Mawson Resources (TSX: MAW) CEO Michael Hudson on the Expanding Mineralized Zone at the South Palokas Gold-Cobalt Prospect in Finland

January 18, 2019

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Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the Chairman and CEO of Mawson Resources (TSX: MAW)(OTC: MWSNF), Mr. Michael Hudson. Mike, Happy New Year. How are you?

Michael Hudson: Happy New Year to you too, Gerardo. All is all is great. Thank you.

Gerardo Del Real: I got a Gerardo out of you. Usually you're one of the few that can say Gerardo, you're pivoting on me in 2019, Mike, what's going on? Listen, Mawson had some news that I want to talk about. Just finished up a geophysical survey which doubles the prospective mineralized zone at South Palokas, that's the gold cobalt prospect of course in Finland. This is a story that late last year you put out a maiden resource, which was literally the tip of the spear, right? But did give us an idea of what that looked like grade-wise, and the grades were impressive.

You have a district-scale play that of course aims to duplicate that many times over both on the gold and the cobalt side. I've been reading more and more about how unpredictable the primary sources of cobalt are becoming. And I know that's a big benefit to Mawson. Can we talk about the survey, what it does and let's talk a little bit about what 2019 will look like for Mawson.

Michael Hudson: Well, you've basically covered it in the intro there I think, Gerardo.

Gerardo Del Real: Thanks for coming on, Mike. Have a good one.

Michael Hudson: We were pretty much done, I think.

So what we've done is put out the resource as you stated at the end of last year. A very good start, but only a start. It's something like 420,000 ounces of just over 3 grams gold equivalent in constrained and 480,000 ounces of gold equivalent unconstrained. So a very good start, a top three resource in Finland. But it's all about the expansion. And so that resource really only has a currency of a month, we trust. We're subject to permitting still. We're just going through the final stages of permitting. I hope to have that announced by the end of January and then we can bring four or five rigs to site and start expanding those resources and what this release was so important in that it has defined the extensions to those bodies or continues to define the extensions to those resource bodies.

So we're now drilling along strike and downdip, down plunge immediately from the resource. So it's lower risk drilling and we're very fortunate that the resource lights up like a Christmas tree with these electromagnetic techniques, not very much different to big metal detectors, and they extend those zones. So it gives us targets to hit.

We know the body continues, we don't know the grade of course until we drill it, but it's a lot lower risk than looking for gold in a grassroots exploration property. So that's essentially where the projects come from. We made this discovery from first principles and now we've pivoted into resource expansion.

Gerardo Del Real: Now when I hear that a company is looking to deploy four to five drills, that tells me that one, you likely have a very good understanding of the geologic model. Can you speak to that a bit?

Michael Hudson: Well we've had a long time to think about this project if you like. This permitting was slow as we recall up until a couple of years ago. So we've got a very strong technical team that thought a lot about this. And that's all come together over the last year essentially when we've been able to drill this with a lot more vigor. There's strong controls in a strata-bound sense, so we know the gold-cobalt mineralization is hosted within certain stratigraphic horizons all within a few hundred meters of each other. So we can map that out with various techniques from drilling through to geophysical techniques that help us see under the very thin veneer of glacial till.

But within that strata-bound horizon there's a lot of gold but it's really concentrated by a structural overprint we talk about. That's a little tougher to nail down. But we can start to nail those structures down with, for example, this electromagnetics that shows us some more sulphidic zones that correlate so far with the gold zone. A very typical style of system, an orogenic hydrothermal system that we see in many parts of the world, whether it is Homestake in the US or the Tanami here in Australia. And we're replicating those models and now that we understand the system better and it becomes a lot more predictable as a consequence as well.

Gerardo Del Real: Excellent. Mike, 2018 was a tough resource market for most of us in this space. I'm excited about 2019. We talked about the instability with the cobalt supply. The macro backdrop for gold this year is as good as I've seen it in quite some time and it looks like we're basing it at that $1,290 range in the gold space. So it's a higher base than we've seen in the past. Let's see if we can push through that $1,300 level convincingly. Is there anything else that you'd like to add, Mike?

Michael Hudson: No, I think that's a great summary. This is a gold project driven by the economics of gold, but has about a 20% kicker from cobalt, which makes it a very strategic project as well to Finland and the supply of cobalt in a first world jurisdiction that has the world's largest cobalt refinery only 400 kilometers south of this project. So it's gone a little bit of both there, but the market did suck last year and it's looking much better so far.

Gerardo Del Real: I'm a very big Cubs fan, I’m on the way to the Cubs Convention in Chicago. Our manager, Joe Maddon, had a famous saying a couple of years ago, the year that we won the World Series, and the mantra was, "Try not to suck." So let's hope that in 2019 gold doesn't suck.

Michael Hudson: Okay, there we are. We'll leave it with that, Gerardo. Thank you.

Gerardo Del Real: Thank you very much, Mike.

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