Millrock Resources (TSX-V: MRO) CEO Greg Beischer on Executing the Project Generator Model & Drilling Multiple Projects in 2021
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the President and CEO of Millrock Resources, Mr. Greg Beischer. Greg, how are you today?
Greg Beischer: Well, I'm doing good, Gerardo. I'm in Fairbanks at our northern-most office now and you’ve been around here before. It's a pretty typical January day. Not too warm out there, but bright blue sunny sky.
Gerardo Del Real: As cold as Anchorage is right now, a blue sunny sky in Fairbanks means it must be freezing. What's the weather like right now?
Greg Beischer: It's just one of those bluebird days, but it's around -20 Fahrenheit at the moment, so...
Gerardo Del Real: I won't tell you what the weather is like down here in Austin. Listen, you had some news today, and I know that 2020 was a disappointment to all of us, frankly, because we always want to make a discovery. The first go round, we gave it a good go at 64North. It hasn't happened yet. It's obviously early exploration, takes time.
You had some news today that's really encouraging, and I thought it did a really good job of highlighting the project generator model, right? And the news is that Millrock has received cash and share payments from Resolution. Resolution has earned a 30% interest in Millrock's 64North Gold Project.
A lot to dig into. I'll let you provide a bit of context, but this is, I think, a classic example of why the project generator model has had the longevity it has, right?
Greg Beischer: Right, I guess I'll go back to the beginning when we started developing the 64North Project about five years ago, picking up little claim blocks. But then about two years ago, staked a huge track. We staked the whole district. It was wide open, unbelievably, and that whole effort cost us probably on the order of $600,000 US.
We've turned around then just over a year ago and made an agreement with ASX listed Resolution Minerals. And it's a very full credit. They raised a lot of money in Australia, drilled nine holes, worked up other prospects to drill readiness, but they expended in excess of $5 million US over this effort.
The results of the drilling were very disappointing, honestly. We were drilling within sight of a mine, and we thought, for sure, we were going to hit with those holes, at least one or two of them, but it's exploration. It didn't happen. I certainly don't write that prospect off, but more drilling is definitely warranted in the area. We had some very good looking things, just didn't have the gold.
But, at this point, Millrock's recovered all of its initial cash investment, we’re quite large shareholders of Resolution Minerals now with 14 million shares issued, and Resolution indicates they're fully on board to continue the exploration, drilling some of the other prospects that were developed. And so they'll be drilling. They're going to take over operatorship, and they're going to do more drilling on the project this year.
So lots of potential for the value of Millrock's Resolution shares to go up. And at this point, we're still a 30% owner of the project. So I just think it just goes to show that the generator model is a good one, that it's a longer term approach to exploration. It's a way to reduce the inherent high level of risk that exists naturally in early stage exploration, but still exposes our shareholders to great potential share price increase in the event that a gold or a copper discovery is made.
Gerardo Del Real: You spent, I believe, in the order of $600,000, you mentioned, generating the 64North Gold Project. Millrock has recovered the entire cash cost, and you now own 14 million Resolution Minerals shares. I have to think that you're happy with how supportive... and when I say supportive, I mean, with the checkbook and the commitment to carry on a new drilling program in the spring time. You have to be happy with how supportive a partner you found for the project.
Greg Beischer: I sure am and the financial backers to Resolution, and they're good to geologists and operators, so I know they're going to do a good job exploring on the project, and we'll be there with them on the technical committee, giving them our input and ideas as well.
Gerardo Del Real: You're in Fairbanks. I have to believe you're meeting with your new partner, Felix Gold?
Greg Beischer: Well, we meet almost every day by Zoom, but unfortunately it's not that easy for them to travel right now. In fact, Australians have difficulty to leave their own country. They have to get permission, and it's not always granted, but we're in good touch anyhow. And Millrock’s opened an office here in Fairbanks, nice exploration set up, nothing too ostentatious, but very practical. And, so I guess it was two weeks ago that we announced that we'd made this agreement with a private company now, but will be listed. It's called Felix Gold in honor of the original prospector that discovered gold here in Fairbanks, Felix Pedro in 1902.
And so, Felix is backed by a company called Mine Discovery Fund, a strong group of technical geologists that have had excellent success before and therefore have the ears of financial people in Australia. And so there's great technical and financial horsepower. They're going to bring a lot to bear on the projects we have here, Treasure Creek and Ester Dome and Liberty Bell off to the south a ways.
And we'll operate... so we're bringing our on-ground operational expertise and our knowledge of how to operate in Alaska. They're going to bring some of their highly qualified technical staff and consultants, some of their world renowned geologists and geochemists and seeing Fairbanks-style gold mineralization all over the world and so can bring that global view. So we're building what I feel will be a joint Felix-Millrock team that will really do a great job on the Fairbanks district.
We're compiling all available information. We're going to really tear this district apart from first principles, really understand the metallurgy and what caused the gold to get where it is and proactively go explore. And Felix and its backers are aggressive in how they want to explore. We'll be doing an awful lot of drilling. I suspect Felix will be quite well-funded, and we're going to go to town and hopefully make some big discoveries.
Gerardo Del Real: You have drilling planned with your partners on at least four projects in 2021. Obviously, a lot of shots on goal. It's been gold, mostly, in the recent past, but I remember once upon a time, over a decade ago, Millrock having some quality copper projects, copper, obviously at $3.60 and with the push towards clean energy, you can't do that. We can't make that transition as a society without large amounts of copper being needed. And so we have supply crunches and by all estimates in a couple of years here, I think, copper trades much higher. Is there a focus to also generate some copper projects and/or partners in the copper space?
Greg Beischer: Absolutely. And in fact, we have two excellent early stage porphyry copper projects in our portfolio right now, both of which are getting strong interest from potential partners. So indeed, we might be drilling even more than just four projects this year, but we are adding more copper projects to the portfolio in the very near future.
Additionally, I really liked nickel. As you know, I came up through the ranks of nickel miner Inco, and nickel's always been something I'm very interested in, and more and more I'm reading how important a metal it will be for the electrification of our vehicles and our cities. And from what I'm reading, there's just going to be huge supply deficits, and early stage exploration for nickel is going to be an absolute necessity. So that's another commodity that we'll be working on.
And additionally, zinc. I think, as you know, one of the best zinc deposits in the world is here in Alaska, the Red Dog Mine, operated by Teck, and there's certainly potential to find more of those spectacularly rich deposits.
Gerardo Del Real: Sounds like a busy 2021, Greg. How is the treasury looking?
Greg Beischer: It's a slam, and especially if we're going to be acquiring lots of new claims and making more deals. So we're going to do a capital raise here in the very near future.
Gerardo Del Real: I think the market senses that. I think the pullback in share price here recently speaks to that. And I also think it's a heck of an opportunity for anyone that wants exposure to a lot of drilling and a lot of shots on goal here in 2021.
Greg, is there anything else that you'd like to add to that?
Greg Beischer: No, we had a little offline discussion just before we started this interview, Gerardo. I would sure like to see the price of gold move significantly higher. That's the lubrication that really fuels and makes our business go. Investors really get most interested when gold prices are moving, and I hope that happens soon.
Gerardo Del Real: I hope so too, Greg. Thank you so much for that thorough update, and we'll be chatting soon.
Greg Beischer: All right. Thank you, Gerardo. Talk to you soon.
Gerardo Del Real: Appreciate it.