[Music] Hello and thank you for joining us. This webinar is titled BC's Next Gold Mine: Blue Lagoon Resources Path to Production. My name is Marilyn Deuzmann and I will be your moderator for this event. It's now my pleasure to introduce today's speaker. Rana Vic is the president and CEO of Blue Lagoon Resources. With over 30 years of business experience, Rana helped launch five business ventures in the private sector and has been involved in several publicly traded companies since 2010.
Rana has served as president of Musgrove Minerals and as chairman and CEO of Continental Precious Minerals. He is also former chair of BC Open Learning Agency and serves on several public company boards and committees. He's a 2017 recipient of the Canadian Senate's 150th anniversary medal awarded to top Canadians actively involved in their communities making their hometowns and communities a better place to live. And I'll turn it over to Rana for his presentation. Well, thank you very much. Uh it's a
pleasure to uh be here today and I'm excited to share um what I believe is one of the most exciting opportunities in today's market. uh if you're uh interested in gold or want gold exposure, I think that we have a very very compelling story that I'm about to uh share with you uh here uh uh this afternoon. So with that uh uh let's begin uh I'd like to start with the uh traditional uh uh disclaimers. The as you know or may not know I'm will be making various forward-looking
statements. I would encourage you to uh read our our our disclosure our disclaimers um at at your at your at your leisure. Um so let's get into it here. So our project is uh uh in northern British Columbia. Uh the Dome Mountain Mine. Uh if you're familiar with uh Northern British Columbia, this is Smithers, a small mining town. Uh it's it's actually one of the busiest mining towns in the province. uh the uh it it it serves all of the the north and and and the Golden Triangle area. Our
property is uh uh roughly 50 minutes from the the the town of Smithers that you can see here on the left here. And you can see here the road that goes right through the dark area here is our property, the Dome Mountain. And you can see the the road that runs right through the the the property. Uh and this little corner here is where our focus is and that we're going to talk about our main boulder vein. So, if you remember nothing else in this presentation, here's what I want you to remember. We
are only one of nine permits that have been issued in the last 10 years. Just a couple of months ago, we achieved what seemed impossible. It took us uh nearly 5 years, which everyone was congratulating me, but I thought it was four years too long to be honest. It still took us 5 years. And we're only one of nine permits that have been issued in the last 10 years. And if you look at number three and number seven here, you can see those permits were actually for coal. So really only one of seven in the last decade that have been
issued. Now this says a couple of things. Number one, it's extremely difficult to get a permit. So that you know give us that makes it unique and the barrier of entry is high. And number two, it speaks to our our team. It speaks to the ability to to execute. Uh uh so hopefully you you this demonstrates that uh that you know that ability to to to put something into to move something forward. Um this is our our our mind site. You can have a you can see here the the infrastructure uh here in the in the in the right hand
side here. You see here this is the portal. There's about a thousand meters of development that's already taken place. So when I founded this company back in 2019, I looked at over 200 projects. And one of the reasons the main reasons why I took on this project and decided to to uh to to buy it was because it ticked one of the main boxes for me, which was can it be permitted? You know, there are many many great projects out there, but man, I think I'll be in a wheelchair before those
things ever get into production. So this one, we knew it could be permitted. I thought I could get it done much much sooner, but took us still, you know, roughly four and a half years, but here we are. So the development there has been about a thousand meters of development and we started we've invested uh uh about $40 million in in putting in all this infrastructure our our company and the company that we acquired uh to be able to get to the place where we are today. You can see here this is the entrance of the of the
of the of the portal. You can see here on the right hand side a rescue station that we put in inside not too long ago. Here you can see inside here you can see the infrastructure inside. You can see all the all the electrical that's been that's been done. Uh this is a recent photo that when I was up there three or four weeks ago, you can see the the inside of of the tunnel. Uh some some mining equipment that's already in place, a mechanic shop. Uh this is our uh our our uh contract minor. So we're
going to be contract mining this. One of the beauties and the advantages that I have is that the the uh the property is, as I mentioned, less than an hour drive from the town. So that allows me to attract a very very senior people. And this guy here, for example, from Cobra Mining, Wayne Kendrick, just a incredible person who has a tremendous amount of experience, lives right there just outside of town. So, uh, you know, everybody's happy that way that they can they don't have to be out somewhere, uh,
in the bush or, you know, somewhere for 2 or 3 months at a time. They can they can come right back and and drive home. this this gentleman actually one of the other advantages that he has he he actually was mining this very same mine uh back in the in back when in the Nanda days so he's got a lot of experience and knows the project very well the team uh other than myself you can read more about this on your own but I do want to point out to the the gentleman at the bottom right here Steve Cuddler he's one
of our mining consultants he's uh extremely experienced in narrow vein mining uh he's currently one of the one of the people who are consultants at the Still Water Mine uh which are you know narrow narrow veins. So very very experienced there. Uh Peter Bojos one of our advisers has uh uh experience in over 80 countries and has been involved in in operation uh of over 24 producing mines uh openings, reopenings, production. He was up there just recently with with me as well. Uh so we have some I've I've I've been able to
surround myself with some incredibly talented people who are going to help us uh uh uh transition from exploration into production. Uh Quinton Henny, some some of some of you may know him, a worldrenowned geologist uh consultant, technical consultant to uh to Crescat Capital who is a a big shareholder of ours. You know, it took me months and months to get Quinton's attention to to take a look at this project because he just, you know, he's he he he likes to see really, really big, huge scale
projects right from the get-go. And uh, you know, he hadn't heard of this project before. But boy, I'll tell you, after we finally got his attention and after a 90minute technical call, his very last words to us were, "You boys have a hidden gem here." So you know we have the we have uh uh uh it's it's been a pleasure to been to be able to attract people like that who are in the know who have been investing in our company for the last three or four years and Krescat of course now is almost 10% of our cap
table. So many of the decisions because I am my background is not in mining or geology. I'm not I'm not an engineer or a or a geologist. the business decisions with this company that I that I have made and I'm continuing to make are surrounded by you know sound business pr principles in my opinion. So one of the things that we did is we are going to be toll milling uh uh here and one of the things that that we did is even though the metallergy had been done uh prior to us uh acquiring this project I wanted to
reconfirm everything. So, we have a a long-term milling agreement with uh Nickeola uh mining that has a state-of-the-art mill in merit. And one of the things that we did is a couple years ago, we took out 5,000 tons of mineralized material from the mine and we sent it to to Nicola to get it processed. And I wanted that that was the purpose of that was uh twofold. One was to give us operational experience because I knew the m the permit was coming at some stage. I wanted our team to get operational experience so we can
be ready from day one once the mine uh uh got its permit and we could get into production. So this g gave us about four months of operational experience. Number two, if you look at the bottom here, you can see the the results were stellar. We got nine it the mill confirmed reconfirmed 9 g a ton of gold and uh a 95% gold recovery. So you know which was really which really is exceptional in my opinion. that allowed us to uh uh see firsthand, get a feeling firsthand of uh how it would feel to be in. You can see
here one of the trucks that was sent out to uh to Nicola and that's our mineralized material that's being dumped um on one of their pads and behind it you can see the uh one of the conveyor belts that uh that takes it up to the uh to the site. Uh here you can here you can see me when we sent them uh into the material lab being crushed put into uh one of their primary crushers and then moved up along the conveyor up to their secondary crusher where it gets processed into the mineral and turned
into a gold site. Uh here you can see uh what they do once that happens is they they put it into these one ton bags of concentrate and these bags uh will eventually make it on their way onto this uh this uh one of the trucks that takes it out uh and is sold uh to uh in our case to ocean partners. Uh and what was uh wonderful about that is that we get paid instantly. So over those four months, you can see here, you know, we got paid uh roughly uh 155,000 first, another 431,000, another 370,000, another 700. So all combined
about $1.7 million uh was paid uh in, you know, uh to us in that with that very small amount. Uh and back then, gold was only at about 1,800 uh gold. So it was pretty exciting to actually feel in real time uh what an operation uh feels like and how we can uh get paid uh in less than 30 days. Um so currently uh this is another business decision, you know, that I made. Um we have a path that I'm going to show you in a minute, a clear path to a million plus ounces, but the starting resource that we have
right now is 218,000 ounces in the measured and indicated like categories. That gives us a 15-year mine life. Now, the reason that's important is because, you know, a couple years ago, you know, in my career, I've raised millions and millions of dollars, and I certainly could have raised more money in the last couple years. But the reason I decided not to do that is because, you know, we would have like a billion shares out, right? Unless you're Australian, you know, you don't particularly like that.
North Americans don't like that. They want to see a much tighter share structure. So the plan from the very beginning was get a starter resource which is what we have here of 218,000 ounces then take the cash flow once we get into into production and then follow up on all the drilling that we did so that we can increase the the the resource to a much much better uh bigger uh number and of course extend the mine life. So you can see here the 218,000 ounces uh in the measured indicated and you can see the the grades uh 10.32 in
the measured 8.15 in the indicated which gives us you know roughly a a 9 g uh per ton and you can see at the bottom uh uh here but right that we're using a 3 12 gram per ton cutoff so fairly high uh cutoff which uh certainly we'll be re-evaluating uh given these uh given these prices. You can see here our our mine plant. So currently we have a 15year uh mine plan. Here's the first five that we've submitted to the government. You can see the top left here. This is what the current workings
look like. And then you can see here uh as we progress to year 1, year 2, three, four, and five, how we're going to mine uh uh uh uh you know, the uh the structure here. I then took, you know, all my all my costs and I put it into into a into a spreadsheet. And uh here you can see I created a little sensitivity uh chart for you to sh to share with you. at 55,000 tons where we're going to start. It's going to start at our first year of our f first full year of production. We expect to be
at 15,000 ounces. And you can see at 2,600 gold, we're going to generate just just shy of $55 million in in in revenue. If you look at the the current prices, of course, I mean, it's just insane. It's like $70 million. But we're but I'm just focused on the on the base case at $2,600 gold. Uh the revenue is pretty pretty significant. Uh as we move up next year, our plan is to get to 75,000 tons. And you can see we'll be at roughly 20,000 ounces and again at 2,600 uh gold. You know, we're looking at
north of $70 million uh in uh in revenue. So very very uh uh important time to be getting into production. We couldn't have uh uh you know hit a better time. I it's just incredible what's happening you know with the prices of gold right now. So that's that's our base, right? So there's really there's really three parts to our story, right? Part number one is what I just showed you which is production. we are near-term and you know people often ask me well that's great that you got
the mining permit so what do you need another 20 30 $40 $50 million to put into production no we have the capital that we that's required and that's why we are expecting to be in production in the next 60 days our team as we speak is up at the mine site and is doing the last preparatory works uh work to get this into production and we fully expected to be uh there this summer uh our official uh opening is July 9th and we'll do a little bit of pre-development work and then we'll uh we'll be actually
shipping or shipping mineralized material out to um Nickeola for processing. So the first part is is is is the production and that we're fully uh cached up and uh don't require any any uh capital at this moment to actually get into to production. The second part of our story is I'm going to show you is our path to a million ounces. As I mentioned, we have our starter resource. Well, how do we increase that now? Right? So the second part of the story is the path to a million ounces. So here you can see
again the dark area which is our our property. It's 22,000 hectares. This is the road from Smithers that runs right through our property. And the bottom leftand corner where you see this this square this bottom square that's where all the focus is. That's only that's less than 10% of the property. The rest of the property hasn't even been touched yet. Now we did do uh some geoysics. We flew the area and I'll share with you in a second. You'll see the whole thing just lit up and many people were just
amazed and said you know how come we never heard about this property? How come we never knew about this project? Well, of course, it was in private hands for many many years and they had no interest in in going public. So, it was completely under the radar. So, if we take a look at this bottom left corner, this uh this uh square and we go to the next screen here, this is now the enlargement of that bottom leftand corner. And you can see here the diamond in the middle uh that's where the the
current portal is. The solid line is is the current resource of 218,000 ounces. The dash line here is drilling that we've done uh in in 21, 2022, 23. Uh we did uh over 50,000 meters of drilling in and around uh this area here. Uh there's also 15 other veins. You can see here these lines here. There's other 15 other veins in and around immediate of the immediate area of the of the current mine of the current boulder vein. But our focus has been strictly on this boulder vein. So if we take a look at
now uh again the the the diamond is is is the portal the solid line is the is is the current resource of 218 the dash line is is is some of the drilling that we did. If we go to the the the next screen here, hang on it. Next here on the right hand side, you can see that's the solid line. That's the current resource that we have. On the left hand side was the dash line that I just showed you. And you can see the drilling that we did. All of these lines, these vertical lines, you can see that's the
drilling. It's all mineralized. So, all we need to do now is infill this, right? We infill drill this every 25 or so meters. And we'll it'll look like what we have on the right hand side here. And that's how we grow the uh the the resource there. And then we also went uh 150 m below the known resource. You can see down here and you can see at the on the right here uh over 3 m of 18 over 18 grams a ton. So it was very exciting because not only uh does the does the grade get not only is it open to the
east and the west but as we go deeper the grades are getting uh higher and uh what also got my technical team very excited is that the copper numbers were increasing which seems to indicate possibly that we're getting closer to the source. So, you know, it it it's just a just very very robust results here. And you can see here some other results here. Double digit uh gold uh anywhere from 4 m to 7 m. Uh you know, again, great numbers throughout. Um then if you take a look uh at this screen
here, you can see uh here's again the the the main boulder vein. Uh what's the what's what's beyond that? Right. Well, look at this on the right hand side here. this shadow here. This looks like a clear extension of this vein here. So, that'll require some follow-up uh drilling that we plan to be doing uh uh you know very very soon here. Um and then then if you then if we plot all the um uh some of the drill holes that I just showed you, you can see uh and this slide here, the dark gray area is the is
the current 218,000 ounces uh in our measure indicated. This here, the white here is the current uh the current uh mine. So, you can see this is what we're going to mine out. And then the white area here, uh you can see all the different pierce points, the drill holes here. Between this white area and this dark gray area, we believe we have a million ounces. There you can see the dark gray is 530 m wide by 200 uh m uh deep here. So, the white obviously is much larger. So, combine the white with
the dark gray and we believe that we have a million ounces just sitting. And remember, I'm still only talking about just the one vein, the boulder vein. And then, of course, the blue here is the blue sky. Uh, as we get deeper, uh, as we extend this further, where does it go? Right? Uh, you know, we'll see where. But certainly, we're very excited. So, I told you there's three parts of the story. Number one was the the near-term uh uh production capability, and by near-term, of course,
I mean here this summer. Uh, and the number two, the path to a million plus houses, which I've just showed you here. And by the way, this has all been news released. You can uh go back to some of our news releases and you'll see uh all the the various drill results that we've uh that we've uh uh uh you know, put in the public domain uh that support everything that I'm uh that I'm showing you here right now. Uh and then also, you know, what's beyond that, the the third part of our story, right? What's
what's beyond that that million ounces? Well, when we were drilling here a couple years ago, just to the north of the of the Boulder vein, and again, here's the Boulder vein. You can see all the little blue dots. That's all the drilling that we've done. And then just to the north of it, uh we had a new discovery, and we're very very excited about that. And now it's time to go and, you know, use our cash to follow up on that uh uh drilling along with this extension here that we see here on the
right, the Boulder extension. So, we're we're very excited about that. And then if we take a look at that uh uh on this slide here you can see uh you can see the trend you can see the trend running here uh uh uh north south here and and number five here we we've we've got a number of targets here you can see our two three four this number five is where we want to put our immediate attention to because again if we enlarge in that you can see the buler vein here to the to the to the south here to the bottom
and just north of that that number This looks like a very clear, very strong porefree target. So, we're very, very excited about that and we'll be following up from that. So, you know, there's a lot of blue sky here, right? So, we've got production that we're about to start here this summer. We'll take uh some of that cash flow and we'll put it into infill so that we can grow that 218,000 ounces uh to a million plus that we believe that's there. All high grade. We believe in fact the the the
vein that's right next to it uh we believe uh is uh uh that the numbers show are showing us at 14 grams a ton. So we're we're excited about you know uh expanding into that. So uh so uh and the third part of course is is this blue sky and following up in these targets and in the new discoveries that we had. Um and then the last piece that I'll talk about is how do we you know grow uh bigger? How do we how do we make sure that the project has uh uh is sustainable? And part of that is, you know, the our
relationships uh with the the Lake Be Nation. Um you know, it's it's very very important uh in Canada and particularly in BC, you know, to to make sure that you have a complete support uh from the indigenous groups that you're working with. We work with a Lake Bin Nation Nation, just a wonderful uh group of people. And one of the things that we did early on is to learn a little bit about more about their culture. And one of the things they they talk about is yintenta. And yinta effectively means,
you know, be with the be one with the land, respect the land. And by learning that philosophy, we were like, okay, well, how do we uh implement that? How do we make sure that every day we are thinking about the yinta? you know, any business that you want to be in, you want to make sure that you keep it clean, you keep it you you you you respect it, you you you make sure that you don't you don't violate uh uh any principles, you know, that would hurt that that business. And this is uh you
know, mining exploration is should be no different. So to to make sure that Yinta was constantly top of mind, what we did is we hired a local artist, Reise Nichols, you'll see here, and we had her make these giant murals that reflected something about the Lake Babin in culture. And we had these framed as you can see here in this slide. We had these framed and then we took them and we put them in various different parts of the site. So here you're seeing the entrance of the mine site and you see the
heredity chiefs there when they came out. I mean they were just completely in awe. They were completely uh in disbelief and so thankful. They said that this is incredible that you guys are consciously thinking about this. We took various uh images and we put them in in in on the different buildings. So here's our water treatment building and you can see here the image is different. So we took different images and put them in different buildings. And the idea behind that would be is to make sure
that we are constantly remembering and thinking about the yenta every single day uh and and to respect the land. And lastly, I mean here's our share structure. You can uh uh we have some pretty strong shareholders. Crescat Capital, which I talked about earlier, uh they are roughly 10% now our our cap table. They've been involved with us for roughly three years. They've been involved in almost every financing. They've been tremendous supporters and really believe in the project. Phoenix
Gold Fund uh based out of Koala Lumpur uh they're about 6% of our cap table now. Once again been great supporters and have been uh see the vision you know that we have uh uh and have been involved for some time. And then Nicola, our our toll mill partner, um gave us a a tremendous thumbs up when they came uh last year to take a look at the mine along with uh one of their directors who was an was an engineer put many mines into production and uh really really liked the project. In fact, loved it so
much that they they invested a million dollars into the company and now own about 6% of of the company. In fact, Peter Espig uh uh himself the president of the company has participated in a number of financings. It just gives us a tremendous uh confidence that people who are in the know certainly people who are a lot more smarter than I am in the mining industry who are in the know have come and invested in this project that's giving that's giving us further validation. And then uh myself, my
family and a couple of key founding shareholders, right? We have put a couple million dollars into the company ourselves and own about 14% and the rest is all all retail. So fairly uh spread out. Um so there you have it. That's uh pretty much uh our our story and uh I'm happy to answer any and all questions at this point. Thank you Ra for that uh presentation and we have do we do have some questions coming in already. Um I think first question you've you've mentioned with full funding secured and production
anticipated to commence by December 2025. What are some of the critical operational milestones that you're focused on achieving between now and uh the start of production? Sorry, did you say December 2025? Because sorry, summer 2021. Yes. Yeah. Yeah. Don't put I've been waiting a long time. So don't make us wait any further. Um no, we'll be in operation here this summer. Um uh the key milestone is our water treatment plant. We are uh right now just putting the final touches on that uh to finish
that up and uh getting ready to to start that and testing that. So that really is the key milestone which we expect to have done here this month. So by the end of the month that water treatment plant will be up and running and once that is the case really the next step is really to do a little bit of development. my team has asked you know one of the things that I've asked the the people around me my technical team is um you know what can go wrong here right you know you know I'm I'm I'm uh I'm a very
conservative individual so I wanted to from a business perspective always understand you know what how do we derisk d-risk d-risk this continue to derisk this and one of the things they told me is well it would be great if we could do a little bit more development so I've said no problem tell me what you need so we're going to do is we're going to spend about 6 weeks and uh do a little bit more pre-development uh development so that we can have multiple phases to work on. U so that's really
the two next two key things right we'll we'll finish the water treatment plant do a little bit of development and uh later this summer start shipping mineralized material out to Nicola and uh wait for the checks to arrive and we do have a question here about the Nicola mill. What is the transportation cost per ton for uh to go to to Nicola's mill? uh you know some of those are sort of confidential internal numbers but uh how I can say that is that basically um it's industry standards all right the the
mill is charging us industry standard rates uh there so there's nothing out of the ordinary out of that I'm not quite sure how how more I can answer that question without disclosing you know what I what I can't what I really can't and then follow up to that do they have as you know one attendee saying is that he understands Nicolola's is already milling other ores. Um do you do they have enough capacity and are permitted to process more when you're going to 20k tons per year? Yeah, absolutely. The uh
the uh Nicola just actually started processing some of their ore and we've been in communication, you know, with them to make sure that there's there's no hiccups and uh there there are none. Now, we have a long-term milling agreement with them and uh Peter has assured me that uh there's no issues there. we are their priority and uh well remember they're also invested they're own 6% of our company and he himself is invested in us so I think we're I think we're in good shape but yeah we are
definitely their priority and they definitely have capacity to uh handle uh uh our material as well as their uh and they're also looking at expanding so I'm not that's not one of the things that's keeping me up at night at all and with regards to your uh relations with the first nations people uh could you give us more one of the questions is asking to give us more details on the companies on your relationship with the local communities and the first nations provide maybe give us some insights on
sort of know what worked in terms of building that relationship what are the key learnings that you've had well I think it's transparency and honesty right I mean I think we started uh when we were started with them you know the first step was to uh listen to the concerns right I mean it's not my job to go and lecture to anybody or tell them this is what we're going to So, you know, we our approach was simply to listen, you know, what are your concerns? how can we be partners um in
this and you know we right from the get-go uh acknowledge that you know we understand their rights and we understand um you know uh we want to understand you know what what would they like to see from us um and that really I think paid uh dividends and also just being conscious of you know what is it that we would like if we were on the other side uh what would we like to see you know one of the most important aspect of this is water, right? I mean, uh, salmon and fishing is more than just food. It's a way of life, you know, for
them, right? So, uh, we were very very concerned of that. So, I'll give you one example. So, we didn't wait to see what were the requirements for testing for us. So, for example, on one stream if we were we were required to do five different sites to test and when we came back and discussed with our team, we felt there should we should be testing at nine sites. So we did, you know, so you know, when they learned of of that, you know, they were very pleased that, oh, you you did this on your own without
somebody putting a gun to your head and saying to you, no, you have to do this. So I think when you approach things in an honest and transparent uh uh manner uh people see that they see the the genuiness and they see the caring and and that was a you know and then similar to what I just showed you earlier in our presentation about respecting the you know the yinta all those things uh uh you know together uh you know is what really what built the relationship. Another question, uh, in your historical
database of drilling, do you see variations in the gold grade from vein to vein? Do you think the grade is consistent at the boulder vein? And what about the other intersections you had always in terms of grade and gold and silver? Yeah, the the most of our focus so far has been on the boulder vein, right? We've done very little work on the on the other veins, although there is historical data. Niranda, for example, just south of the main boulder vein, uh took out about 20,000 ounces and what it looks like with double digit
numbers, 20 grams uh a ton plus. So very very high grade. Um but on the buler vein, we're seeing a lot of consistency. you know, the vein is about 2 and 1/2 uh to about 7 m u but averages around 2 and 1/2 mters and doesn't pinch and swell much and and we've seen some pretty good uh uh uh consistency uh in in you know we've drilled about 50,000 meters in and around that area. So, you know, we have enough data to give us uh u certainly confidence in our numbers. Another question. If you have the funds to start
mining soon, why do you need more shareholders, please? Oh, well, you always need shareholders. So, if the if the question is why am I doing this presentation? Um, you know, you always need more shareholders, but that doesn't mean you're going to raise money. Um, you need uh you constantly my my job as you know, I learned this from Robert Mchuan, you know, one of the one of the greatest uh you know, who built one of the greatest mining companies in in Canada. I have heard him talk one time and he says you have to be
constantly talking your story. You have to be constantly telling your story to the public. Um because that's how you grow, right? So the purpose of this uh webinar is not to ask people to uh for money because we're not raising any money but it is to get it on their radar. It is to uh to make sure that they're aware of who we are because as we build the company um you know you're going to need you want more and more people talking about it. You know, people forget that every great mining
company started with one mine. You know, in 1957, Agniko started with one mine and today they have 11 and uh I don't think they were quiet all that time, right? They were spreading the word. They were telling people and through that uh comes momentum and uh and great things happen. So that's why I'm here. Yeah. I think one of the most you know interesting thing about your mind is you know you are one of a handful of companies that have been managed to get permitting um in the last u permitting
to open a mine you know in the last nine years. Maybe you can share some of the insights or learnings that you've had in terms of the you know how to s like successful permitting and like what are the sorry you know what you did right basically. So to share with that you're trying you're getting me to tell my secrets. I don't want other companies to get permitted here. So as you can share. No, I'm teasing. Look, um it's a tough it's a tough environment. It's uh you
know all the business I've done. I think this is one of the toughest that I've seen that it's a tough environment with uh with because you've got all these government regulations um that in my opinion especially for the smaller mines, you know, are really uh need to be relooked at. And I think the government to their credit is doing some of that now because they're talking about, you know, speeding up some of these some of these processes. So, you know, but it's it's it's difficult. You
you've got you've got uh I think uh ministries that are underst staffed, right? Um and you know, while we were doing this process, we changed six or seven or eight different project coordinators. You know, the lead people who are who are working with us, you know, kept changing. Um so, you know, you got you got people who are constantly on the move. You got people who are you got under uh financed uh you know ministries and then you've got these new agreements. You know we were one of the first ones uh with the with
the uh uh with the lake be nation was it was one of the first agreements in the province that that we had to we had to go by. So nobody knew what was happening. So you had to learn all that. So what did we learn? You know you've got to be very patient. You've got to be very patient. You have to be willing to listen. You know you know uh uh because it it's It's you have to figure out what is important to each uh uh entity that you're talking to whether it's the ministry what's really important to them
right you know with with the lakebin nation or the other indigenous groups you're working with you know what really motivates them it's not necessarily money right so you know there's a lot of lessons you know that we learned um but I think the the the greatest one I think was you know patience listening and transparency. Be upfront and honest and make sure that you want to build a long-term relationship. I think I was I think that's key. Um, another question. Would it be financially reasonable to build a Blue
Lagoon meal? Oh, absolutely. Um, you know, uh, we're going to start in fact that process very soon to to go ahead and and uh and start that peritting process. why we didn't do it right now is because it would have taken me and you know who knows how many more years and 40 50 60 more million dollars and the last thing I want to do is miss this goal cycle. So from a business perspective it just made sense to get into production immediately as soon as possible to get and start to cash flow
and then start that process on the side which we intend to do very soon. Uh another question here. Can you talk about uh more about the risk for the for more exploration activities? Um well I'm not sure what they mean by risk. I mean there's always uh risk I suppose but I mean it's derisk because we've done a significant amount of work. Uh we've done you know the geoysics uh uh significant data that's come out of there that's very very promising. So we know where the targets are that we can
uh we can go after um the the 50,000 mters that drilling that we talked about uh has clearly defined uh we know where we need to go infill to increase the the resource. So I think the the the short term is fairly drisk now the outside of that sort of 10% of the property you know where we where we go uh there's always risk. Now we have done almost 5,000 soil samples. So there's a lot of targets. Uh so I I think it'll be quite a while before we see before I see anyways some significant risk of not
hitting mineralization because from what the data that we've had so far we have many many targets to to uh go after and follow up on. Another question here about the your relationship with the Lake Bambi Nation. Can you speak about the benefit sharing mechanisms agreed upon with Lake? Yeah, so we have a we have an agreement uh with the lake be nation that uh talks about uh you know job opportunities and training uh contract opportunities. Um so all of those are are open and available to them and my approach again
has been very very straightforward and transparent. I've I've I've you know communicated to them that I have absolutely no issues of hiring um any anyone from uh you know the Lake Bean nation as long as they can meet or exceed the qualifications. you know mining is a dangerous business right we've got to you know safety is number one so as long as that people can perform uh the jobs uh the operations you know we have abs I have zero uh hesitancy in bringing them so so they'll
be there so so there's already we're speaking to them and uh as we're getting ready so there's job opportunities um there's contract opportunities that we're that we're speaking to them about now they have to have the capacity to of course fill those roles in in some of those areas you know they don't but we're also willing to train uh one of the you know we have uh we're setting up five scholarships uh you know for for for young people and we're also offering
a we're also in the process of offering uh a training uh for people who want to come you know what an opportunity to actually learn from some very very experienced people somebody who wants to be in the mining business learn underground mining uh so we've already spoken to our contractors about that and he he said he'd be delighted so there's all sorts of opportunities it's just going to depend now on what the ability what the what what the capacity the Lake Bean Nation people have cuz remember you
know it's a fairly small uh community you know so you've got your elderly you've got your children and then you got this you know small group of people who potentially can work or or have business opportunities but but there certainly will certainly make them available 100%. I'm going to combine two questions here. What is your approximate cost per ounce? And with revenue 7 of $72 million, how much net earning are you looking at? Well, that's a a question unfortunately I'm not not allowed to answer because,
you know, we don't have a a a pea. We don't have any economic uh studies done on this. So, my hands are kind of tied on that. We have, of course, internal numbers um that uh that show us where we can go, but I can't really uh talk about that publicly. But, you know what? It's not that difficult to figure out if I can say uh you know we're not different than you know most uh mining companies. So you know you can see the revenue and you can kind of determine uh what the what the costs potentially are going to
be. Um but you know what and also if I may say we're only months away uh as soon as we start mining of course we'll be releasing those numbers uh publicly in our in our disclosures at which point you know it'll I'll have a much more ability to talk to to to speak about that. But having said that, let me just uh assure you that uh we're not uh aggressively going after this and I'm not sitting here talking to you folks here uh on on here unless we thought the numbers were uh good.
You see the smile on my face. I'm smiling for a reason. It says all that you need to share. Um so an exploration question. What method contributed to determining the extension of veins under the surface? And is the area complex in structural geology? Boy, that's a question really for my my technical team. I'm not a technical person. I mean, is the is the is the is the geology complex? Yeah, they tell me that it is. This is a structurally hosted uh quartz veins that we're talking about. So, yeah, they tell me
that the geology is a little bit tough, but uh I don't know. So far they haven't, you know, complained a whole lot and they've certainly uh shown some uh some significant uh results. Um but I'm happy for any technical questions and specific questions like that. I'm happy to do any follow-up uh if any of the uh viewers want to email me. If you go to our website blue lleonresources.com and you uh email uh there, it'll come to me and I'm happy to do a follow-up with our technical team
or answer any questions via email, technical questions. uh and get those to you just so that I get it right and not give you the wrong information. Uh we do have some other technical questions here which I can just send to you uh later on. Okay. Um another question, does the company have any loans outstanding? Uh nothing significant. We have no short-term loans. We have a we have a small amount of uh loans that we inherited uh when we bought the company and those are to be paid over uh almost 3 years after commen uh after the uh com
commencement of production. They're all disclosed in our in our in our financials. It's nothing significant and it's over three years. Uh every quarter we'll pay out a little bit. Another question. Are you open for capital investment from another mining company? Um something strategic. I mean if if it uh uh if if something strategic comes along um you know my job is to make sure that we explore every opportunity take a look at every opportunity. So um absolutely I would be open if it makes sense. if it makes
sense, you know, my job is to to enhance and grow the shareholder value and and if if that uh strategic uh alliance or investment makes sense, absolutely we would look at it. Uh there's another question here. This uh fellow is from um Sierra Leone, West Africa. Is it possible to partner up for gold business in Sierra Leone? Is it possible to be your gold buying agent for Sierra Leon? No, we we are our focus is strictly here uh in BC and we want to we want to stick to that. Uh certainly we'll look at uh
you know potential other projects in in North America if that makes sense for the company to grow. I mean but you know we've got so much work just on this project alone to do and to grow that it probably doesn't make sense for us to to do anything else but and certainly not in Africa and in terms of buying no because we have an agreement with Nicola and they for they further have an agreement with ocean partners to take the uh to take the concentrates so I don't see any opportunity there
unfortunately. What are the first three uses of foreseen cash income? The first three uses what are we going to do with it? Yeah. Um well certainly the the the first two are are really easy. The first first is we're going to use some of that cash to do infill drilling because we want to grow that resource, right? We want to make sure that this mine is in production for you know decades and decades to come. So that'll be the infill uh drilling to increase the resource to move it towards that 1 million ounce that we believe we
have there. The second will be exploration drilling. You know the blue sky, right? uh um the market always likes to see, you know, that hey, this is a there's a there's a there's a bigger find here and we believe that we have numerous targets um that are very very compelling. So, we'll take some of that cash and then we'll put it into that. And then the third part, you know, we we'll have to evaluate as we go along. I mean, certainly I'm I'm I'm I'm open to taking a look at uh uh you know,
possibly a small dividend depending on the cash and bringing the price of gold. I'm certainly looking at opening uh looking at uh uh maybe launching an issuer bid that's to support the stock and may buy back some of the stock which we're allowed to do as a public company to support the stock and and fend off some of these uh uh algorithms you know etc. So that we're going to have to kind of evaluate um as we go along. Another question are you planning to wait sorry it disappeared.
Are you planning to be listed on TSX for more public exposure? Yeah, I mean we are looking at that and uh there are discussions and and and definitely there's a lot of people who who feel that we should move to the TSX and that is certainly certainly something that we're we're looking we're looking at. Um I don't know how much more exposure it gives gives you. I mean I'm uh I I like the CSC. I've worked with them for many many years. I brought uh in fact two of the biggest deals
outside of the mining space. to the biggest deals ever in the history of the CSSE. Uh I took them public on the CSC. So there was plenty of exposure. In fact, in one company, we did a hundred million $100 million of volume in one day, right? So I think it's there. But I think there is value in in the in the TSX as the as the company grows to European investors uh you know often like that and Asian investors like that. So we are looking at that and I think you're you're going to uh probably see
something here uh in the near future. So with um you know with the fully funded mining operations, what are your key strategies for maintaining cost efficiencies and optimizing operational expenditures as you transition into um active production? Well, you know, that's really comes down to the experience of the people that we have have around us, right? That's why, you know, we brought in some very very experienced people, right? Steve Cuddler from uh Roughstock Mining who I mentioned earlier who's you know who are
one of the contractors at for Stillwater extremely experienced have worked in dozens and dozens of mines um as uh as uh as uh supervisors, managers, operators, contractors. So they know uh you know Peter Bojos who's been involved as I mentioned in you know over over 80 countries in 24 plus you know mine operations. These are very very experienced people who are sitting down with me to help me not reinvent the wheel, right? There's nothing new that that we're doing here. So, you know,
it's really going to come down to to people and to uh looking at our uh our our situation exactly on a on a day-to-day, week to week, monthtomonth, quarter to quarter basis to make sure that uh we are keeping everything in in control. And you know what? Look uh I'm Indian, okay? So I'm cheap by nature. So I watch every penny like a hawk. And fortunately my train my team has uh uh really tuned to that. So we are all very very conscious of uh every single penny you know that we spend and have plans to
uh uh constantly monitor that. you know, uh Giannis uh Cidtos, who's uh one of our adviserss, um very very uh uh familiar with uh with with moving from exploration to to development to uh to production who's heading our mining committee. So, you know, people like that uh you know, he took a company uh called Gold Source who had a couple hundred thousand ounces to 2 million ounces uh and sold it. So when you have the right people, the right team around you, um, you know, cost controls, uh,
become much much easier because they've been there, they've seen the mistakes and they help you not repeat those same mistakes. Another question here. What is the possibility of offering dividends to shareholders in the future? Right. I I think it's a very real possibility. I think we have to uh as I talked about I mean but I think we have to evaluate you know and my job one of my one of my you know part of my job is to evaluate you know what is the best going to be the best use of that cash that we that we
start to accumulate and uh if we feel that uh you know dividend is part of that that best uh u uh increases shareholder value then absolutely we'll we'll do that we're open to that. Um, another question. Are you planning to release an updated technical report? Yes. Yes, we will be. We just haven't done that yet. Again, you know, uh, I've been on a on a sort of a cost-saving mode and and and, you know, that's another reason why we didn't increase the resource because, again, as I
mentioned earlier, if we had raised more money, the share structure would have, you know, would have increased, you know, would have been, I think, undesirable. Uh, and I don't think the market would have cared. I don't think the market would have cared if we went from 218 to 518, 48, 618. um u you know but we we would have increased a lot of our our share count so um yeah I we will release so now uh that as we get into production uh in fact uh you know the drilling that we've did a couple years
ago is not included in the in the current technical report so we will definitely update that here uh later this year um so how soon after production starts do you plan to resume uh or expand exploration drilling in how would to balance ongoing mining operations with continuing exploration efforts. Well, I I think it'll be a percentage uh of the cash that we have uh as we evaluate the opportunities. So, yeah, the the the the drilling that we will do will most likely start early next year. Uh
because, you know, we want to get the first uh you know, five 6 months under our belt, just nice, safe, smooth operation, you know, that we want to that we want to uh you know, kick off. uh and then uh early next year as we have uh uh accumulated some cash is is when we'll start uh you know with uh most likely with the infill first and then start with the follow-up exploration uh uh drilling. Uh another question, you're quite an experienced businessman from other industries. What drew you to mining in
in this mine in particular? Uh well, you know, after 2008 and 9, um my businesses were suffering just like everybody else. As you recall, the financial sector, I mean, it was just mayhem. I mean, look like the world was collapsing. Nobody no one had ever seen anything like that in our generation anyways, right? Um so I my mentor a very good friend of mine who had made u most of his early money in mining um suggested that I leave my private world and come into his exciting world of the capital markets. Um so I was looking for
a change that really is really what uh drew me in here. I wasn't had to be mining. If he had suggested something else I probably would have gone into something else. But because his experience was you know one of his first successes and he was very successful one of his first successes was selling Desert Sun to Yamana back in I think I believe in the 80s for $750 million. So you know these they had some very very you know big wins. So he brought me in in into this sector in uh 2011 I put seven figures by the way in into the
sector and by 2012 it were like three figures. It was like the the whole mining sector collapsed and I'm like wow what a nice friend. What did you get me into? But you know, adversity teaches you, right? Uh I'm a big boy. So I took over these mining, you know, companies and started started learning. Um and then it just became a challenge. It just became a challenge. Uh you know, because they kept saying every year, look, it's going to turn. It's going to turn 13, 14, 15, 16, 17, it wasn't turning. You
know, the mining sector just wasn't turning. And that's when I pivoted to another industry. And you know, because you have to do that. You have to as an entrepreneur, as a businessman, I make I couldn't wait forever, right? right? I mean, if I was a geologist or a mining engineer, I guess perhaps I would have stuck into that because that's my job, but I'm not that. So, I started looking and I started looking to see what other industries were working and uh the hottest industry at the time I picked
and uh took two companies uh of in that industry public. The first one raised $520 million, was a $6 billion RTO. The stock went to $20. Uh the second one uh was a $300 million raise and and was sold a couple years ago for 2.1 billion. Um you know again the stock went to double digits. So you know you you know you you you kind of look at things and you you pivot where you need to do but but uh in 2019 I decided to come back into this because I kind of got the you know the bug right mining is exciting and uh and
uh gold in particular uh you know and because I'm Indian my culture loves gold uh whatever everything I was reading in the macro picture back then you know told me that gold has to take off at some point and uh to answer why this project. I looked at over 200 projects and when I looked at this one my one of my main criteria was can I get it permitted and cash flowing because my training in as a business person is that and those years of 20 you know 13 and 14 15 16 17 all those lean years what I
learned is that all these companies they raise money to explore they raise money to explore and hardly any of them ever get into cash flow and that's not what I wanted to do I wanted to get into cash flow and this project was one that was one major tick mark that I saw that I knew I could get this permitted and into production. So that here we are. We have time for two more questions. Um I wanted to ask you what are some of the operational or production milestones that you're looking at that will define
success in the first year of your uh gold uh dome mountain operation? Um well you know we have uh our plan you know dictates that we do 15,000 ounces uh the first year right so a full operation now we're going to start here in the summer and the first sort of 2 or 3 4 months are going to be kind of pre-development development and we'll get a you know a few hundred ounces but once we start which I expect to be that to be fully uh later this year then our first year I expect to be 15,000 ounces
so that will will that's one of the milestones for me personally to say okay you know uh you know we succeeded because that's what we did we said we were going to do that and uh and we just did and then the second one will be moving to the next uh the next vein you know we have a vein that's 90 m away that we plan to do put a decline in that one is like grades at 14 gram a ton and uh and and that's going to help us move to to 20,000 ounces so the next will be to see okay we can actually move this
now up to 20,000 and ounces. So, those will be the first couple of uh milestones I think that uh that we'll see that'll uh give us confidence that we're succeeding. And looking beyond that initial uh production phase, what is Blue Lagoon Resources long-term vision for the Dough Mountain Gold project? I understand you mentioned, you know, you have 15-year mine life for the 200,000 ounces. Like, what's the long-term vision for that mine? Well, that 15 year mine life, of course, is if we do nothing else, right?
uh that 218,000 ounces. If we do nothing else, uh of course that's not our plan. We're going to do something and we're going to increase that. So, this will be in in production for a very long time. Well, look, that's a that's a great question. It's a difficult question to answer because it really is going to depend on on the opportunities that are presented to us. So, well, let's look at that. What are the opportunity? Well, number one can be take the cash flow and just drill drill drill, right? just
drill and and and see uh how fast and how big we can make this uh this project because it looks like it's very robust. So that's number one. Number two is, you know, is there a uh an acquisition opportunity? I already have a couple of companies talking to me uh to say, hey, you know, maybe it would just make sense to to uh to merge or or you buy us because there are other companies that are have great projects um but don't have the money. you know, capital is still very very difficult to raise and
uh in this environment. So, you know, maybe that's an a play here that we know that we that we uh that we buy something and we grow from you know, 20 to to 40 50 60,000 ounces and beyond. You know, that would be a a good strategy. Uh or, you know, is it a is it an acquisition for us? Now, personally, I don't think, you know, I'm not interested in selling out because it's just too cheap. We're just too we're we're just getting that we're getting started. So you know the
answer that I'm trying to provide you here is that it really is going to depend as a as a good business person I think my job is to evaluate all the opportunities as they are presented at the time and then make a decision on what makes sense at that time that will help to build shareholder value and that could be continue to expand continue to infill when I say expand continue to expand our exploration expand our resource look at uh acquisition opportunities uh or or or merging opportunities. And I
I think there's going to be plenty I know of of numerous companies uh I I can think of several just off the top of my head that would be great opportunities for us at the right time here in the next 12 to 24 months of options for sure. As we wrap up, maybe Rana if you want to provide uh you know our our attendees some of the key takeaways like the key messages you want to convey to our attendees today as we wrap up. Sure. Thank you. Well, look, um I think the key message here is that if you are
interested in having gold exposure, um and you already own some physical gold and you know, but of course the upside on that is limited. That's more of a of a of a of a safety net that you that you're building. Uh if you are interested in getting exposure in a a a solid opportunity exploration company moving into production, then I think that the Blue Lagoon Resources is certainly something that you want to seriously look at. Take a uh beyond this this uh this webinar. I think it's something that you want to take a
serious look at because there are not many companies. I cannot think of many companies. Well, you know, I I spoke at an industry event not too long ago and there was 200 people in the room and I asked them please is there anyone who can raise their hand uh who can think of uh the last comp exploration company that went into into production and not one person this was two two months ago not one person could put up their hand. So, you know, we are in a very very rare situation where because of the price of
gold, we are at a perfect perfect timing. So, if you're looking for that exposure to a company that is about to go into production in a very very hot gold market that's going to produce cash flow, then I don't know of any other better opportunity than Blue Lagoon Resources. So, I would highly encourage you to to uh take a look at that and uh happy to ask uh as I said, email me. I'm I'm always available. uh happy to always speak to shareholders and answer any and all questions uh uh that they have.
We'll leave it at that. Thank you again, Rana, for presenting your company today and for answering all the questions. Thank you for this opportunity. Thanks everyone for joining us and enjoy the rest of your day.
Post a Comment