Latest / Financial Survival Network / West Red Lake Gold: Primed for Near-Term Production with Top-Tier Team & Infrastructure

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West Red Lake Gold: Primed for Near-Term Production with Top-Tier Team & Infrastructure · Financial Survival Network

• 0:00
  Remember Pure Gold was at a billion dollar market cap when they were up and
• 0:03
  the running, so that's where today at two hundred million dollars. So that's
• 0:07
  you know, that's a lot of upside as we move very close to production.
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  And that was in a lot of different goal prices at that time as
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  well, at carry that was at a much lower that was at a fifteen
• 0:17
  hundred dollar gold price. So you that upside in value as we move forward
• 0:22
  to production with a higher gold price gives a lot of leverage going forward to
• 0:26
  the company. The Financial Survival Network now more than ever, the Financial Survival
• 0:36
  Network And welcome. This is Financial Survival Network. I'm your host, Carrie
• 0:42
  Lutz, really really excited to do this new sponsor interview with Shane Williams.
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  Shane, you are CEO of west red Lake Gold and you've been in the
• 0:54
  news lately. You've got the Madison Project. In fact, as we speak,
• 0:58
  just today you released some really really stellar drilling results. So I wasn't
• 1:04
  going to start with them, but when I saw the release today, I
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  figured, let's talk about it. It's in the meds and mines South Austin
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  zone and you really hit some high grade gold there. Yeah, great to
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  be on Carrie. And I think key key for us is that really this
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  is previous operator, which some of our listeners will know is pure gold.
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  And you know, they got into a lot of challenges on this mine,
• 1:30
  but they never really got into the heart of the orebody and they never really
• 1:36
  uncovered the true value that underneath the covers effectively. And we're beginning now with
• 1:42
  new approach to get in underground and drill and we're getting some spectacular findings and
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  I think the market will slowly wake up to this orbody and go, wow,
• 1:49
  this is really something special. Today. Yes, today was a great
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  press release. We've had over the last four months. People can go on
• 1:57
  to our website. We've we've had some really really spectacular results and they will
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  continue and so that's a good story coming out of this. The people will
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  really see the potential of this money as we go forward. Yeah, And
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  I think it's important that we kind of go over the history of the mind
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  your involvement because the project has gotten a bad rap over the years under the
• 2:19
  prior management, and we don't need to slam them. Things happen. We
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  had COVID, you had a lot of external factors, but in the end,
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  the buck stops with management. So basically this all came together. How
• 2:35
  did you get involved with the project? Yeah? So really people were well
• 2:43
  recognized Frank Guster. Obviously, Frank has a long history in building successful gold
• 2:50
  companies over the last thirty years. And to go back a little bit,
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  some of your listeners will will recognize this. Frank saw the setup for goal
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  to years ago potentially with all the spending, the you know, the inflation,
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  the amount of money that's been spent, and that normally sentences have a
• 3:08
  good, strong gold market for gold. However, you know, you got
• 3:13
  to be at the right time, and you got to get timing right,
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  and you gotta it takes a lot of you know, forward looking and a
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  lot of ideas to go and make that decision. But he saw the setup
• 3:23
  for that goal and saw the potential to build a gold money company in a
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  rising gold price. And that's where you get real leveraged this. You know,
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  you could get a project the expiration project in gold, but it'll never
• 3:35
  be in production. But we saw this opportunity as a way to get from
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  a into production in the rising goal market. So we went down and I
• 3:43
  went down and had a look at this project. We did an extensive diligence
• 3:46
  on the project really to understand what went wrong, what were the challenges.
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  And again again I'm not going to get into all that, but but COVID
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  was a big factor. You know, in the every mind in the world
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  was affected by COVID. They had just been got what I saw very clear
• 4:01
  to is they just begun to get it right. They were just getting into
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  the right or they were getting an understanding of your body. I would say
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  with another six months and another twenty million dollars, they would have cracked it.
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  They brought in some very good people, they had done it really well,
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  and then COVID hit them and that kind of killed them, the final
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  straw that broke the camel's back. And so when I saw that, I
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  saw, Wow, these guys were ready to go. And I came back
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  and I said to Frank, let's buy this. Let's go in and let's
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  get this project. It's a great starter for building a company. And we
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  negotiated, I mean really, with Frank's background, we negotiated a phenomenal deal
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  basically, and it was really I mean, go back to the time,
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  go back a year, a year ago, year and a half ago.
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  You know, gold was unheard of. Nobody cared about gold. It was
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  dead, you know, investors, junior miners who couldn't get money. So
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  to make that decision and make that thing now it's we look like geniuses,
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  but it was just frank and timing. You know, timing is very important
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  in this goal game. As your listeners will know, diving is everything in
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  life. And you know the as the cliche, the Chinese character for crisis
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  is composed of two characters, danger and opportunity. So where the danger lurks,
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  the opportunity is present as well, and so it's permitted. You've got
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  a pristine mill that I think that you mentioned they put three hundred and fifty
• 5:25
  million into that would probably cost you well over double to reconstruct that. Yeah.
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  Yeah, there was a lot of infrastructure put in place. There was
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  a mill or shit tailings in place, the shaft that's put in place,
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  underground development equipped everything you really need to bell of mine. And look,
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  I've been bell of mines for twenty years, Carrie, successfully, and you
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  know I've been true the process. It probably takes ten years today to put
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  a brand new gold mine into production, and at least as I said,
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  to put that scale in seven hundred million, So you know, if we
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  at the start today with a new deposit, it's probably seven hundred million and
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  another full five years to get a production. So when you see that sort
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  of value of it's really a value play as well. I like that because
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  it's a value playoffs. We got it so cheap. We bought it for
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  like six and a half million dollars in cash, So when you think of
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  that value sort of uncovered, and even another one for your listeners with that
• 6:19
  cam two hundred and fifty seventeen million dollars worth of tax losses. So you
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  have you have the value of the infrastructure that's in place, but you want
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  to have value of tax losses, which are inherently valuable in themselves going forward.
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  So oh yes, yeah. The fact I've been involved in tax loss
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  deals before, and there's a lot of laws and recovering attorney, a lot
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  of laws and regulations governing that for you to actually be able to acquire the
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  loss carry forward. So the fact that you did that right there makes this
• 6:53
  company a vehicle because you're going to be producing, but it could well be
• 6:58
  other opportunities arise from that loss carry forward exactly. That's the opportunity as we
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  look down the potential m and a new opportunities that tax losses inhered me value.
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  But and there was a couple of companies in Canada. We're just bought
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  for the value of their tax losses alone, you know, and that's that's
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  a real value with the infrastructure we have. So look, seven hundred million
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  dollars worth of value bought for about forty million dollars all in, So that
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  shows the value sort of structure, and we're in part. We have a
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  lot of our permits in place. We're ready to go basically right, So
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  a couple of things I heard end of twenty twenty five for production. It
• 7:40
  is realistic, yeah, because we're underground drilling at the moment. We're doing
• 7:43
  that drilling like you said, we talked about earlier that detailed drilling. These
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  underground systems. You need to understand what you're doing, you need to be
• 7:48
  able to do it, you need to characterize them, and you know,
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  it needs very fine drilling. It needs a lot of money. It's drilling
• 7:55
  underground. But what stack's in place, we don't need anything else. So
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  you know, we're ready to go. So that's going to take us twelve
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  months sort of timeline, you know, twelve months to drill on the ground,
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  do that work, and then ramp up started starting in twenty five.
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  So end of twenty five is really a very good target, you know,
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  to get into production. You think of that a production with a rising goal
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  market that you know, we know where it is today, it could be
• 8:22
  a lot higher in the future. And you know in the year and a
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  half time gold is at a much higher rate. That gives you a lot
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  of leverage to the company and the value on the company. We're doing another
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  study the back half of this year, a prefeasibility study, Harry, and
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  you know, just to give people the scale of the operation and get understanding
• 8:39
  from the pure goal time. There were so early studies there was never really
• 8:43
  a detailed study. So on the Western Lake we're going to show and I
• 8:46
  think when we put that together from an MPV characteristic, you really step up
• 8:52
  because remember there's no capital on a go forward basis, So you know,
• 8:56
  you've no capital go forward, you've a much higher goal price. So that
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  really becomes a very attractive sort of project on a go forward basiness. Yeah,
• 9:05
  it's interesting that it becomes a value play and a gold play, so
• 9:09
  you know, optionality wise, really gives you a lot of flexibility here.
• 9:15
  Yeah, some investors love the gold story. Some investors love, Hey,
• 9:20
  you got this for dirt cheap, We're gonna get involved. Because remember Pure
• 9:24
  Gold was at a billion dollar market cap when they were up in and running.
• 9:28
  So that's where today at two hundred million dollars. So that's you know,
• 9:31
  that's a lot of upside as we move very close to production, and
• 9:35
  that was in a lot of different goal prices at that time as well at
• 9:39
  Harry that was at a much lower that was at a fifteen hundred dollar gold
• 9:41
  price. So you that upside in value as we move forward to production with
• 9:46
  a higher goal price gives a lot of leverage going forward to the company for
• 9:50
  sure. Now you mentioned Agie were cleaning out the mill getting it ready to
• 9:56
  restart. You made a pretty interesting discovery. Yeah. One of the previous
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  experience with these malls that in care of maintenance and as you go into them
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  and as people are running them, if they're running efficiently, there's a lot
• 10:11
  of gold tied up in the circuit in care of maintenance, and they never
• 10:15
  clean out these mills, and you know, with the right group and the
• 10:18
  right understanding and the right knowledge, you can go in and clean out these
• 10:22
  mills and understand them and you can actually make a lot of gold. You
• 10:26
  can make gold discoveries that are tied up in the circuits and tied up in
• 10:30
  the system. And we decided to do that and we've been very, very
• 10:33
  surprised on the amount of gold that's tied up in the system, quite substantial.
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  And we're working forward to really understand that. It's an ongoing process,
• 10:41
  but it just shows you when the new approach to our team, unlocking them
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  value wherever we can in the project. And speaking of teams, you've got
• 10:50
  an extraordinary team on a number of levels, don't you. Yeah, I
• 10:54
  think that's another exciting story. You know, we've we wanted to you know,
• 10:58
  in the early years in the last bull as you remembered, there was
• 11:01
  a lot of building of minds, a lot of value created. A lot
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  of those people, unfortunately are at the end of their career. You know
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  that at the end of their careers is a good way of putting it.
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  They're not going to be there to build, you know, building a mind,
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  building the company takes a lot of work and effort over many years,
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  so you know they're not going to be around to build the next company.
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  However, they have a lot of valuable experience and they've been true. So
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  the right blend, I believe is which we created was a very strong board
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  who can guide, who can lead, give their experience, a very strong
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  management team who have all done it before, but are young and hungry and
• 11:39
  ready to build a company. And you have the backing of the likes of
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  Frank Gustra on his network. I think we have a fantastic combination which you
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  know with any acid can be very successful, you know, and also not
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  just Madson to grow a company. The long term value here is to grow
• 11:54
  a mid tier company over the next number of years. That with Mats in
• 11:58
  a stage one of that. I guess if the right opportunity came along and
• 12:01
  somebody wrote an extremely large check, you have to think about that. Huh,
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  Well, that's that's the rule I think. As for our shareholders,
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  if somebody did come along down that road, and you know, we don't
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  know how the market will go. As you know sometimes these markets going markets
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  go a bit crazy. There's a lot of m and a activity and you
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  know, if that opportunity comes along, we would definitely look at it,
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  and yes, we would be very excited about that sort of Shane, what
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  do you think the biggest challenge ahead for you is to restart the mind?
• 12:33
  I think it's getting getting the time and effort to understand that orbody. You
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  know, that's really from a technical perspective where they failed and you know that's
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  you know, this mind could probably be put back into productions straight away.
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  Gerry. They were in production, you know, but we've decided with our
• 12:50
  approach to take a d risking approach. Step back, make sure we understand
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  the rbody a lot better, do the drilling, take the time to understand
• 12:58
  it, and then restart. That's why it's you know, it seems a
• 13:03
  short period of time, but remember they were in production, so you know,
• 13:05
  we have some money to spend, we have some time to take.
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  But I think that that's really for understanding your body and that would allow us
• 13:13
  to move quickly into production. Better to take a more cautious approach. Cautious
• 13:18
  approach, yeah, which will pay off in the long run. So like
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  as far as inflation rising costs, obviously your capital costs are limited here.
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  What are you seeing like the where are costs the most rising or rising fastest?
• 13:35
  Yeah, one, they also the advantages that we picked. We picked
• 13:37
  this mind as in Canada now there's a lot of construction minds ongoing. They're
• 13:43
  seeing huge cost overruns and cost blowouts and you know, take everything's costing more
• 13:48
  and so you know, we don't really have that with the amount of chopex
• 13:52
  has been on, but we ever seen operating costs as we go forward increasing.
• 13:56
  The costs for few chemicals you know, is increasing. So we are
• 14:01
  seeing some of that and we're lucky to be in it. Red Lake in
• 14:05
  Canada, where's a lot of history of mining, a lot of people available,
• 14:09
  so that will mitigate some of that. And in a sense we are
• 14:13
  lucky that we're kind of we have one hundred people on site now working,
• 14:16
  so we actually have actual cost to understand and so you know a lot of
• 14:20
  these studies are done with feasibility numbers and then it takes time to get the
• 14:26
  real costs. We have real costs, we understand them. How we can
• 14:28
  put those into our forecasts to make it much more accurate as we go forward.
• 14:33
  So one of the challenges I see is finding the qualified miners. It's
• 14:39
  an aging profession. Hopefully there's some new blood coming in now that we see
• 14:46
  renewed interest in the sector, but there seems to be like a fixed pool
• 14:50
  of qualified miners, so you kind of get into a bidding war with them.
• 14:54
  Yeah, it's a bit of a challenge in general for the industry,
• 14:58
  you know, not just the miners, but for the engineers and the managers
• 15:01
  and that sort of level the key people. A key advantage of us is
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  the Red Lake region of Canada where we are has been mining goal for hundreds
• 15:11
  and hundreds of years, so there's a lot of experience in the town.
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  There's an evolution have a large mind which are the original gold Cup and there's
• 15:20
  a thousand people working there. There's another mine close by, so there's a
• 15:24
  pool of people who live in the town, where miners who work in the
• 15:26
  town. So that does and that also means there are suppliers in the town
• 15:31
  or service providers, you know, so there's a lot of opportunity around that
• 15:35
  to bring in existing workers around that area. No, there's there's a talent
• 15:41
  pool available. Well, that's that's fortunate. With the infrastructure and the power
• 15:46
  is already there, so you really don't have a lot that you have to
• 15:50
  do to get this thing up and running other than gaining the knowledge base necessary
• 15:54
  to maximize production exactly. Once we do that, we're actually ready to switch
• 15:58
  it back on and interesting for your listeners. And if you can go onto
• 16:03
  our website, which you probably did, there's there's fantastic pictures of the men
• 16:07
  and there's a lot a great video there with Frank and we brought Franken Investors
• 16:11
  up there. It was the video and you really see that the quality of
• 16:15
  the infrastructure that's in place, and you kind of you get blown away by
• 16:19
  the value that's inherent in that development already. Yeah, and you'll see that
• 16:25
  on the on the role on this interview will be covering all that and it
• 16:29
  is quite quite impressive. And one of the other things you have had to
• 16:33
  deal with is raising the capital that was so challenging in the sector over the
• 16:38
  past years, and you know, the past couple of years. Literally there's
• 16:41
  the scores of companies that are just kind of the kind of in the coma
• 16:47
  to state not really doing anything. It's the advantage of all those advantages we
• 16:52
  talked about, and particularly backing like Frank Eustra and his network. We've raised.
• 16:59
  Look, we've raised over seventy million dollars in the last nine months,
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  and you know that's I would say, like you, that's seventy more than
• 17:07
  most of the other companies in the scale. So it shows that people are
• 17:11
  interested, they like the story, they want to be part of it.
• 17:15
  The value they get, the value they get, the upside. They really
• 17:18
  understand that we have a team in place. Now I have done it before,
• 17:21
  I can do it again. So we are attracting good capital. We
• 17:23
  are well capitalized and we never really have an issue on attracting capital, which
• 17:27
  is very important for people when they're going into the space they want. And
• 17:32
  we have huge liquidity stock prices. We have lots of liquidity every day we
• 17:37
  have We're a very well known name and where we've moved and you know,
• 17:41
  for some of our listeners, we were the top for second top or form.
• 17:45
  We stock on the TSXV last year we got an award on the TSX
• 17:49
  fifty ESXV fifty, so you know we're getting that traction. We have the
• 17:53
  liquidity, we have a board. There's a lot to be very hopeful as
• 17:56
  we go forward, very exciting times and we're looking forward to touching base with
• 18:02
  you in the months ahead and monitoring with you know, monitoring West red Lake's
• 18:07
  progress towards the eventual restarting of the mind. They suggest everybody go over to
• 18:15
  Westredlakegold dot com sign up for notifications. Ticker symbols US w l r G
• 18:21
  F in Canada w r l G Shane. Thanks so much for taking time
• 18:26
  out to speak with us, and we'll talk to you again soon. Excellent,
• 18:30
  Thank you very much. The Financial Survival Network