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West Red Lake Finds More High-Grade Gold PFS Coming Soon · Financial Survival Network

• 0:00
  Speaker 1: We've raised one hundred million dollars in the last year,
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  Speaker 1: and we've spent a lot of that money on the
• 0:05
  Speaker 1: mind site doing the projects that were needed to get
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  Speaker 1: this thing ready for restart.
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  Speaker 2: Capex is going to.
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  Speaker 1: Be pretty small because our predecessor company spent three hundred
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  Speaker 1: and fifty million and we've already spented a big chunk
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  Speaker 1: of money in the last year. There's just not that
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  Speaker 1: much money left to spend, so our capex is going
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  Speaker 1: to be very small, which, by the nature of how
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  Speaker 1: it's calculated, the capex is in the denominator, should mean
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  Speaker 1: that the rate of return should look very nice for
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  Speaker 1: this operation.
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  Speaker 2: The Financial Survival Network.
• 0:36
  Speaker 3: Now more than network.
• 0:39
  Speaker 2: The Financial Survival Network.
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  Speaker 3: And welcome. This is Financial Survival Network. I'm your host,
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  Speaker 3: Carrie Lutz. We are sitting down for a sponsor update
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  Speaker 3: with Gwen Preston, VP Investor Relations of West red Lake
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  Speaker 3: Gold Mines. And Well, when I was talking to you
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  Speaker 3: earlier pre call here like the amount of newsflow that
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  Speaker 3: West red Lake as it's kind of the envy of
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  Speaker 3: the industry here, and it's not just fluff. We're talking
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  Speaker 3: consistently impressive drill results here, So I know you're the
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  Speaker 3: source here or the major source of what's down the
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  Speaker 3: pike here.
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  Speaker 2: Absolutely, yeah, we are blessed.
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  Speaker 1: For sure to be able to put out so much news,
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  Speaker 1: But of course it's the nature of the beast.
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  Speaker 2: The beast being that we're pushing this asset.
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  Speaker 1: As quickly as we possibly can towards restart, and so
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  Speaker 1: that requires so many layers of activity at the site,
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  Speaker 1: and so those all generate news. Right on the drilling front,
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  Speaker 1: we're really pleased on i'd say, sort of, I want
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  Speaker 1: to say pleased in two ways. We're really pleased that
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  Speaker 1: the market seems to be really noticing our drill results,
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  Speaker 1: which often doesn't happen when it's just infill drilling. But
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  Speaker 1: this is really important in fil drilling. Infil drilling always is,
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  Speaker 1: i should say, but this is infield drilling to define,
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  Speaker 1: you know, minable inventory, to sort of literally create our
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  Speaker 1: stop book, which is like every single spot in the
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  Speaker 1: mind that we are going to extract when we restart.
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  Speaker 2: This mine next year.
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  Speaker 1: For the first several years of operation, and so you've
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  Speaker 1: got to do really tight space drilling and have confidence.
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  Speaker 1: And the confidence piece is what really matters there, because
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  Speaker 1: of course, the history of this asset means that some
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  Speaker 1: people have questions about the resource, and our team has,
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  Speaker 1: through all the work they've done, you know, interpreting the
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  Speaker 1: geology and refining that resource model, the internal resource model
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  Speaker 1: that we have, the drill hits are really consistent and
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  Speaker 1: they're really phenomenal. I mean, the last set of results
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  Speaker 1: that we had some from the main Austin zone included
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  Speaker 1: some uber high grade stuff one hundred and six grams
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  Speaker 1: per ten gold over a meter. Also some hits from
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  Speaker 1: over at the McVay zone, which is like the near
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  Speaker 1: surface geologically more complicated zone. Took our time before going
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  Speaker 1: there to really understand where we wanted to target, and
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  Speaker 1: have been getting some really strong results from there too. Also, ironically,
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  Speaker 1: the same number one hundred and seven grams per time
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  Speaker 1: gold over a one meter hit over at the Mcvazon, So,
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  Speaker 1: I mean, we're really really pleased with how the geologic
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  Speaker 1: team is able to produce these results, and with the
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  Speaker 1: fact that the market is acknowledging, Wow, you guys are
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  Speaker 1: churning out high gride hits consistently.
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  Speaker 2: Your hits are happening within the block model.
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  Speaker 1: That is your resource, So that's really increasing confidence in
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  Speaker 1: this deposit. As we push this thing towards restart next year.
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  Speaker 3: And so obviously there's going to be a lot of
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  Speaker 3: news coming and you're drilling consistently regularly, so the results
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  Speaker 3: are going to be coming out, you know, I don't
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  Speaker 3: want to say at a regular interval, but.
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  Speaker 2: Regularly, yeah, I mean I think we should.
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  Speaker 1: It's reasonable to expect infil drill results every couple weeks,
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  Speaker 1: like every three weeks and.
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  Speaker 2: Sort of forever more.
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  Speaker 1: You just don't stop infol drilling at a project like this, right,
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  Speaker 1: That's the nature of a high grade gold deposit. You're
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  Speaker 1: always going to be hammering your resource with info holes
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  Speaker 1: as you continue to create that stopbook for you know,
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  Speaker 1: the months and years ahead. But there's not only going
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  Speaker 1: to drill results. There's also a whole bunch of other
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  Speaker 1: news in the pipeline for sure, because like you say,
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  Speaker 1: as you push a mind towards restart, there's lots of
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  Speaker 1: layers of work going on. So there's lots of projects
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  Speaker 1: underway at the at the mind sight. No, we're doing
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  Speaker 1: a tailing's damn lift which will give us ten years
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  Speaker 1: of mind life at eight hundred tons per day throughput.
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  Speaker 1: We're doing a connection drift to attach the two different
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  Speaker 1: sides of the mine with that's that's a ten million
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  Speaker 1: dollar capital project. We're building a camp, we're building a
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  Speaker 1: mind dry, we're doing a lot of the we're installing
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  Speaker 1: a primary crussure. We've added evaporator fans to increase our
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  Speaker 1: ability to de water the mine. We're doing a lot
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  Speaker 1: of we're doing the work that after a year of
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  Speaker 1: really deeply assessing the amazing infrastructure that existed at this operation,
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  Speaker 1: we really spend our time to assess what was fantastic
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  Speaker 1: about that and what was still needed. So the capital
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  Speaker 1: projects that we're doing are addressing the needs infiel drilling
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  Speaker 1: for sure, and those other things that I mentioned. Those
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  Speaker 1: are all about creating an efficient mind, and efficiency is
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  Speaker 1: the bottom line, you know, cost wise in mining. So
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  Speaker 1: we're doing all these capital projects so that when we
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  Speaker 1: get to that restart decision, when we turn this thing
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  Speaker 1: back on in twenty twenty five, we give ourselves really
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  Speaker 1: good odds of success for Madsen to be the mind
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  Speaker 1: that it has the potential to be.
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  Speaker 3: Wes Redlake's kind of unique in the sector because yeah,
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  Speaker 3: you're exploring, but the bulk of the exploration, or a
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  Speaker 3: lot of it's already been done and you're going to
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  Speaker 3: be producing. So there's not a lot of I would
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  Speaker 3: call choice companies in your position.
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  Speaker 1: Absolutely, I mean, I think you and I chatted about
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  Speaker 1: this for a moment just before the call. But we
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  Speaker 1: had this huge piece of news in the mining stack
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  Speaker 1: in the last little while here right, Osisco Mining being
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  Speaker 1: taken out for over two billion dollars. And that was
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  Speaker 1: a deal to take out a near production asset, right,
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  Speaker 1: a gold project that can be put into production in
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  Speaker 1: this cycle. And so that sparked our attention here in
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  Speaker 1: the office for sure, and I got one or two
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  Speaker 1: banks to send me their lists of takeouts of M
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  Speaker 1: and A activity project or company level in the gold
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  Speaker 1: space for development stage assets, and in twenty I added
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  Speaker 1: it up.
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  Speaker 2: In twenty twenty two, it.
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  Speaker 1: Was one point four billion dollars, in twenty twenty three
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  Speaker 1: it was one point seven billion dollars, and in twenty
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  Speaker 1: twenty four were already at two point four billion dollars
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  Speaker 1: in takeouts of development stage assets in the gold space.
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  Speaker 1: So that's I mean, it's only three years, but it's
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  Speaker 1: a pretty significant trend.
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  Speaker 2: And it makes sense. Right, we had this.
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  Speaker 1: Huge bear market that stopped a lot of projects in
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  Speaker 1: their tracks. So there aren't that many projects that kept
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  Speaker 1: progressing and moving towards the ability to start producing mine
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  Speaker 1: in this site, start producing gold in this cycle. So
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  Speaker 1: how many operations are there that are going to start
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  Speaker 1: producing gold in twenty twenty five? I think the list
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  Speaker 1: is very very short, and so I have no idea
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  Speaker 1: if another company is going to come and get interested
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  Speaker 1: in buying the mats in mind, But if investors are
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  Speaker 1: looking for leverage in a rising gold market, you know,
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  Speaker 1: it's long been understood that new production creates new value.
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  Speaker 1: I mean, new production or new output in any market,
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  Speaker 1: in any industry should create new value for that company,
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  Speaker 1: right and in the gold in the gold market, that
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  Speaker 1: means companies that are significantly increasing their gold ounces, their
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  Speaker 1: gold outs production. And we're going from zero and ideally
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  Speaker 1: we are hopefully we are going to you know this
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  Speaker 1: sixty thousand ounce per year. That's our general target for
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  Speaker 1: production for next year. That's a big that's a big change,
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  Speaker 1: and it has the potential to engender a signal again rewrite,
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  Speaker 1: We'll see how the market reacts to that, but that's
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  Speaker 1: certainly the thesis here, and I think the rarity of
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  Speaker 1: a company putting in putting a new gold line into production.
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  Speaker 1: That's what I really love about the opportunity in West
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  Speaker 1: Red leg Gold right now, and.
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  Speaker 3: It's so rare, especially in these days with the lead
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  Speaker 3: times to building minds, and then, like you said, the
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  Speaker 3: state of the sector with didn't produce a lot of
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  Speaker 3: companies in your position. And more importantly, if somebody does
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  Speaker 3: come knocking, they already know that you're prepared to actually
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  Speaker 3: bring this mind online. So your ability to leverage that
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  Speaker 3: position the optionality is something I think a lot of
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  Speaker 3: people don't really appreciate.
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  Speaker 1: Yeah, and I agree that there's a bit of a
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  Speaker 1: lack of understanding of exactly what you just said.
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  Speaker 2: When's it going to happen? How soon is it going
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  Speaker 2: to happen?
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  Speaker 1: And that's been part of the story. We bought this
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  Speaker 1: asset only just over a year ago, and we have
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  Speaker 1: made we've pushed it forward so quickly that we haven't
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  Speaker 1: been able to produce an official, like compliant mind plan
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  Speaker 1: that we, you know, the regulators let us put out
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  Speaker 1: and talk about. It just takes a long time for
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  Speaker 1: the independent you know, people to produce those studies and
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  Speaker 1: they can only start after we've done a certain amount
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  Speaker 1: of infield drilling and so on and so on. So
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  Speaker 1: the exciting thing though, is that that study is.
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  Speaker 2: Now coming out.
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  Speaker 1: In the next few months, we will issue that pre
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  Speaker 1: feasibility study that lays out in very clear detail what
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  Speaker 1: this mind is going to look like, how much it's operation,
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  Speaker 1: how much acchounce is going to cost to produce, and
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  Speaker 1: therefore you know what the value of this asset should
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  Speaker 1: be if we turn it back on next year. And
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  Speaker 1: I'm optimistic that that study, shining light on the numbers,
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  Speaker 1: you know, giving making solid what has been a bit nebulous,
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  Speaker 1: should help the market understand the value opportunity in West
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  Speaker 1: red leg old. So that's coming up in the next
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  Speaker 1: few months. So it's going to be a really busy
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  Speaker 1: couple of months for newsflow, and I think in what
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  Speaker 1: could well be a pretty phenomenal gold market. I mean,
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  Speaker 1: it's a phenomenal gold market right now, and let's see
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  Speaker 1: what happens as we move through the seasonally strong fall
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  Speaker 1: towards the US election. I mean, there's there's lots and
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  Speaker 1: rate cups, there's lots of interesting levers that look like
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  Speaker 1: they're ready to be pulled through the through the fall.
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  Speaker 3: So tell us the PFS is coming, I realized, you
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  Speaker 3: can't tell us too much. Can you tell us something
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  Speaker 3: to wet our appetites?
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  Speaker 1: Here?
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  Speaker 2: For sure?
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  Speaker 1: So I mean the scale of the operation that we
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  Speaker 1: are designing is not dramatically different from the scale of
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  Speaker 1: the operation that our predecessor put in. So you know,
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  Speaker 1: pure gold targeted seventy thousand ounces per ounces of gold annually.
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  Speaker 2: Will probably be a little bit below that. We're taking
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  Speaker 2: a more conservative.
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  Speaker 1: Approach to pulling or out from underground, so that, like
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  Speaker 1: I said, sixty thousand ounces of the ounces of gold
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  Speaker 1: annual production is certainly our goal. And I'm not going
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  Speaker 1: to put numbers on this, but i will say that
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  Speaker 1: we've raised one hundred million dollars in the last year,
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  Speaker 1: and we've spent a lot of that money on the
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  Speaker 1: mind site, doing the projects that were needed to get
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  Speaker 1: this thing ready for restart. So what is it that
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  Speaker 1: people look at in a PFS. They look at a
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  Speaker 1: lot of things, but the big numbers that stand out
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  Speaker 1: are NPV. So what's the net present value of the asset?
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  Speaker 1: And then what's the IRR? What's the internal rate of return?
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  Speaker 1: Well the internal and what's the capex? What's it going
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  Speaker 1: to cost to put this thing into production. Well, our
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  Speaker 1: capex is going to be very modest in the grand
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  Speaker 1: scheme of building a gold mine, our capex is going
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  Speaker 1: to be pretty small because our predecessor company spent three
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  Speaker 1: hundred and fifty million, and we've already spent a big
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  Speaker 1: chunk of money in the last year. There's just not
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  Speaker 1: that much money left to spend. So our capex is
• 11:55
  Speaker 1: going to be very small, which, by the nature of
• 11:57
  Speaker 1: how it's calculated, the capex is in the denominator, should
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  Speaker 1: mean that the rate of return should look very nice
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  Speaker 1: for this operation. So that's another reason why I think
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  Speaker 1: the study could attract some nice market attention, bring some
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  Speaker 1: eyes to this story for the reality of this mind
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  Speaker 1: that we're pushing to restart.
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  Speaker 3: All right, so capex, you raised one hundred million. Any
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  Speaker 3: idea how much more is going to be necessary? Indicate
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  Speaker 3: not much, But I assume there's always there's always things
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  Speaker 3: you didn't count on.
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  Speaker 1: For sure, And I mean it's not so much things
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  Speaker 1: we didn't count on so much as the history of
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  Speaker 1: this asset has been one of under capitalization. And the
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  Speaker 1: last thing that we want to do is repeat is
• 12:41
  Speaker 1: make the same mistake for the third.
• 12:42
  Speaker 2: Time, and so over financing.
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  Speaker 1: Is our goal for accessing when we access the final
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  Speaker 1: piece of capital to get this thing back into production.
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  Speaker 1: We want to make sure that we have enough capital
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  Speaker 1: to carry us through commissioning and into commercial production. And
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  Speaker 1: we're not stressed cash because you know, not being able
• 13:03
  Speaker 1: to do the things that to fix the things that
• 13:05
  Speaker 1: are causing problems is how a mind starts to stumble, right, So,
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  Speaker 1: are we going to access something in the range of
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  Speaker 1: fifty million dollars over the next little while to make
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  Speaker 1: sure that we can we can finish our projects and
• 13:18
  Speaker 1: carry us through to production very comfortably.
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  Speaker 2: Yep, that's the goal.
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  Speaker 1: So where we're working on those, we're doing our best
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  Speaker 1: to do that without further dilution. And when you have
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  Speaker 1: a project that is so close to production, for those
• 13:31
  Speaker 1: who understand what it is that we're doing, other options
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  Speaker 1: all become possible. You know, there's there's other ways of
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  Speaker 1: accessing capital. So we're working on that and we look
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  Speaker 1: forward to, you know, near the time of that prefeasibility
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  Speaker 1: study letting everyone know how we plan on accessing that
• 13:47
  Speaker 1: last piece of capital to get this thing to our
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  Speaker 1: goal of restart in twenty twenty five.
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  Speaker 3: Yeah, in the second half, and hey, if you over perform,
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  Speaker 3: maybe'll maybe we'll have a surprise there. Huh.
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  Speaker 2: I mean the two things I said.
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  Speaker 1: The one constant in the history of this asset has
• 14:06
  Speaker 1: been under capitalization. I would say perhaps over promising or
• 14:10
  Speaker 1: short timelines being in a rush has also been present
• 14:15
  Speaker 1: in the project's history. So we are also very we
• 14:18
  Speaker 1: do not want to repeat that. So we are saying
• 14:20
  Speaker 1: the second half of twenty twenty five, we're doing everything
• 14:23
  Speaker 1: in our power to see if we can make it
• 14:25
  Speaker 1: happen sooner, and if we can over deliver on our promise,
• 14:27
  Speaker 1: then we will happily do so.
• 14:30
  Speaker 2: But let's get all the work done.
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  Speaker 1: The real thing that needs to happen to get a
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  Speaker 1: Mind into production is all the work, all the planning,
• 14:38
  Speaker 1: all the operational readiness, all the drilling, all the engineering.
• 14:41
  Speaker 1: There's all the procurement, the budgeting. There's so much, and
• 14:45
  Speaker 1: we're working through it just as quickly as we can.
• 14:47
  Speaker 3: Yeah, very complex operation. It's one thing you're doing the
• 14:52
  Speaker 3: mind yourself, so you got surprises, but then when you
• 14:55
  Speaker 3: take over somebody else's mess and then you have to
• 14:58
  Speaker 3: make sense of it, there's a lot of challenges there
• 15:01
  Speaker 3: as well, and it sounds like those are in the
• 15:04
  Speaker 3: past and we can look forward to the good times here.
• 15:08
  Speaker 3: So I suggest everybody go to Westredlakegold dot com sign
• 15:12
  Speaker 3: up for notifications, get the latest drill results and all
• 15:16
  Speaker 3: the latest developments, and the ticker symbols. In the US
• 15:21
  Speaker 3: w r LGF and of course in Canada wr lg gwent.
• 15:27
  Speaker 3: Always a pleasure.
• 15:28
  Speaker 2: Thanks so much, Thanks so much for having me, Kerry.
• 15:31
  Speaker 2: I love it. The Financial Survival Network