Revival Gold (TSX-V: RVG) CEO Hugh Agro on Latest High-Grade Hits at Beartrack & Plans to Drill the Recently Expanded Arnett Creek Land Position
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is President and CEO of Revival Gold (TSX-V: RVG)(OTC: RVLGF), Mr. Hugh Agro. Hugh, how are you this morning?
Hugh Agro: Thanks for having me, Gerardo. Happy to be back.
Gerardo Del Real: It's a great time to catch up. The summer doldrums are behind us. It's still a tough market in the junior resource space. You and I had talked privately off the air. And I'll say it on the air, I think Revival Gold is a model of how companies in the business, in the junior space right now, should be acting.
You had some excellent news this morning and you've been very busy, despite the tough market. So I wanted to get into all of that. Let me start by congratulating you on this morning's news. You intersected 105 meters of 1.38 grams per tonne gold. You also intersected 70 meters of 1.89 grams per tonne gold at the Beartrack Project.
Now it's really important for people to understand, because I can tell you when the news first hit, I had an email saying, "Yeah, well, this happened down at 380 meters and 500 meters." And I had to point out to a couple of people that that was intentional. The area that you drilled is actually right below the conceptual pit shell, which of course is going to add, hypothetically in a perfect world, to the existing resource.
Let's talk about the news today, Hugh. Give me the details.
Hugh Agro: Well, you're absolutely right. We were targeting extensions to the known resource. So working from the known resource out. And of course the deposit at Beartrack is open along strike for about 5km and to the southwest. And it's open at depth. So these first three holes out of a program – it'll probably be about 15 to 17 holes – were targeted to extend the resource and check the depth potential of the deposit.
Sure enough, we hit very impressive widths of mineralization, importantly true widths of mineralization here that are well, well, well above mining widths. And super grades here. Two to three times the cutoff grade, all within 50 to 130 meters of the current resource conceptual pit. These are a big plus.
Gerardo Del Real: Now you have two rigs turning. Is that correct, Hugh?
Hugh Agro: Correct. We've got two turning. We've got one right now in the Joss area, and the second in between Joss and the South Pit area. We've completed now a total of nine holes. This release is on three of those holes. The others are in for assay and/or QAQC, and we'll have those results coming out in the coming weeks. Then the rest of the program, of course, over the coming months. I'll probably get the last results out in early next year as we continue to the program.
Gerardo Del Real: Excellent. Now, I mentioned early on that you've been very busy behind the scenes, especially over the summertime. Another piece of news that I want to talk about from back in July, you actually expanded the land position at Beartrack and Arnett Creek. That's important because you're already working with an asset that has approximately 2 million ounces across all categories. The expansion of the land position of course is going to add to the blue sky exploration potential, obviously. Can you talk about the thinking there?
Hugh Agro: Yeah, I can now. It's been tough talking about it over the last year or so, as we worked to bring that land position together. And, Gerardo, you know because you've been out to site a couple times now that we have a fabulous position there. But there were a couple claims that we wanted to pick up. We wanted to be a little bit quiet about what we have at Arnett, not make too much noise about that, and get those claim positions in.
We've now done that. One of them dates back to the first governor of the state of Idaho, a gentleman by the name of Shoup. A very nice group of family members, but located all over the country in the U.S. and we had to track them all down and organize the deal with them. As well as for a neighboring plot of land, and then we did some additional staking. We got all that done and announced over the summer in the quiet times, all for a relatively good value.
I think we've done a super job here. The team has done a super job here in consolidating this land position. We now have what works out to almost 12,000 acres across this belt of geology that produced and/or resulted in the discovery of greater than 3.5 million ounces to date.
Gerardo Del Real: Now I mentioned the anchor, the resource base that you've already established at Beartrack. I've said that Arnett Creek provides the opportunity for possibly a game-changing scenario if you can make a significant discovery there. How much drilling will Arnett Creek see here in the coming months?
Hugh Agro: We're planning to get in there, targeting to get in there for about 2,000 meters, or up to 2,000 meters. It will be dependent on permitting. We've submitted permit applications in October last year, went through public review in February. We're just kind of winding through the process to permit 52 drill pad locations across the branch of property at Arnett.
As you may recall, we took about 100 rock samples on surface on the Arnett property last summer. And over a third of them are over a gram a tonne on surface. So we're really excited to be getting in there, and there are lots of targets. Meanwhile, with these claims that we've picked up over the summer, we're pursuing a parallel permitting track on the patented ground. And one way or another, Gerardo, we'll get in there and we'll get some drilling into the Arnett project this year. I can't say exactly whether we'll hit the target of 2,000 meters, but that's what we're aiming to do.
Gerardo Del Real: Fantastic. Now I mentioned early on that Revival Gold should be a model for how junior companies should operate in the space. A large part of that is: one, share structure; two, the treasury. You've managed to be very responsible with shareholder money. What does your G&A budget look like at Revival? Can we talk about that a bit, Hugh?
Hugh Agro: You bet. This is a team that's been through a few cycles. We manage the company and the treasury prudently. We're all shareholders. Our interests are entirely aligned with our fellow shareholders. I myself have almost $2 million into the company, so I want to make sure that we spend the money that we have in this business well.
The current burn is running at about just over $100,000 a month. Beyond that, we've got our exploration and development budgets. Those are the kinds of things that we can tweak, depending on how market conditions run. We don't have any long-term commitments that are onerous. We have a lot of flexibility around our deal with Yamana, which brought in the Beartrack property.
In fact, all of our dollars are going into the ground. We don't have to pay any substantial sums to Yamana until year seven of our earn-in agreement on Beartrack. So that gives us a lot of flexibility with respect to our spend. And our G&A at the modest rate of about $100,000 a month, I think stands well relative to our peers.
Gerardo Del Real: Well, the other thing that I think you and the company should be commended on is you continue to tell your story, Hugh. I know you'll be at the Precious Metal Summit in Beaver Creek, which I believe runs from September the 20th through the 22nd. Then I believe you're also at the Denver Gold Forum, which runs from the 23rd through the 26th in Colorado Springs. Am I right on both points there?
Hugh Agro: Yeah, thanks for reminding your listeners of that. We are certainly not crimping or skimping on our marketing spend. We've got a great story to tell. So we are attending the conferences and I love chatting with folks. So if you're in New Orleans later this year or attending the Beaver Creek conference or the Denver Gold conference, I'd love to hear from you. I'd love to meet up and meet in person with folks who are interested in our story.
We've got a great story to tell. It's one of those kind of stories that almost tells itself. But we've got to get up there and be on the road, beating the pavement to make sure people learn about Revival Gold and the Beartrack Arnett project.
Gerardo Del Real: Lastly, Hugh, share structure and cash position. What did they look like here at the end of the last reporting period?
Hugh Agro: 42 million shares outstanding currently and cash at the end of last reporting period, end of June, was $4.7 million. So we're in pretty good shape here. We've got a number of warrants and options out there that would take us up to, at most, 55 million shares on a fully diluted basis. But a lot of those would of course generate cash proceeds to the company if exercised.
So I think we're in pretty good shape here with our capital structure. We'll aim to manage that. As you point out, it's a key differentiating feature. A company like Revival Gold with 2 million ounces in the ground and the team we've got, trading for the market cap we have, it doesn't take much for us to take off, given the tight capital structure.
Gerardo Del Real: You also have some very strong, long-term supportive shareholders, including Orion. Can you talk a bit about the relationship there because I know they've been active, of course knowing the cyclicality of the resource space. And they're some of the smartest money in the business, can you talk about that relationship?
Hugh Agro: Sure. They bought 10% of our business for about $0.60 a share about a year ago, just under a year ago. We've had a great relationship with Orion. There are no bells and whistles on that financing that they did with us. In fact, it's a partnership with an arrangement whereby we work with them on opportunities to continue to grow the business.
And they are extremely smart. They've been very active in the market. They are selective in who they deal with. We've got their full confidence. I think for the retail shareholder who doesn't have the time and ability to do the kind of due diligence that the likes of Orion does or yourself, Gerardo, I think it's a huge stamp of approval on our team and on our project and what we're doing.
Our other shareholders consist of some pretty quality institutions and high-net-worth individuals. There really only is about 20% of the shares left in retail hands. We'd welcome having more folks of that nature involved in the company and riding along the good work and the good due diligence that the more sophisticated players in our space have done.
Gerardo Del Real: It's a tough market. We've said that three or four times during this interview, Hugh. But you've always been very, very good about using tough markets to buy right. I have to believe with those supportive shareholders that you're looking at projects and possibly looking at accretive opportunities. Would I be incorrect in saying that?
Hugh Agro: We are. It's definitely “game on” time for Revival Gold. We're a growth-focused company. There's some great opportunities out there, as you've said. We're doing our homework. We'll act when we see something that makes sense for us and for our shareholders. And in the meantime, we're continuing to deliver value out of Beartrack and Arnett. And we have quite an exciting fall season coming up here with the results from the drill program, with our met testing underway and with the other actions in respect of Arnett that we've already discussed.
Gerardo Del Real: Fantastic. Hugh, thank you so much for the very thorough update. We will catch up in Beaver Creek.
Hugh Agro: Okay. I will look forward to that, Gerardo.
Gerardo Del Real: Thanks again, Hugh.