facilities?

Operator

Because we also have Ruby Hill. In Ruby Hill, we've released studies that we're advancing that as not as a gold plant as we're going to convert the Ruby Hill plant to a flotation plant, likely producing 2 or 3 separate concentrates and moving concentrates to wherever we can in the world in the market. So we're looking at we don't really think that it would be prudent for us to try to build both of them at once. The financial needs would be significant. So we're just working through the final kind of trade off work at which of the two facilities we're planning to start up first.

Operator

And as you can see a lot of works going into Ruby Hill and the acquisition of Paycor is demonstrating that we are definitely looking at beefing up our polymetallics or the base metal part of our company in making that decision. So the plan for us is to build multiple mines feeding 2 facilities essentially. And over the next 5 years, our target is to produce on a gold equivalent basis more than 400,000 ounces a year that will make us the 2nd or 3rd largest gold producer in the United States. And so now let's to get the work done, hit the marks of do all the drilling we need, the underground development, the test mining, the bulk sampling, feasibility economic studies and then ultimately ramp up the development of these two sites. We're fortunate that as part of the acquisition of Lone Tree.

Operator

We secured 2 processing arrangements with Nevada Gold Mine, such that they will process, approximately 17 50 tons of material a day on our behalf until we get our own facility up and running. And so that allows us to ramp up in the interim period without having to spend the major capital immediately on our own auto place. So it's been I think a really good working relationship with Nevada Gold Mines. Matt Gilly was once they ran one of their major operations. So good relationships and we definitely try to maintain that relationship as we grow our company.

Operator

As I said earlier, we are right now one of the largest holders of gold and silver resources in all of the United States. We are growing our resource base through acquisitions like the FAD acquisition and also through successful exploration. As I mentioned earlier, we are upgrading Pacific zone at Granite Creek to resource status. The Ruby Deeps and 428 deposits, we expect to ultimately add additional resources at Ruby Hill. We're working currently with multiple drills at both FAD and at the Hilltop and Blackjack area.

Operator

We're working to elevate all of those deposits to 40 three-1 101 resource status at the end of this year. And we spec that, that will move us significantly higher in terms of a company in holding resources in the United States. Ruby Hill is quickly becoming our company's flagship asset. It is the project that we have the majority of our drilling going in 2023. And with the acquisition of Paycor, we're adding 2 drills to our efforts there right now.

Operator

The Eureka District, which is where Ruby Hill is situated, is a really unique area. It's really we call it ultimate optionality. There's just all kinds of different mineralization found here. It's also a district that has a very long and strong history of mining, 150 years of production that started in 18/64. The last of the mining happened in 1966.

Operator

And during that over 100 year period production. Most of the production was from carbonate replacement deposits, CRD, polymetallic mineralization. It wasn't until Homestake came along, ultimately taken over by Barrick and found the Archimedes pit that you can see in the lower image here that Carlin style mineralization was identified here and mined. And that was mined for several years till there was this slope or pit wall failure. Barrick sold the asset and we were fortunate enough to acquire it in 2021 and in 2022 we discovered the Hilltop zone in our first exploration program for generative exploration targets.

Operator

And I'll talk a little more about that. But some of the zones that we're drilling were actually drilled by Homestake and Barrick. And some of the intercepts when we went back and look at DrillCore when they hit polymetallic mineralization obviously. They didn't even sample the basements. They were just looking at the gold value.

Operator

So really opened up a new area. And when you see this kind of history of production in a district like this. It's a real head scratcher. Sometimes people like horses, they get their blinders on and they're only looking for one thing and you missed the forest for the trees, so to speak. With the addition of Paycor to our portfolio in the fab deposit.

Operator

We really now control the majority of the productive part of the Eureka district. And as I said, we call it the ultimate optionality. There's refractory gold, the Rubi Deeps deposit and the 426 Zone are primarily refractory gold deposits, so sulfide mineralization. We have oxide underground mineralization we've identified in the 426 Zone. There's a large seen here in Red Mineral Point, a very large moderate grade open pit opportunity.

Operator

It's an oxide open pit project that we call Mineral Point that we are going to be looking at advancing over the next several years. There's polymetallic CRD like we're seeing at Hilltop and at SAD. We have Skarn base metal or zinc mineralization right underneath the pit in the Blackjack zone that we're drilling. And one thing we didn't press release, but we'll talk a bit about today is we actually have now hit Skarn's kind of copper moly mineralization in on the side of 1 of the intrusives in a new hole that was drilled actually on the fab property. And then it opens up a new area for exploration in the future and hopefully we can identify in the future significant copper mineralization on this property.

Operator

If you look at the geological setup. It's almost perfect that somewhere there should be a big porphyry copper deposit in this district. Not saying it's going to be necessary on our property, but there should be one in the district and we are going to be doing some exploration over the next few years looking at that opportunity as well. So taking the blinders off, we're open. We hit high grade lithium, maybe we'll start looking for lithium.

Operator

That seems to be the hot thing today. What's really unique about Ruby Hill is there is an operating heap leach facilities and we are producing gold off that heap leach today. There's an on-site oxide milling facility and that is the mill that we are currently doing work on and doing metallurgical work on the various deposits looking at converting that to a base metal plant. So Ruby Hill in the future, I think will be a very unique mine and you turn left, you go to gold, you turn right, you go to base metals. It will be a unique operation that have the same decline will mine both gold and base metals.

Operator

So I'm looking forward to that. And as Epirka said, these polymetallic deposits are the best deposits. They survive metal cycles more than just 1 metal deposits and they are the most profitable. And I'll talk a little bit about LaRonde, just a bit of a comparison of LaRonde. It's a bit of a thank you to Yves, who's always said, get a polymetallic posit and he's not with us on our board anymore, but we finally did it.

Operator

We're completing the permitting. This year, we've got a lot going on, completing the permitting underground programs working on the preliminary economic assessment resource update for the Ruby Deeps deposit. So that's gold only. We're not yet in a status where we can move the base metals into PA. Hopefully by the end of the year, we'll start doing the economic studies on the polymetallic deposits.

Operator

We're doing the metallurgy on the various deposits that form the polymetallic zones at Ruby Hill as we're looking at do we convert this plant to flotation. We've got significant exploration and definition drilling going in multiple areas and expecting multiple year end resources at this project. They'll be released early next year, but we'll be drilling hopefully until about November December on these deposits and then have a cutoff date and start working on the resources. The Hilltop discovery that we made is part of this major structural trend. It's a north south striking fault structure.

Operator

Some of the faults, there's the Jackson fault is being referred to the Holly faults, there's various large scale faults that run for, as we know it, more than 10 kilometers through the district. And the image on the right, all the red dots are polymetallic deposits, whereas the yellow dots Zarkarlin type deposit. So the district just seems to be more endowed with polymetallic mineralization or base metal mineralization than gold. Though we in our portfolio feel that the best mine in terms of mine ability within our portfolio is Ruby Deeps. So that's something that we'll be talking more and more about this year.

Operator

But these polymetallic deposits in the Eureka districts or very unique in terms of grade. The historic Ruby Hill Mine, which is really the up faulted part of the fab deposit, If it were in production today, I believe it would be the highest grade gold mine running in the United States right now. It also had multi ounce silver over 15% lead. It's a really classic deposit. And the area between Fad and Hilltop is all alluvial covered and there is essentially no drilling in that 2 kilometers.

Operator

So we think there's great opportunity to find significantly more mineralization as we drill out this structural trend in the future. We're permitting. We have to go through the BLM to get permits to drill in that area. It wasn't previously permitted for drilling. And we're going to do additional geophysics to make sure that we were using all the tools necessary to hopefully make the best decision on where to drill and have the most success.

Operator

The Hilltop fault structure is something that we've identified over really the last 6 months. Since mid-twenty 22 in June when we hit the Upper Hilltop zone or the Lower Hilltop zone, we have made 7 new discoveries on the property. So that's almost a discovery a month when you look at it. We've discovered the Lower Hilltop zone, the Upper Hilltop zone, the East Hilltop, which is the Skarn zone. The 428 gold zone, we drilled our first hole into in November of last year and we have yet follow it up, even though that intercept was 12.3 grams over 10.7 meters.

Operator

The East Hilltop CRD is something brand new that we just hit as we've been drilling the eastern extension of the Hilltop fault. Just I think last week, we announced that we discovered mineralization, the CRD Breccia zone to the west of the Lower Hilltop zone. It's likely the continuation of Lower Hilltop, but we need the infill drilling to prove that it is continuous now. And at depth, we hit a new zone called the Getty CRD with an intercept of over 9% zinc that at some point will follow it up. It's not something that I think we'll be looking at in the near future.

Operator

So it's just been pretty remarkable, but it is one of these northwest striking fault structures we've identified. And that's really where we find the controlling mineralization. Closer yard to the fault, the higher grade material. You start to move away, the grade drops off. And then they occur in lenses, which is quite typical of CRD mineralization.

Operator

And then right underneath the pit, unfortunately, it's very difficult to drill because there was a pit wall failure that you can see in the lower right of the pit and we're not allowed to access that part of the pit for drilling. So we're doing some directional drilling with moderate success getting to the target, but we are starting to get some intercepts into the blackjack so that we can upgrade it to resource status. On a sort of a sectional view or a long section view, the Upper Hilltop zone has been fairly densely drilled. We're hoping to do with some additional drilling later this year once we get the permits for the new drill pads is to hopefully do enough drilling into that zone so that it can be classified as indicated mineralization. So we can start looking at economic work or wrapping economic parameters around it.

Operator

The East Hilltop is fairly shallow as well. So once we get the new ability to set up new setups and probably do a bit more definition in that area. And then at depth, we have the Lower Hilltop zone and the Getty's horizon that will be subject to some drilling, but not really a big focus because they are deeper and would be many years out in terms of any mine planning, assuming we get there. So talking about the development plan, we are planning to put in 2 portals out of the kind of the mid depths of the Archimedes pit driving north towards the 426, that's a gold zone. And then as you can see in this image, you turn right and you head towards Blackjack and you head south and you go to the hilltop zone.

Operator

So we've got a great mine team that we've assembled at IED and they're working through the planning of how do we do this? How are we going to pull it off? And I'm sure we will once we get to it. The layout of the site is shown on the image on the right and that is something that we're expecting the permits so we can start the groundworks and setting up for the underground program in 2023. This is one of the conceptual models of how are we going to mine all these zones, the 426 and the Ruby Deeps or the Carlin type refractory mineralization.

Operator

Blackjack is Skarn Zinc mineralization and the upper and lower hilltop zone our CRD polymetallic mineralization. So as I said, all of these are being looked at how will we mine this, the base metal material. Hopefully, we get processed rate on-site with the conversion of the mill that you can see the image of here to a flotation plant and the refractory mineralization will be trucked either early on to Nevada Gold Mines as part of our interim processing agreement, but ultimately one of the main deposits to help fill our own auto plays ultimately and make ourselves a self sustaining company in the state. Mineral Point is the biggest deposit in our folio, something that isn't in our general corporate presentation, but it is there. It's right beside the existing Archimedes pit.

Operator

It is when you include indicated and inferred mineralization, it's nearly 5,000,000 ounces of gold and almost 170,000,000 ounces of silver. So in terms of one single deposit, it is actually the largest deposit in our portfolio, but it isn't part of our 5 year plan. We're kind of working with a 5 year plan, but it is something that we're looking at. So in our 10 year plan, how are we going to grow? We can grow organically, hopefully with projects like Mineral Point.

Operator

The first hole, we were actually drilling polymetallics, but we drilled through Mineral Point earlier this year and that drill hole was 1.2 grams over 50 meters. So really good grade mineralization and that deposit does have some upside opportunity, but it's not something we're targeting in the near future. The addition of Paycor, we think, is going to be a real key acquisition for our ability to develop deposit that will go long term in this district. It provides us with about 2.5 kilometer extension along that sort of route Jackson fault structure down to the south that runs up to the Hilltop fault and the Holly Fault, which runs parallel to it. It also consolidates the northern part of the district.

Operator

And with our advanced stage permitting and existing infrastructure, it will allow no problem. It will allow for us, I think to pay for our shareholders to benefit from our infrastructure. If Paycor were going it alone, I believe it would take a long time to be able to permit, to dewater, to build the infrastructure. And by combining the two assets with our advanced stage permitting that we're doing at Ruby Hill, more for us to move it for the through amendments to existing permits rather than brand new permits. So it should allow for the permitting process to accelerate to develop a project and what I believe to be a world class project like the bad project at Paycor.

Operator

And this image is taking that earlier development image and sort of looking at how does this look long term. So the big picture, so to speak. We have all of the mineralization proximal to the Archimedes pit at the north part. So we're looking east in this image. And then at a similar depth is the lower hilltop is the fad deposit about 2 kilometers away.

Operator

It has the old fad shaft is there. So people who I hope some people in this room of either being there or are going to come see the project and you'll see the fab shaft and all the infrastructure that sits there. But ultimately likely using that as a ventilation raise or something and linking the 2. And that will provide us significant access to at 2 kilometers in between that is essentially untested and we believe has the potential for multiple deposits. The fab deposit is, in my opinion, one of the world's premier polymetallic deposits.

Operator

It's that one deposit that you look at. And as I said, Yves Sherkis is one of my I call him my mentors when it came to are we really going to build a mining company?

Speaker 2

It was like Yves, who was like, we can do this, like don't be scared.

Operator

Yves was always like, you got to find one of these things and FAD really fits that mold. If you look at the drill holes they did in 2022, fantastic results. I think the last hole was PC-two thousand two hundred and ten that hit 27 meters of 8 grams gold and over and 11% lead zinc. That's world class in any district and that deposit is open. And one thing that they been very little work on that we may advance.

Operator

We want to look at what the metallurgical properties will be. Is Gold Hill at drilling the oxide mineralization around that historic mine. Is there an open pit opportunity? And hole 2 of their 22 program hit 2 intercepts, 23.9 meters of 2.3 grams gold and about 4.5% lead zinc and the second intercept of a Gram Gold and over 5% ledening. So it does identify that there is a potential significant scale and maybe significant scale open pit bull project here that I don't think we're planning to drill.

Operator

Tyler will hear, he told me, but I'm never planning to drill it this year, but something we'll probably do a little more work on in 2024. And I put this in here for my friend Yves because he took a bunch of us to see Laurent and when he joined Premier and really proud of what they built there. And one thing he discussed is how you build a real company and LaRonde is still one of their flagship operations. And I point out the grade of FAD here because FAD is actually higher grade than round and I'm not throwing dirt at LaRonde, it's a great mine. But sand is one of those deposits when you combine it with the Hilltop and Black act that I think gives us a world class opportunity in the polymetallic deposit.

Operator

And when he was working with us, he talked about when they built Aneco. They almost ran out of money. I think he was using his own bank account for salary. He was telling us about what at one point because the market was so bad, they couldn't raise money. They were building 3 mines at the same time.

Operator

People thought they were crazy. At that time when Laurent came on, they were trading at $3.50 And I referenced that because that's roughly where our stock is trading today. And if you look at Ignico today, day. It's one of the most respected companies in the world and that's what I hope we're going to build here with IED. Quickly just look at the fab deposit, the copper potential, because in the area this year and as many of the analysts know we've been talking about somewhere there should be a porphyry.

Operator

We're doing some just cursory work around that. But hole 2316 was drilled this year on the fab property in RC Hole tested an intersection of structures. And you can see in the magnetics here that that sort of maps out what they call the Ruby Hill intrusive body. It's intrusive, potentially could be porphyry at depth. But when we did drill that hole, we hit over 100 meters of magnetite bearing, Skarn mineralization locally, what our geologists have identified as being copper, boronite and moly mineralization within that pool.

Operator

I'm not expecting to be a barn burner by the way, but it proves that there is a different style of mineralization in this camp that's never been looked at. And it's something that with the geophysics will further our knowledge of this target and ultimately do more drilling. The Ruby Deeps in the 4/28 zone, 4/26 zone and now the 4/28 zone are the Carlin type refractory mostly refractory gold mineralization that we see here. Hole 9 of our drill program at Ruby Hill this year, we intersected 7.3 grams over 10 meters, about 2 50 meters south of our southmost drilling from last year in the Ruby Deep zone. That opens a pretty significant area up for extension of that deposit.

Operator

And later this year, we will do that infill drilling with the hope of adding resources to our Ruby Deeps deposit. We're also planning from in the area, we're doing all the groundworks in the pit later this year for the ultimate underground plan is doing some additional drilling because you're down quite a bit in elevation, it saves us a lot of money in drilling. So we're going to wait till we're down in the pit to do more drilling in the 428 Zone, but it is something that could become a part of the future of this operation if we can demonstrate continuity in that structure. The grades and widths and mineralization at Ruby Hill are very impressive. We're expecting to see an increase in grade based on our drilling in this deposit that will be used in our economic studies compared to what was done by Waterton prior to us acquiring the asset.

Operator

But I put this image here of the core because for a Carlin type gold deposit in Nevada. The ground conditions appear very, very confident. And for us that means easier mining and more tons. So it's a project that I think is going to really It is really the deposit, I think, that's going to help us build the autoclave ultimately once we get that site up and running. And again on this long section view on the right, you can see the location of Hole 9 from this year, mineralization immediately Lee underneath the Bowacker sill, exactly what we see with the Ruby Hill deposit, the main part of the Ruby Hill deposit 200 meters to the north.

Operator

The 428 zone is kind of in between Blackjack and the Ruby Deeps It was actually a single drill hole drilled by Homestake into a deeper rock unit that they really didn't target in the open pit area other than the one hole. It was 1428, but it was 15 grams over 5.5 meters. So we said, that's a pretty good hole. We should at least put one hole in and see what it looks like and we hit 10.3 grams over 10.7 meters completely open for expansion. So it is a target for us later this year that we hope adds high grade, even higher grade resource ounces to the Ruby Deeps deposit.

Operator

Next, we'll talk about Cove because today we put out results from Cove. Cove. There's a project that we acquired. I think Tyler said the first drill hole was was it 10 or 12 years ago? I think it's 15 years ago, time's flying.

Operator

But we stopped drilling the Cove deposit in 2018. So 5 years ago, we stopped drilling in favor of advancing permitting to go underground because it is a deposit that occurs at about a depth of the upper parts of the Helen zone are about 5 50 meters and goes down to about 700 meters, which is what's known. And to do a definition drill program, as you can see, our current resource is about 1,700,000 ounces at nearly 11 grams, but the bulk of that 1,300,000 tons is inferred. So we can't do feasibility studies in inferred resources. So we need to complete a significant infill drill program to complete a feasibility study.

Operator

And we did the analysis to drill all these holes from surface. We're going to lose some because of deviation as you go down. What's the cost of that program and we felt it was going to be well over $30,000,000 to do the definition drill program. And we did the analysis, well, what does it cost put in the decline and drill it from underground. It came out, our analysis was it should be less.

Operator

So we decided to permit, put in the underground and drill it from underground, which actually saves money, but it took time to permit. And the drill holes that we announced today, I think, really confirm what we've always felt about Cove. I think a lot of people forgot about this asset. But the first in the first four holes drilled into the Gap Zone, the darker blue that you see in this image. We had intercepts up to 36 meters of nearly 13 grams.

Operator

So it does in place have really good width, relatively good ground conditions we expect. And this drill program is about 40,000 meter drill program that we're doing. So we should see a lot of results over the next 12 months as we continue to drill this and maybe a bit of step out drilling to the Southeast later in the program. Lastly, we'll talk a bit about Granite Creek before we take a few questions on the floor, if there are any, and or else hopefully everybody will join us for a bit of a celebratory drink for 25 years of being up here. Cove I mean, Granite Creek is one of Nevada's newest high grade gold operations that we are just doing a lot of work at ramping up.

Operator

Granite Creek property. It's situated right beside Turquoise Ridge and Twin Creeks, which is, I believe, the 3rd largest operation of Nevada Gold Mines up against the Osgood stock. It's an intrusive complex. Fault structure runs along the eastern contact of the Osgood stock. The north end of that stock is Turquoise Ridge.

Operator

It's about a 25,000,000 ounce mine. It's a great operation. And on the south end of the stock is where the Pinson or what we call Granite Creek is located. Last year or early in the program, we discovered what we call the South Pacific zone, which occurs immediately north of the historic mine workings and the primary OG zone, which is the zone that we're developing right now underground. But our plan is to get into the South Pacific because you can see in this image, the South Pacific zone has a significantly larger strike length that we've identified than the OG zone.

Operator

So hopefully tons per vertical meter as we get into mining more and more in the future, we'll increase by including the South Pacific zone and that's some of the work we're advancing right now on the property. So I am going to not just take all the thunder today and let Matt Geely come up and talk a bit about the underground work that we've been doing over the last year at Granite Creek and some of the, I guess, the good, the bad and the beautiful that comes out of this kind of work. And I'll let him end the presentation today and urge everybody to come talk to us after presentation here.

Speaker 2

Thank you very much, Ewan. So I'm going to take you through 3 slides to talk about Granite Creek. Just really show first what we're currently doing. I want to talk about how the second slide, how the development ramp up is progressing. We're seeing a really steadily increase in our production development rates, our execution of the development plan.

Speaker 2

Lastly touch on where does that all mean really bringing in the South Pacific. So on this first slide here what you see is these are the current production areas. The areas to the left of this slide, that's what we refer to as the OG zone. So there's currently 4 sub levels in production on the OG zone. We might underhand.

Speaker 2

So what you see on a sublevel in the OG zone, the top cut of the sublevel is the cut you see there and we'll be mining down on the subsequent three cuts. Okay. So that's what you see there. You do see on the auto side, which is the right hand of that side. You do see 2 active work areas we have.

Speaker 2

We have some remnant mining happening around the 4,600 level. And then you see we have put in one new sub level in the 4,500 level area. That's a small sub level. We're really focusing on the OG and that's the area of most importance for us right now. So we talked about the top cuts.

Speaker 2

We'd also talked about, look, we're proceeding cautiously on this is a very high grade deposit. It is also very tricky. So we're learning a lot. We're using these top On the sub level, so understand where the ore envelopes exist. We're doing a lot of pausing for cover drilling to better delineate the ore.

Speaker 2

We want to make sure we do this correctly and do it efficiently. It's really then all that data you get from the top cut and translates immediately below you. And then that's when you really start seeing the pickup in the rate of coming out of there. Some statistics for the quarter. We shipped 9,389 tons of material to Lone Tree, that's oxide material.

Speaker 2

We are encountering quite a bit of oxide material coming out of Granite Creek. In fact, the majority of what we produce right now is oxide material and OG is primarily oxide. That material so we had something to do we need to do something with that oxide material. For the last quarter of last year and the very beginning of this quarter and this year, we were shipping that material to Lone Tree for leaching. We're leaching that on a dedicated portion of the Lone Tree pad.

Speaker 2

It's got its own cyanide drain now. So we can process that separately from the rest of the heap leach there. We do a high intensity leach. We're getting gold off there. We sold 444 ounces for the Q1.

Speaker 2

That gold continues to come off there. It's working. It's really not ideal and we're looking for better alternatives. Right now, we've stopped shipping ore to Lone Tree. We're stockpiling the oxide on-site and we're looking at better alternatives for how to process that oxide and we will certainly keep all of you informed as we progress with that.

Speaker 2

So for the quarter, we did mine 16,000 tons at 9.9 grams. That's all ore types combined. We completed 18 70 feet of development. And as I said, we sold 440 So the development ramp up. What we're really pleased with is this curve, okay?

Speaker 2

We had a really steady ramp up when we initiated in 2021. We kind of plateaued in the second half of twenty twenty two and it's really picked up dramatically this year. What is the cause of that pause? We encountered Two issues as a company. 1, we started to hit water, not a lot of water.

Speaker 2

We're talking in mining terms, 150, 200 gallons a minute of water. What we need to do is to that water pad above level limits for arsenic. We couldn't just discharge it as we normally do. So we had to work out better methods, safe environmentally safe methods to contain that water. We've worked through a lot of that process.

Speaker 2

We understand the water better. And so we've been able to take that knowledge and better water management and that really helps development rates. When you're driving a decline that's wet. You're swimming in water. And water you can remove makes everything go better.

Speaker 2

The other thing that's happened is there's been some changes in the mining industry in Nevada. There's been some major operations that have gone care and maintenance. We have been able to take the best talent and the best equipment from those other operations and deploy them at Granite Creek and that's part of what you see as the increase in production rates there for development. What you're seeing on this isometric view here is the upper areas, the OG and auto as I talked about before and then you're seeing where the South Pacific comes into play. We're about one more sub level away from being coming across on the top of the South Pacific.

Speaker 2

As Ewan pointed out, we are on schedule to blast our first still in the South Pacific zone in the Q1 of next year.

Operator

All right.

Speaker 2

So lastly, I want to talk about the South Pacific zone itself and what we're seeing there. This is a long section. Again, I point out the current workings, I point out the lower OG and I point out the South Civic. We will continue down that main OG ramp. But as I said, coming across at the end of this year to the top of the South Pacific and start down on that side as well.

Speaker 2

What you do see here is you see a gap in South Pacific. And we don't believe that gap is necessarily there. We're lacking data. So we're proposing a 12 hole program, 21,000 feet of surface holes to fill in that area. There's some inferred resource.

Speaker 2

There's the lower part of South Pacific has the widest intervals and it has the best rate. So we propose a 12 hole program, 21,000 feet to fill in that area and provide better knowledge for our planning and for our technical reports as we go forward on that. That's pretty much what I have with regards to Grant Creek. Ewan, is there anything else you would you want to come back up and Closeout. Well, it's been a fantastic honor to be here with you today, Ewan.

Speaker 2

Thank you very much for taking us through it all. Fantastic company to work with and for. I'm very honored to be here and thank you very much.

Operator

Thank you, everybody. So we do have a microphone here if anybody want to answer ask a question. But if somebody doesn't want to ask a public question, wants it to be more private, we're all going to be here for the next half hour or so. So feel free to either come up if nobody see nobody moving. Let's mingle a bit and very happy.

Speaker 3

Could you comment on cash flow? I understand you're going to have a little bit more gold over the balance of the year production and you've got cash, but will all that Cover the ambitious plans you have or what are your thoughts?

Operator

Mining is a pretty capital intensive business is a good way to put it. So I would say that the amount of gold we're producing this year is not going to make us cash flow positive this year. Our goal is that Granite Creek for it itself next year is hopefully it becomes on its own cash flow positive. But as we're developing Cove, obviously, we're not producing any gold out of that. Ruby Hill likely won't be until the year after next, where we'll start to see a ramp up in production.

Operator

I think you'll really CF have to use existing cash, whatever cash we do get from gold production. And we'll obviously continue to look at other alternatives at how we finance our growth over the next couple of years.

Speaker 1

Jump in.

Operator

I'm

Speaker 2

sorry, go ahead.

Speaker 1

I'm sorry to disappoint everyone that I don't have a question. I just have a comment.

Operator

I've seen you at a lot of our AGMs. It's been great to see you again.

Speaker 1

I have been coming to this meeting for almost 10 years. And today I learned more than what I have learned all these years. And I have Moved so much in the first three minutes of your talk, and I'm sure everyone else must have moved with this talk. And I feel I just want to acknowledge that I'm in good company, both figuratively and literally, in the sense I'm with good people as well as in good companies that I'm invested in. I hope you will continue the good work that you have been doing.

Speaker 1

Thank you

Operator

very much.

Speaker 4

Just had one question about the drilling from Ruby Hill. You mentioned the trade off study at Cove, what was better drilled with the underground access versus from surface. So with the declines planned to go into Ruby Hill, are there portions that you're thinking might hold off drilling that are better tackled from an underground access versus from surface.

Operator

Yes, much like we were doing at Cove, the plan is for all of the infill drilling in Ruby Deeps in 426 Zone to do it from underground. You get a lot better precision on your drilling. Underground drilling is actually a lot cheaper than surface drilling. So we actually want to get underground drill because it starts saving us money. So getting that underground access will be critical for us doing the infill.

Operator

And much like we're seeing at Granite Creek, it will provide a platform for us to start, as I'd say, test mining. We can look at, are we going to take top cuts or in the long haul? We can try different mining methods, which one works so that ultimately when we deliver a feasibility study for Ruby Hill, It will be based on real time data, not just a bunch of surface drill holes. And let's hope this works when we get in there. It'll a lot more advanced than I think you typically see out of a junior development company.

Speaker 3

Got it. That makes sense.

Speaker 4

The other question I have maybe better directed to Matt Gilly. The ground conditions at Granite Creek, I know that's a it can be a tough shear to mine on. So any kind of color there on what you're seeing or how you kind of plan to tackle the sub Pacific zone or any differences there versus OG?

Speaker 2

Great question. We were extremely cautious when we first entered into Granite Creek and we had we did some test mining. We have on-site instant delivery of shotcrete always available. And in our development drives we do shot creating on cycle. The ground conditions on the OG side have been Incredibly surprising, very good, right?

Speaker 2

So we are really not ground conditions on the OG side are really not a limiting factor to how we advance other than just the water. The auto side is a very much more difficult ore body to mine. You see we're really not focusing much on the auto. We only have 2 sub levels there that we're even working doing any work on and we're really not talking about putting in more of us. So you're right.

Speaker 2

I mean, where we are now, we are very pleasantly pleased with the ground conditions and they're not a limiting factor in how we progress. What do you expect? So it just keeps seem to be it seems to be getting better as we go deeper. And what you're seeing on the South Pacific is a really competent host rock. That's what makes it easy for us is if your development openings are easy to maintain.

Speaker 2

You don't have to go back and rehabilitate your development. You can just progress and roll

Operator

that. Perfect. Thanks.

Speaker 5

I think it's an understatement for me to say you have a lot going on. That's an understatement. My question is, how are you prioritizing what needs to be done? Like what do you see going forward? Are you going to you already have a plan as far as one deposit over another because you could spend, I'm sure, dollars 100,000,000 if you had it.

Speaker 5

So what's your priorities and what do you feel is going to come first and second?

Operator

So I'd say our priority on the gold side is ultimately we want to start up the Lone Tree autoclave. But autoclaves run hot, so like really hot. You're cooking ore. And you don't want to be heating that up and cooling it off. So when we turn on the autoclave, We need to be filling that every day.

Operator

It's got to be and to do that, we need 3 mines. If you look at Nevada Gold Mines, their autoclaves and roasters that they're using. They're being fed by multiple mines to keep them full. We need to do the same thing. So in terms of developing our gold portfolio, the Carlin type gold mineralization.

Speaker 2

We have to

Operator

prioritize all three deposits. That's why by year end we expect to be on the ground on 3. Big ambitious plans as you say, but we've got a great team. So we'll pull we're going to pull this off. The other side of it is what do we do with the Ruby Hill plant?

Operator

And Ruby Hill converting it to base metals of polymetallic production. On a capital basis, it looks to be lower than starting the Lone Tree site. We probably will be able to access significant ore in the Hilltop Blackjack zones before we get all 3 gold operations going. So I'd say for me personally, we're sort of leaning towards starting up the Ruby Hill plant first. And then as we advance technical studies, feasibilities on our project, we have to get Cove up and running.

Operator

We need to dewater that. That really controls the timeline of starting the autoclave. So right now, we're leaning towards probably starting up the Ruby Hill plant first. We do have the benefit of our interim processing agreements with Nevada Gold Mines to process refractory ores that allows us to ramp up. I think Nevada Gold Mines, when we did this, one of the first questions was, we were talking about Lone Tree, was how are you going to fill this thing?

Operator

And we're like, well, we're going to buy Ruby Hill. And we got Cove and we're going to we've got Granite Creek. So the 3 of them will fill that. And they were like, okay, but you guys aren't going to have enough capital to build 3, stock pile, all this ore started up. The working capital will be insurmountable for us.

Operator

So that's where the income processing came in is it helps us ramp up all three operations and then start the auto play. So that agreement was key for us to be able to grow our business, I would say. So I assume we're prioritizing everything, just like Yves did when he built 3 operations to make Agnico at once. People told him he was crazy, him and Shawn Boyd, but they did it. And look at them today.

Operator

So that's kind of what I look at is that's who we're going to be and that's what we're going to build. Thank you. Thank you.

Speaker 2

Any chance of bringing Yves back?

Operator

No, we got a great team. We got a great team.

Speaker 1

I mean, he's in touch.

Operator

He's in touch. He's in touch. He's in touch.

Speaker 2

He's in touch.

Operator

He's in touch.

Speaker 1

He's always calling you.

Operator

We still keep in touch. John sees him quite often down in Florida, but he's sort of retired now. It would be mostly retired.

Speaker 5

Can you give us a little more color on the dewatering timelines at Cove? And when can we expect to have an updated resource and an economic study around this deposit.

Operator

Okay. So the question for those online was development or dewatering timeline for Cove and when we expect to get the feasibility done. So Matt Geely is running that side of the business. I'll let him take care of that. All right.

Speaker 2

So great questions on coke. The coke pit was of course dewatered by Echo Bay. And it so technically, it's completely feasible and was done. We're going to want to dewater faster than COVID, then Equobate did when they got COVID. So right now we have begun the process for the EIS to dewater that pit back to its condition as it was with Echo Bank.

Speaker 2

We anticipate that being A 3 year process. In that time, we'll be drilling the wells necessary. It's 15 well field is what we see there at Cove. So a 15 well field putting in the rapid infiltration basin where we so we're not consuming that water. We're taking our water out of the pit area and we're re injecting it into the same aquifer just downstream.

Operator

It goes back in.

Speaker 2

It does. It goes back in. But this is the system. Let me just stay with the system. So we're anticipating the 3 year program to continue with that.

Speaker 2

In the meantime, what we're going to be doing at Cove is we're driving this development decline down for exploration. That horizon you see at Cove, that elevation of the exploration decline is about 10 feet higher than the water is, right? So that's why it's there, which is down as far as we can go right now. We'll finish drilling that out over the course of this year. We'll complete and upgraded study for COVE in 2024.

Speaker 2

I would anticipate that going straight to FS. I don't anticipate needing to do a PFS at Cove. I think we'll have enough information. With that much infill drilling, we should easily have of identified the indicated resource and be able to do a full feasibility study on that. And that's the plan for our advancement.

Operator

I don't see anybody else with a hand up. So please everybody join us in the corner for a glass of water or something else. And we also have snacks here as well for everybody. And we've got a lot of our team, I think our entire board and our entire senior management team is here. So please feel free to come say hi and Thank you for the very kind words.

Powered by Quartr
Earnings Conference Call
i-80 Gold Q1 & Investor Day 2023
00:00 / 00:00