Ethos Gold (TSX-V: ECC) CEO Craig Roberts on the Ethos Team & Drilling Plans at the Pine Pass Vanadium Project in British Columbia and La Purisma Gold Project in Mexico

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the President and CEO of Ethos Gold (TSX-V: ECC)(OTC: ETHOF), Mr. Craig Roberts. Craig, how are you this morning?

Craig Roberts: I'm good. Thanks, Gerardo. How are you?

Gerardo Del Real: I'm excellent. Happy New Year.

Craig Roberts: Happy New Year to you as well. Thank you.

Gerardo Del Real: Listen, I'm expecting big things out of Ethos. And I know the company is called Ethos Gold. It could appropriately be called Ethos Gold and Vanadium. And I want to talk about that in just a bit, Craig. But if you could give us a bit of background on your past successes, what you've done, and then let's talk about the company and what 2019 holds in store for us.

Craig Roberts: Sure. Sounds good, Gerardo. Depends how far you want to go back.

Gerardo Del Real: All 30 years, Craig.

Craig Roberts: Well, I can go back even further. I grew up in Australia. Dad was a mining engineer, so I’ve been around mining from when I was quite young. And moved to Canada in the 1970s, did mining engineering at UBC (University of British Columbia). Built a small operating mine with my dad actually right after university, put that into operation for about five years, and then went back and did an MBA. Then I work for Wight Engineers Fluor for about seven years. Worked on a lot of feasibility studies for the precious metal space, small and large underground open pit projects.

So quite a broad set of projects that I worked on there. And then 1996/1997 I went into investment banking with First Marathon Securities, which was then acquired by National Bank Financial. I worked on a lot of institutional equity financing, and also M&A advisory work. In the early 2000s I went to PI Financial with a couple of partners there, and we did a lot of institutional equity financing between about 2003 and 2009 at PI Financial. At least several hundred institutional equity financings. And then we formed our own group, which is called Axemen Resource Capital. We still have that. We were pretty active for a few years. Now each of the partners from that have kind of moved on to running companies and doing other things in the mining industry. So quite a bit of experience over the years in operations, in the market side of things, both in equity financing and also a lot of M&A transactions and advisory work on those.

Gerardo Del Real: Excellent. Now, I mentioned that you have two exciting projects; a potentially large vanadium project and an exciting gold project in Mexico. Now, I want to talk about both. But before that, I think it's important to talk a bit about the team that you've been able to bring together, and maybe a little background into how Ethos was formed. Because the people are really important to testing the potential on both of those projects, which I understand will be tested this year.

Craig Roberts: Sure. Ethos was formed originally by Gary Freeman who founded Pediment Gold. Pediment was sold to Argonaut, I think in 2013 for about $130 million. Gary formed Ethos during that time as kind of a follow-on company. As you may know, unfortunately Gary passed away almost a year ago now. So, this company is a little bit of a legacy to Gary, actually.

Gary's partner in Ethos was Mel Herdrick, who's a very experienced geologist, lived in Hermosillo for many decades, formally of Phelps Dodge. And so, Mel is one of the Ethos directors. And Mel's really the driver behind the La Purisma project in Chihuahua in Mexico, which is one of the two primary projects we currently have. Mel is overseeing the earlier stage exploration, the permitting, and we're moving towards drilling that project in the first quarter of this year. That's something that Mel's brought in. We can discuss in more detail.

In terms of the board, the other people are Michael Murphy, who's joined the board. Michael spent about 15 years in London in institutional sales with Credit Suisse, Merrill Lynch, ran one of the hedge funds there. And came back to Vancouver, formed Torex Gold, which he is still a director of. Torex, they just announced their production for last year, about 350,000 ounces of gold. It's roughly a billion dollar company. And so, Michael's got very strong experience, both on the market institutional side of things, and also through his founding and development of Torex Gold.

The other director we have is Henk Van Alphen, who's a well-known Vancouver mining entrepreneur. Hank's had quite a list of successes and has maintained quite a significant group of companies in Vancouver. Those are the four directors we have.

Jo Price has recently joined us as VP Exploration. Jo oversaw the exploration work we did on the Pine Pass Vanadium project last year. Just did an outstanding job of running that program. She's agreed to come onboard as VP Ex and kind of run a much larger program there this year. Those are the key board and management group that we have.

We've also put together quite a good list of advisors and consultants to help us with various aspects of the projects. Maybe I'd just run through those fairly quickly. The two prospectors that really identified the Pine Pass Vanadium project, Jim Dawson and Murray McClaren. Both extremely seasoned Vancouver-based geologists. We did a deal on the vanadium project from them, and they're staying very actively involved with us in the project. We've brought on Dr. Rod McElroy on metallurgy. Rod's been somebody that I worked with actually years ago at Fluor and Wright Engineers. He's been with Amec and Amec Wood for quite a number of years, and still works for them on a part-time basis. Rod's agreed to come on board to run the metallurgical program. And we're just kicking that off, actually starting this week, in fact.

Then we also are very actively working on community relations and a permitting process for the Pine Pass Project. Michelle Tanguay’s agreed to come on board, as a consultant to the company. She has a lot of experience with First Nations consultation, and works as well with Allison Rippin Armstrong, who is another person who's very experienced in that type of work. Michelle and Allison, again, have worked together to help us with the permitting process through next summer.

Gerardo Del Real: Fantastic. Thank you for the background with Gary there, Craig, because Gary was somebody that earned a lot of goodwill, was friendly to me. So, I really appreciate that. I thought that was important to include.

Let's talk about the projects. You talked about Pine Pass. You have a project that initial trenching indicates has over 100 meters in thickness, significant intervals of high-grade vanadium mineralization, and you have up to 20 kilometers of prospective strike. You just had news actually here recently indicating a 13% increase using a different assay method.

And so, I want to talk about the project and how you plan on delineating the potential because, frankly, the opportunity is huge. You have a tiny market cap of just over $11 million Canadian and a project that looks exciting in a space, the vanadium space, that obviously has been on quite a run. Can you speak to the project a bit and how you plan on testing that?

Craig Roberts: Yeah definitely, Gerardo. The good thing about it in terms of describing it is it’s actually a very simple geologic model and geometry to the deposit. So, the deposit was originally laid down in a very flat kind of tabular body, almost like a coal seam, if you can imagine that. It was subsequently folded into kind of a very large U shape, which is sort of order of magnitude about a kilometer across. The target body that we're going after is, based on the trenching, about order of magnitude, 100 meters thick. I'm sure there'll be variability in that. We've had trenches on surfaces plus-200 meters of economic, what we think will be economic mineralization. So really, and looking at the three dimensions of it in terms of thickness, I mean, you can easily see from the trenching we've done, the potential for 100 meter true thicknesses.

On what we call the east limb it dips about 45 degrees. It looks like, from what we can see and from the macro geology, it looks like it will continue quite consistently, down dip at that 45-degree angle. To be proven by drilling, but based on everything we've seen from the surface geology, that's what we're projecting at this point. Then as you mentioned in terms of strike lengths, this folded body continues from the highway, the John Hart Highway, which the deposit is located on the north of the highway in Northern British Columbia. So, it continues from the highway about 10 kilometers to the northwest. So the two limbs of this, what we call the syncline, the dipping body, have strike expressions of up to 10 kilometers on our property. So, if you look at those three dimensions, the thickness, the down dip potential on each limb, and the strike lengths, I won't throw numbers out there, but you can get to very large tonnage numbers very quickly.

It's very straightforward to explore, because it's pretty simple in terms of its geometry. We're actually planning quite a large drill program for this year. I think we have some quite good potential to develop a significant resource by the end of the summer.

Gerardo Del Real: Well, I'll tell you why I get excited, Craig. You won't put the number out there, but I've done a little bit of the math myself. And let me be completely transparent. I'm biased. I participated in the recent financing. I like to eat my own cooking. But there is a potential here for greater than 25 million tonnes, assuming of course, that strike length and the thickness holds up.

But you mentioned the simplicity of the project. With the kind of grades that we've seen, if that bears out, that's exciting. Again, relative to the $11, $12 million Canadian market cap that you have right now. When can we expect to see testing of that target with the drill?

Craig Roberts: Well, our current schedule is to mobilize in May and to initiate drilling in June. So that's how I'm scheduling. We're working pretty aggressively towards making sure that happens.

Gerardo Del Real: Perfect. Now, the neat part to this story is you also have an oxide gold target in Chihuahua, Mexico that you're actually testing, I understand, before the vanadium project. Can we talk about that La Purisma project in Mexico?

Craig Roberts: Sure. As mentioned, that was one that Mel Herdrick brought in, who was Gary's partner in Ethos – in Pediment actually originally, and now who's joined Ethos. La Purisma, it's an epithermal gold project. It's located in an area in Chihuahua that's fairly flat and road accessible. So it's not up in sort of remote mountains in the Sierra Madre, that kind of thing. It's actually pretty much ideal from an access point of view. The land is privately owned and we have a deal with the landowners for long-term access to the project. So if we're successful in making a discovery, we've got a deal in place to give us through the development of a project. Essentially the project, there's at least five identified northwest striking, sub-parallel epithermal veins. Pretty close to vertical. There's some historic underground and open pit mining on them.

What really attracted Mel to the project is that there's quite a bit of evidence that there's gold mineralization between the veins, not just in the veins. So, if the mineralization was just in the veins, we might be looking at it as sort of a plus-5 gram underground type target. But with this potential dissemination of gold between the veins, and much more broad halo of mineralization, we're actually targeting it as a potential surface mineable type target. Now, we haven't drilled yet, so we'll have to wait and see what the drilling results are. But that's our conceptual target here is to identify economic grades of this disseminated mineralization outside of the veins, which in combination with the vein material would give us a tonnage and grade for sort of an open pit heap leach type target. So that's what we're going after there. Mel's been around a long time, seen a lot of projects, and he's very excited by this project. So, that says a lot to me in terms of its potential.

Gerardo Del Real: Well, he knows the area well. And I understand that project will be tested in Q1 of this year. Is that accurate? Within the next couple of months?

Craig Roberts: That's correct. We've got our permit applications in. There's been a little bit of a delay due to the change in the Mexican government and the people that stamp the permit approvals. But we believe we're on the agenda for somewhere around mid to late January. So actually very shortly here. And once we have the permit, we're going to initially do a few weeks of trenching, because there is a thin cover on the surface there, and we want to make sure that we fully identify the higher grade areas to drill. But that'll be a fairly short program. We should get results back from that very quickly. If we get the permit in late January, our schedule is to be drilling by late February, early March, somewhere in that range.

Gerardo Del Real: Excellent, excellent. Well, I'm looking forward to results from each of those projects. Again, I just want to provide a little context. Not only do you have two big shots on goal with the vanadium project and the gold project, not only do you have a tiny market cap of approximately $11 to $12 million Canadian, but that's backed up by approximately $7 million in cash. Is that correct, Craig?

Craig Roberts: Yeah. In fact, it's probably $7.3 at this point.

Gerardo Del Real: There you go. It's a heck of an opportunity. I want to thank you for your time. Is there anything else that you'd like to add? And I'll add one last thing. I hope you come back on once we start getting trenching results and permits received for each of those projects.

Craig Roberts: Yeah, I'd be happy to, anytime. It's pretty straightforward story. We're excited about the gold project, the drilling on that is pretty imminent. We’re ramping up on the vanadium project and very excited by that as well. So yeah, the next few months are going to be interesting.

Gerardo Del Real: Fingers crossed, Craig. And if we get a raging gold bull market the way I think we're on the cusp, I think it's going to be a fun year.

Craig Roberts: Yeah. Me as well.

Gerardo Del Real: Fantastic. Thank you, Craig. Appreciate it.

Craig Roberts: Thank you. Thanks, Gerardo. Appreciate it.