Equinox Gold (TSX: EQX) - Gotta Do It, Gotta Do It Big, by @CruxInvestor

Interview with Christian Milau, CEO of Equinox Gold (TSX: EQX).

Equinox Gold, listed around 2 years ago with Ross Beaty as the main shareholder, with goals to become a multi-jurisdiction, large-cap gold mining company.

Equinox has a promising portfolio of assets: Mequite Gold Mine, a Californian project producing 125,000-145,000oz gold per annum with an AISC of US$930-$980/oz and a grade of 0.46g/t gold (exclusive of reserves), Aurizona Gold Mine, a Brazilian gold mine producing 75,000-90,000oz per annum with inferred resources of 1.1Moz @ 1.98g/t gold (with an exploration upside) and an AISC of US$950-1025, Castle Mountain Gold Mine, an under-construction gold mine with a PFS and production potential of 200,000oz per annum and a 16-year life-of-mine, and a copper-focussed spin-out operation in the form of Solaris Copper Inc.

Equinox has had a quite remarkable rise over the last few years, with its share price hovering around CA$5 at the start of 2019, now standing at CA$10.95 today. The market cap is an impressive CA$1.24B.

We spoke with Milau about a variety of topics. Targets that were set have been well and truly delivered. Mesquite and Aurizona are up and running, producing at a reasonable scale with a good AISC. Castle Mountain should be ready to rock by Q3/20. Equinox has kept things simple and it is reaping the rewards. The portfolio is focussed; thus, projects aren't lying around waiting to be put into production like they are for so many mining companies. Equinox's message is simple: make good acquisitions, and get that gold out of the ground! 11% insider ownership is another reassuring fact for investors, alongside a more diversified shareholder base than when we last spoke with Milau.

We then move into Equinox's spending strategy, in addition to the gold macro story. What does the outlook for the gold market look like for 2020? Milau states that his thesis denotes this is only the beginning of this new gold cycle. Milau is conscious it won't all be plain sailing, but this is an early stage of the turn (US$17T of negative-yielding debt, solid stock markets and slowing global growth). The best is yet to come? Equinox has no intention of being taken out. It plans to become a long-term investment opportunity that can last through several cycles. Equinox appears to have the leverage to make use of a rising gold price. We appreciate Milau's pragmatic take on gold margins: Equinox is not rushing to produce; there is no spike in production. Equinox is managing a steady, structured increase.

To continue to grow, Equinox will proceed with developing its current assets and look at new acquisitions when the time is right. It recently announced a (28th Jan) merger with Leagold Mining Corporation that will combine the companies, 'creating one of the world’s top gold producing companies operating entirely in the Americas.' This should position Equinox even more strongly. Equinox has recently had debt repaid to it by Serabi Gold, so it is in an even stronger position as it looks to become more than just a 1Moz per annum producer. Equinox is proceeding cautiously and isn't getting ahead of itself.

As far as remuneration, one of our favourite elements of the story, Equinox continues with its remuneration policy of mainly shares as opposed to a conventional cash salary. Milau claims he hasn't cashed any in yet.

Interview highlights: