Midas Gold (TSX: MAX) CEO Stephen Quin on Updated Draft EIS Schedule & Earning a Social License at the Stibnite Gold Project in Idaho
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president and CEO of one of the best undeveloped projects in the entire country, Mr. Stephen Quin of Midas Gold (TSX: MAX)(OTC: MDRPF). How are you sir?
Stephen Quin: Doing good. Thanks very much, Gerardo. Staying safe at home.
Gerardo Del Real: Well you answered my next question. I'm glad to hear that one, you're staying home and two, more importantly that you're being safe. You and your family are all well?
Stephen Quin: Yes, everybody's doing well. Just generally trying to follow those guidelines out there on social distancing. We're in British Columbia and we're seeing the benefits of that. It's working, we're seeing the curve flatten and that's what we've all got to do our best to make sure that happens.
Gerardo Del Real: Absolutely, absolutely. You announced an updated schedule for the Stibnite Gold Project's draft environmental impact statement, and I wanted to get your take. There was some very supportive language in the announcement.
Can you provide a brief overview and what it means in regards to the timeline that we all have in mind for what we all believe is going to be a favorable permitting decision on Stibnite?
Stephen Quin: Sure. So we put out the press release yesterday and essentially the next big milestone is the draft environmental impact statement, or Draft EIS, which was scheduled to come out early this year. The new schedule is to come out in August of this year.
Essentially the challenge has been – and it's a challenge that is right across the US permitting system – you have multiple federal, state, local agencies putting together a single document on a large, complicated project. When you take ours in particular, because it's a brownfield site with all the cleanup components, adds additional complexity. Essentially the experience we've had is the Forest Service, who is the lead agency, has been under capacity, didn't have the experience with a project in this area, the forest that we're dealing with, a project of this scale and complexity to create a document that meets the requirements of a Draft EIS, which allows external parties, whether it's the public or NGOs or other parties that are interested and want to comment on the project, something that is useful to move forward.
We worked extensively. When we got the Draft EIS in January, the preliminary of that draft we saw lots of issues with it but so did other agencies. The Forest Service recognized that. And they have, over the last few months, brought to the table some very experienced people with a lot of knowledge, a lot of experiencing managing projects of this scale and complexity. Really trying to refocus the drafting of the EIS onto a document that meets the need of the permitting process, and is much more focused, tighter, much clearer and will provide the ability for those external parties and the public to comment appropriately on a project that they now understand from documentation.
Gerardo Del Real: You mentioned the Forest Service. We have $1,600 gold now. It appears to be a pretty good base that it's building at these levels, which leads me to believe that we're going to see higher prices, which also leads me to believe that we're going to see a lot of new companies come out with recycled projects and projects that maybe have seen other cycles. But that'll be new to the newer speculators in the space.
For those companies that are looking to really develop a project into a mine, what advice would you give companies and CEOs as it relates to working with a group like the Forest Service from the early, early stage of each individual project? Because I've seen firsthand Midas Gold doing everything from mitigating fire hazard areas, to helping build roads, to you working hand in hand with the Forest Service. This was years and years ago. This isn't now that we're up for permitting, this is work that you've done for many, many years.
Can you speak to that approach when you get to a community and you have a project you believe in and you want to engage members of that community in a respectful and transparent way?
Stephen Quin: Yeah. I would characterize it in perhaps an overused statement, but there's this social license to operate. Essentially yes, you have a license which you're granted by an agency to go do something, but there's so much more to it then that piece of paper that a government agency might give you. We've been focused since we got to site back in 2011 on building relationships with different agencies, with communities, with tribal government, with NGOs, a whole variety of different groups and people. It doesn't mean that everybody ends up liking us or liking the project. Some people have very definitive focus on not supporting mining period or whatever, but the point is to get factual information out there, get it there early, and have people understand.
They may have their principle position that they don't support mining generally or your mining project, but at least they understand the project and what you're planning to do. I think with our project we've been very, very focused on that. We've been in the community for an extended period of time and we've had dozens and dozens of meetings in the public forum, different settings. We take typically 450 to 500 people from the local communities up to site on an annual basis and have been very focused on that communication information part first.
Then the second component or what I would characterize is you got to walk the talk. You can go in there and promise oh we're great, we're going to do everything right, and we're really good people, trust us. I would characterize trust as earned not given. So again, back since 2011 we've been very focused on doing things the right way, whether that's environmentally, community, social, safety, all of those things. We put a lot of time and effort into those things because people look at it and they see you're doing the right thing now, you earn their trust over a period of time. They say, "They've been doing the right thing for the last 8, 9 years. We have confidence they're going to keep doing the right thing going forward."
On top of that you then build a framework around that trust. So we have agreements with 8 different communities in the area which says, "Yeah we've earned your trust so far, but here's a mechanism that essentially makes sure that we continue to do what we've said we would do." You build that framework around it. It's definitely a very broad, comprehensive approach to earn that social license, with respect to regulators in particular.
The challenge in the US system, I would say more than anywhere else, is it's a very, very fragmented permitting process. There are multiple agencies each with their own regulations. It needs improvements and better coordination to make it more efficient. Canada or Australia have equally tough environmental standards, but they can permit a mine or get a mine through the permitting process in two or three years, whereas it can take 5, 10 years in the United States for exactly the same type of project. There's no environmental benefit to any of that. It's time and bureaucracy and money that costs shareholders of a portion of their value because it's being spent on permitting and it causes dilution.
Gerardo Del Real: Well, you've done it the right way, Stephen. You've absolutely earned I know my trust and shareholders that I speak with. So congrats on that front. I am looking forward to a 2021 that celebrates a permit and hopefully much higher gold prices. Anything you'd like to add to that?
Stephen Quin: Well, I think in some ways you may be exactly right on is the timing may work out well, as opposed to getting a permit when gold's $1,000 an ounce and then wondering how do you move it forward in that kind of environment. To be advancing to a production decision with gold at $1,600 or potentially higher makes that move forward into being a producer much more achievable and much more realistic. Timing could be perfect.
Gerardo Del Real: Agreed, you have an excellent, world-class deposit. It's got scale, it's got world-class exploration upside, lower quartile cost, great margins, and a lot of runway between the current market cap, even on a fully diluted basis, and the NPV in US dollars.
I encourage everybody to go to Midas Gold's website, the numbers are there. Stephen, thank you for the update and look forward to having you back on here soon. Keep safe out there.
Stephen Quin: And you too, Gerardo. Thank you for talking to me.
Gerardo Del Real: Thanks again.