There aren’t many living encyclopedias of junior mining sector knowledge walking around out there today. There are maybe a handful of people who have been investing in, and writing about, the junior mining sector for decades and who have literally seen just about everything imaginable that this sector has to offer. Eric Coffin is one of these people, he has a plethora of knowledge and experience and I seem to pick up knowledge and insights from him on a regular basis (either from his HRA Journal, Alert Service, or through sharing his knowledge on CEO.ca).
Eric is also unique in that he's probably the only person that I know who is able to talk about high level geology and mineral exploration concepts, economics, and financial markets while mixing in some "millennial lingo" and a wicked sense of humor. Last week I managed to get him on the phone for an hour and what ensued was a wide ranging and extremely insightful conversation. Without further ado here is my May 2019 conversation with Eric Coffin of HRA Advisory…
Goldfinger: The first question I want to ask is: Why should someone be an investor in the junior mining sector right now? What is the rationale behind buying these stocks right now?
Eric Coffin: Other than masochism, I always view there as being two broad classes when you talk about juniors. One is a discovery story, if you will. I guess “potential to make a discovery” story might be a better way to put it, since most of the discovery stories don't actually become discoveries. That's the reality of the exploration game. Then, you've got developers. I don't generally spend much time on producers, simply because everyone and their dog writes those up. There's no point in me doing it.
With developers, you're betting on metal prices, as much as anything. Some would argue, more than anything. You have to be cognizant of that if you're buying into the whole premise. I mean, obviously, there are developers that will do really well if they enlarge the deposit and then prove the economics along the way. They can get good gains just on that, but you always have to keep in mind that you are betting on metal prices too. Much more than with an exploration story.
But, a good exploration story can basically trade on its own. If somebody makes a great discovery that's a story capable of making gains, large gains in some cases, almost regardless of what the rest of the market does. I mean, obviously, you don't want the market as a whole going down the drain. That doesn't help anybody. But a company will have the ability to withstand larger negative market moves if their discovery's a real one. Plus, I've always had a soft spot for the discovery process with the background and upbringing I've got. I mean, I won't pretend that I'm not a sucker for the romance of an exploration story because it's pretty obvious that I am.
What I don't know yet is how much impact a US-China trade war is going to have on demand for base metals. I mean, obviously, if the whole world goes into a recession, then it's not going to be good for base metals. If the real story and the only story is a trade war. I'm not sure how much it's really going to negatively impact the actual physical demand for say, copper.
Sure, there's some of the stuff China exports to the U.S. [that] has got copper in it. But I think re-export is a pretty minor component of their demand. And I think that goes for most base metals. I mean, the big demand for most base metals is infrastructure, big project builds. Which China is probably still going to keep doing, whether it makes sense for them to keep borrowing to do that or not. There's an argument that can be made that they may actually do more of it, but they're in the middle of this trade war to try to underpin their own economy. I know there's been some trouble, or at least rumors of trouble, when it comes to them raising the kind of money and getting the kind of private partnerships they want for the Road and Belt Initiative, their biggest infrastructure project. That, in and of itself, will be a massive use of metals. I just don't know if it's going to move as fast as they initially planned for it to when they announced it. It sounds like it's going slower than planned. But that's the kind of stuff where you get the real base metal demand. I mean, everybody right now is obsessed about the trade war. But, really, how much metal do even ten million iPhones use? Not that much really, in the scheme of things.
I think there's potential for you to get good base metal developers cheaply on poor sentiment, but I don't think there's a rush to be doing that because we still don't really know how things are going to pan out with this trade war. I don't know how ugly this is going to get.
Goldfinger: You know, that brings me to an interesting question. You said there's an opportunity to get some of these base metals stocks, like maybe a Freeport-McMoRan, or a Hudbay, or something like that, at really attractive valuations. And that's true, we've seen those stocks drop in the last month or so.
Then you say, “well, but we don't know how it's going to pan out,” which is true. But isn't that the way it always is at the bottom? When it gets clear, the stocks have already turned. Right?
Eric Coffin: Yeah.
Goldfinger: Is there a strategy, or is there something that you would do in terms of, maybe, scaling into a base metal stock that you really liked and not buying it all at once?
Eric Coffin: I think that's probably the way to go, and, look for capitulation. Because in the end, you can't ignore what Wall Street is doing. If Wall Street has a big drop, and for me a big drop would be like 15% or 20%, not this 3% or 4% everyone's going crazy about right now. When Wall Street sells, they tend to sell everything, so scaling and looking for capitulation is definitely the way to go here.
My one concern was base metals. And again, I want to emphasize that the U.S. is not the world's most important base metal consumer. Not by a long shot. But, still, sentiment is sentiment, and that's where a lot of traders are.
I'm still not a hundred percent convinced the U.S. won't slip into a mild recession before the year's over. I just see a lot of stuff that looks to me like it's rolling over. It's nothing dramatic. It's not like crash material or anything like that. But I think the economy is actually decelerating in the U.S., I think things could get a little uglier than everybody thinks later this year.
Goldfinger: Yeah. There's a lot of signs out there. There's a lot of anecdotal signs. I just mentioned in the Trading Lab that I was talking to a realtor friend of mine who really has her finger on the pulse here in south Florida. And she said we've seen the market turn down a lot in the first half of 2019. A lot of home prices are down 10% or more, and buyers are increasingly able to basically state the terms that the transaction's going happen at. And sellers don't really have a lot of leverage. Whereas, a year or two ago, sellers put a house on the market or something, and it would be sold at the offered price within a week. And that's just not happening now.
Eric Coffin: I live in the world's most insane real estate market, by far. Vancouver is crazy. There's no other way to describe it. It's insane. It hasn't dropped very much here, but you talk to realtors, if you know one well enough to give you a straight answer, that is. The problem, so far, is that we have sellers willing to move their offers down. I don't see how that doesn't happen. The number of unsold listings in Vancouver is rising month after month, especially at the high end. At some point, I think real estate here sees large and sustained price decreases. Not sure there will be a “crash” like the rapid drops in US real estate markets last decade, but I won’t be surprised if the overall percentage price decrease is as large at the end of the day. And the Canadian economy is not ready for that. I live in a very real estate dependent economy.
And there's actually a weird offshoot to all of this friction between the U.S. and China that Canada's going to drive straight into with Huawei and a few other things where China is really cracking down on, making it a lot more difficult for the rich Chinese to skirt around currency controls. And, of course, that's feeding the real estate market in Vancouver. I've heard a thousand local real estate agents tell me they're a small part of the market, but as I think you probably know, I'm married into a Cantonese family. One of my sisters-in-law is a real estate agent. She just laughs when she hears that. She’s focused on the West Side and Richmond and there, It's almost all Chinese money. Anybody who tells you it's 3% or 5% of the market at the high end is nuts. It's like 80% of the price move because it was the offshore money putting in the high bids and moving the market. There were massive, massive currency flows. You had people who wanted to buy a house, or five or ten houses. They were buying insurance and putting money outside of Beijing’s reach. They just wanted to get it done, so they didn’t screw around and bid high to get the deal closed. Anyone local had to join in or miss out. That’s why the percentage price moves in Vancouver real estate got parabolic.
But you've got to wonder how much these currency flows are going to impact things. I think in the short term, maybe this trade war actually strengthens the U.S. dollar because you've got the sort of insurance buys or safety buying in the USD, which is common if risk aversion rises. And you've got the underlying assumption, which certainly seems to be the underlying assumption most traders in the U.S. that the U.S. is going to quote/unquote win the trade war. Whatever that means.
I'm not entirely sure that's going to be the case. I think it'll be harder on China. But, I'm not convinced that China isn't more willing to withstand the pain, if you will, than U.S. traders are. I'm pretty sure they are more willing to withstand the pain actually. I don't think I'd be betting against China or assuming they will cave quickly, even though I agree it will hurt them more.
I mean, yes, we just saw great US payroll numbers. I recognize all the potential issues with U.S. payroll numbers, but I don't think it's anything like a conspiracy. Just a measure that has great market impact, even though its prone to large errors and revision. Not to mention, it’s a lagging indicator. I think people just aren't looking at some of the things I'm looking at that are showing clear danger signs.
I mentioned in an editorial a couple months ago that I don't like the look of the Fed lending officer surveys where it appears that a lot of them are starting to really tighten things up. They're getting worried. And that's sort of the leading edge. That's the sharp end of the stick. When you see lending standards tighten up, that's generally a pretty big negative. But it's just not something that you see show up in the real economy for three months or six months or more. You don't really notice it in the day-to-day lagging indicators that Wall St obsesses about.
But when you think of how much growth in the U.S. and Europe, or heck, really anywhere, how much growth lately is driven by increasing debt loads. If suddenly, the people that provide that debt are getting skittish, it's a problem. And it just feels to me like that's starting to happen.
Goldfinger: Yeah. I think that's a really good point. I mean, we've seen charge-offs, 90 days plus days late on car loan payments. Both of those metrics have reached basically 10-year highs. They haven't been as high as they are now since the financial crisis, 2009. And that's really interesting that there are literally millions of Americans who aren't able to make car payments on time and are also heavily indebted to credit cards that are charging them interest rates at huge levels that are only going to put them more in debt. So, there's this real dichotomy in the economy. Where there's a segment that has done well, in terms of their stock portfolio and their 401Ks. And there's a segment that literally is living paycheck to paycheck and not even able to make their car payments on time. It's really interesting.
And the fact that you say lending has tightened, that's a really important point because that's a leading indicator. That's showing things are tightening up late in the cycle. Definitely not a good sign.
Eric Coffin: That’s something that I've harped on in the newsletter for probably two years now. And I'm sure there's readers that think I'm starting to sound like some kind of permabear, which I'm definitely not. It's just one thing that's confused me about this expansion, especially the later part of the expansion in the U.S., is if things are so great and the unemployment rate is so low, why isn't anybody giving anybody a fucking raise? What the hell?
I look at the year over year wage increases for non supervisory personnel and you're still sitting at 2.5%, 3%. How do you get 3% or 4% growth in an economy when most of the economy simply isn't getting those raises? It's not that I'm negative about everything, or I'm some kind of a permabear. But, much like you, I'm very suspicious and careful not to just take it as rote when I see stuff coming out of Manhattan, I suppose, just to use a generic term. Where all of the stuff you see that's discussing and pontificating on the economy and how great it is, is all coming from the 1% or the 2% and seem completely oblivious to the fact that the 90% have basically gotten nowhere in the last ten or 15 or 20 years. And I just don't see how that doesn't come home to roost at some point. That's not a good thing.
Goldfinger: That's a really important point. So, turning to the gold sector. We saw the earnings from the major gold miners, the seniors, in the last couple of weeks. We saw Barrick and Newmont, and what really stood out to me from those reports is these companies are stagnant, in terms of their annual gold output. They're actually stagnant at best. I think, in some ways, they're sliding lower. I think Barrick guided to between 5.1 and 5.6 million ounces for the year at an average all in cost of about $900 an ounce, really not terribly impressive in the grand scheme of things.
And the CEO of Barrick basically said we've got the best gold assets in the world, as one would expect him to say. And he also mentioned that there's not much exploration being done across the sector. There's not many newer top tier assets out there to be had. And this is something that people have pointed out for a couple of years now. It's not a new revelation. But it doesn't seem like much is being done about it. We've seen a few transactions here and there where a major will do a JV with a junior for $5 million or $10 million, but nothing really major has happened.
What's going to be the end game in the gold sector? If the status quo keeps going as it has, and nobody invests in new exploration, then how will senior producers replace reserves?
Eric Coffin: The end game is inevitable. We'll see. I'm not someone that will use the phrase, although I'm about to use it, “peak gold,” peak copper, peak anything. I've always thought that was a bit goofy because, with anything, it comes down to price. Are we at peak gold? We're probably at peak gold for $1300 or $1350 an ounce prices. But we're not literally at peak gold. We're at peak gold at these prices, and at these economic conditions. If you want to see gold production go up, you either, and you can do both, you either have to make new discoveries that are economic and developable under current market conditions, or you have to have the price go up. Either one of those will work. In many ways, it’s a lot easier to envisage the price rising than currently economic discoveries rising by, say, 50%. That many discoveries would be hard.
I think, right now, the end game is inevitable. I think we're probably going to see both of those. It takes a long time to discover and prove up and develop and build a mine. I'd like to think we're going to see the price changes come before the discoveries on that. Part of the problem, and it's something that's been harped on by a lot of industry guys, of course, is that a lot of the obvious places have been looked at. The other problem that you've got, and this doesn't just go for gold, it's for all metals and anything that you have to mine, it seems like every year there's a longer list of countries that are just difficult to deal with, or impossible to deal with, either for political reasons, because of resource nationalism, because of permitting getting essentially impossible for new mining operations.
The search radius, if you will, seems to keep getting smaller. The costs go up. I don't see how the longer term end game isn't higher metal prices. But, the problem is, we've still got to get from A to B, and those companies have to try to find a way to survive and thrive in the interim. I still think, thought for years, and my opinion has really never changed on this, we've got to see two things. One is more discoveries, which of course, is easier said than done. It comes down a lot of money has to be thrown at things, spent on real exploration.
The other is that you've got to see an increasing move to high margin. Majors spent a lot of years, during and after gold went to $1900, chasing scale, and that's what the market wanted. I mean, to be fair to the gold miners, they get shit on for it now, but it's what the market wanted. That's why they did it.
Let's grab the twenty million, thirty million, forty million ounce projects, even if they're marginal crap that's half a gram sitting on top of the Andes. Let's go for it. That's over now, or largely over. Now, for acquiring companies, it's all margin, margin, margin. Quite often, those high margin deposits, on average, are smaller ones. They're not always, but on average, they're smaller deposits. Large miners will get smaller annual output additions from them, so it’s going to take more mines in the higher margin category to give you the same production levels.
I think that's where the big guys have got to go, though. I think the market, and I don't blame the market at all, is sick of these guys putting in meh financial performance year after year. They've got to go after margin. If that means they grow productions slower because they're building usually smaller, high margin mines, so be it. That's what I think they've got to do. I think that's a positive for metal prices, I just don't know when that's going to happen. That's not the sort of thing that has an easy short timeline.
Goldfinger: Right. And, in all fairness, there have been some new discoveries in the past couple of years. Not necessarily of a confirmed scale that, maybe, a Barrick or a Newmont would immediately be attracted to, but there are some companies who have made some interesting new discoveries. You follow some of them in your newsletter.
Eric Coffin: The one place where I disagree somewhat, say, with Brent Cook and Joe Mazumdar, who are, as you know, good friends of mine, so it's an “over a beer,” friendly disagreement, not a big one. I would point out and preface this by saying that those two are the ones that are the geologists, not me. If you take Canada, for instance, as an example, fairly heavily explored country because we're a country of explorers, that's what we do.
They believe, and it's a common belief, that all of the easy stuff has been found. I wouldn't disagree with most of the easy stuff being found, but my contention has always been, this is a really big place and sometimes, often in fact, a new discovery rests on a prospector walking around the left side of a tree rather than a right side of the tree. And I'm not kidding when I say that. Quite often, that's what it comes down to. A prospector steps over one outcrop instead of another, looks down and goes, ‘oh, wait a minute. What's that?’ And that can happen 3 kilometers from a headframe. I mean, that kind of stuff happens all the time.
That's part of the reason why I'm a skeptic when it comes to peak anything, when it comes to metal. I think there's still a lot of deposits to be found. But you've got to have companies going out and doing it. And I know, if you'll look at the companies that I follow, as you're well aware, some of the ones I follow are pretty early stage, but part of that's because I've got a lot of respect for companies that are willing to actually go out, to really, really go out and look for new discoveries which almost nobody does.
Everybody talks about it, but if you look at what actually happens, 90% of the work that you see is people going back to showings that have been known about for 50 years. And sometimes that works. Some companies make new discoveries based on rethinking the geology, and rethinking the structural setting, and figuring out where the best stuff actually is, and drilling in the right place. But I've always had a soft spot for companies that are willing to go out and actually, honest to God, look for new discoveries.
That's what we've got to see. In order for that to happen, investors and the sector have to be willing to back those guys. It's all fine and good for everybody to say, “we need new discoveries.” Everyone in the sector pays lip service to that idea. But, if nobody's willing to write the check, they're not going to happen. And if everybody's just going to trade ETFs, which don't actually invest in companies, they just trade the stocks on the market every day. We're not going to see any new discoveries that way, either. Someone's got to write a check to the treasury of the company for this stuff to happen. Make no mistake, the ‘true discovery’ end of the business is always the highest risk, but we need it to exist.
Goldfinger: I want to talk about at least a couple of the companies that you follow. I know that with Great Bear (TSX-V:GBR, OTC:GTBDF) and Westhaven (TSX-V:WHN, OTC:WTHVF) we've probably both been a little surprised by the extent of the recent downside. What are your thoughts on both of these, or either of these companies right here? And I know you had first bought into both of these well under the current share price, but they obviously went up substantially from the time that you first mentioned them. And since then, we've seen those stocks roughly cut in half. Maybe Westhaven a little bit more than Great Bear. Is this just a standard thing in the junior mining sector? Just a standard shake-out that we should expect at least once a year? Or is there something more here? Is something wrong with these stocks now?
Eric Coffin: I don’t know whether there's something wrong in the big picture that will keep them from getting where they hoped to with their projects, since it's too early to tell in both cases, actually. I'm not assuming there's something wrong. I'm personally not assuming there's something wrong in either case. Both of them, in a sense, are kind of a victim of their own success.
At one level, I kick myself for not pushing subscribers to take some money off the table. Although, certainly in the case of Great Bear, I did mention taking some profits, the stock is up about 700%, so, I mean, surely, I don't have to belabor the obvious here, people. This thing shouldn't owe you anything. In both cases, they just had such spectacular early drill results and, ironically, they’re paying for that now. The law of averages almost made it certain that they were going to have drill results that were less impressive, but less impressive and uneconomic aren't the same thing.
I think Great Bear management is particularly frustrated. And I don't really blame them. I mean, everybody's so focused on Hinge, and Hinge is one of the zones on the Dixie property. It's the one that's definitely generated the most spectacular drill results. And some of them have been just ridiculous, over a kilogram of gold, in some assays. And that is a very classic, high-grade, Red Lake gold shoot. It's the kind of thing that the big deposits of Red Lake will all be built on. But, as management's been trying to tell people, and they're right, I think, you have to remember that most of the big high-grade gold deposits in Red Lake aren't built from one of those shoots. They're built from a bunch of them.
As well as drilling more at Hinge, they've been working on trying to find more shoots. I actually thought the news they put out on Dixie Limb a couple weeks ago was extremely interesting and extremely positive. Because it appears that they have found a gold control there. And I won't go into all the details, but Red Lake geology is complex as hell. Essentially, it looked like Bob Singh has found a gold control at Dixie limb that is controlling some deeply plunging c high-grade shoots within the broader, sort of lowish, moderate grade, Dixie Limb zones where he thinks he's got a dependable, different plunge that he can chase now to hit thicker and higher grade gold intersections.
And that's precisely what Great Bear needs to do. They need to find three or four of these shoots and hopefully more, but three or four of them ideally at least, and just keep adding ounces as they go deeper because Red Lake tends to have very, very deep depth extents. And if you find good shoots, they can go for a really long way. I think they've got two or three of them.
I think the market completely missed what they were trying to say. I know they did. I talked to Chris Taylor a couple days after that release and he was extremely frustrated. He was wondering if what he said in the NR didn’t make sense? I said, no man, I knew what you were trying to say. I'm a little surprised at the way the market reacted too. I'm not concerned at all about Great Bear. I still think Great Bear is going to have a multimillion ounce resource. It just takes a lot of drill holes. That's Red Lake. That's how it is.
I think we're just seeing a fairly common disappointment from short term traders on an exploration story saying, “Isn't every drill hole going to be two meters of a thousand grams?” Well, no. That's not how it works. It would be nice, but no. That's not how it's going to happen.
Goldfinger: How does a company manage that news cycle? In terms of, ‘If we hit something fantastic. If we hit 40 grams per tonne over 20 meters, we're going to rush it out to the market very quickly. But if we hit a bunch of mediocre to poor holes, then obviously we're not going to speed that out to the market. We're going to batch it together.’ And so everybody, it seems like, is trained to this cycle of the longer assays take, the worse things are going to be so sell the stock. Don't wait for the results. And it seems like even when companies put out core pics or visual descriptions of core, it's ending up shooting them in the foot to some extent. Because, what it does, is it builds up expectations, and if those expectations are not exceeded, it's not even about meeting them, they have to be exceeded, then the stock is an automatic sell on the news.
Eric Coffin: There's a couple of aspects to this. I'm going to have to sort of unpack your question into two or three separate things. I hope I don't bore people with some of this stuff, but it's important that people understand some of these concepts. And I talked about this specifically in relation to Westhaven, where I said, “This is sort of where the rubber meets the road.” And this is the problem with core pictures and maybe overly descriptive, flowery descriptions of core, even those done with the best of intentions.
You've got a management group like that one, for instance, and they were not wrong, in my opinion, at all, to put out hole fourteen or hole fifteen on their own. Because the truth of the matter is, when you're sitting at $.23, $.24 and you drill a hole like hole fourteen, and you're looking at that core, that’s material info. There's no way that is not material information. That was material at that time and they felt like they had to put it out. And now, they find themselves in a conundrum. And this is something I've talked to Gareth about a couple of times. And I know it's been bugging him, but he doesn't see an easy way out of it. And I don't think there is one.
Normally, when a company has some success with a property, they raise a bunch of money. They start moving a much larger drill program. There's normally a natural transition where the company will start batching holes. They'll go from putting out hole by hole, to two holes at a time, or four, or six, or eight, or even ten at a time. Keep in mind, which many don’t, that the more drill holes you put into a project, the less material each hole becomes. And batching holes, almost without exception, is the way that the guys running the program would prefer to do it. I don't know a geologist personally, and I know hundreds of them, at least, if not thousands, that's ever really that comfortable with the idea of putting out single holes. They're always concerned that, good or bad, they can generate a lot of misconceptions. They prefer to be able to put out result target by target. They'd rather put out all four at once and explain what they think this means for the target.
But, you do need to weigh that against materiality. And I think, in Westhaven's case, both holes, fourteen and fifteen, were pretty material. You get 18 meters of 25 grams. That's material. You get 45 meters of 10 grams, that's material when they are effectively “discovery” holes - the first really good results from an area. They've been wanting to transition to batching holes. And they talked to me about this a month ago, at least. And they were concerned about how that was going to be perceived. They knew the traders would take the wait for assays to be a negative. And I don't think traders were wrong. Assuming the worst when results are “late” is generally the smart move. The real issue was, perhaps, management not being clear enough in advance that they were moving to batching holes. I know in one case (Hole 2 of the current program), they waited as long as they did because they had concerns about the assay accuracy. I think they were honestly quite shocked when they got the assays back. Although, it was a good hole. I think they were quite shocked it wasn't much better from looking at the core. They were expecting much higher assays.
Goldfinger: It seems that traders got a little too hyped about hole SN19-02, and it led to a big disappointment that, at least for now, has dampened Westhaven’s momentum.
Eric Coffin: Yeah. And and as you well know, I've harped on this a few times. I’ve walked through the sampling procedure a few times, both in the newsletter and I've done it a couple of times on the Westhaven channel on CEO.ca. I think I've done it on the Great Bear channel too. This is one of the reasons I get a little uncomfortable with core pictures ahead of assays myself. People see a picture of uncut core, and it's just coming out of the barrel and it's got these great gold streaks in it. The way you do the sampling, you draw a centerline and you cut the core along it, then the core on the left side or the right side goes to the lab. And it's always the left side or the right side. You don't move back and forth. You don't pick the better looking half. That's not how it works. You can't do it any other way and have sampling integrity.
In Great Bear's case it's even more structured. Because Great Bear is drilling what's called oriented core. Oriented core, the way the drill barrel is designed, it etches a line along the core that's in the same position all the way down. And the reason that Bob Singh is using oriented core is because Red Lake stuff is always very complex, structurally. You need to know exactly what the drill hole is doing so he knows exactly what the core angle is when it cuts through different structures, when it cuts through veins and stuff.
They use that etched line on the oriented core as their cutting line. So in their sense, there's even less control. It comes out of the core barrel, goes into the rack. They line it up so that the orientation etched line is sitting on the top. And that's where they cut. And they always throw, I don't know whether it's the left or the right, but one of the two, that's always the one that goes into the bag.
They told me that there were a couple of recent holes where the better looking half just ended up not going to the lab. That's just how it happens, sometimes. It's a two way street. It's a statistical thing, there should be times when it goes the other way, and they end up getting better results than they thought they would. It should all average out over the longer term.
But I think in Westhaven's case, yeah, I suspect a lot of the best looking core, the best looking half of Hole 2, ended up not going into the bag. That's just how it goes. And it's tricky. The thing to remember too, and when we're looking at core, even split core, you're looking at the outside of the core, and you're looking at split centerline of the core. But collectively, all of that stuff is only a very small percentage of the core. You're only seeing surface. That's one of the reasons why I'm not a VG guy. I don't get excited about VG. There's the odd deposit, Fruta del Norte was one, where the VG was so ridiculous that you couldn't not get excited about it. But, as a rule, I don't get overexcited. And I'm very cautious about visible gold. I'm a “show me the assays” guy because I've seen this happen so many times where companies have exciting looking core, but then the assays are like, meh. So, I try not to read that much into it.
And I think after hole two, in particular, for Westhaven, for this drill phase, I think that really kind of spooked management. I know it did. As you well know, they're very straight-up, honest guys. I think they were very uncomfortable with the idea they might be unintentionally misleading people. So they just kind of went, okay that's it, we're not going to put out core descriptions. So, now, everybody's freaking out because they didn't see the core descriptions this time. And they sold the stock down to $.55. Maybe, the guys that sold will turn out to be right, but I know they stopped because they feared being misleading in general, not based on what the specific cores looked like.
Personally, I'm not reading anything into the fact that there's no core description because they said that they weren't going to put out core descriptions. And they weren't going to put out core photos because they just felt like they'd unintentionally misled people. I don't really think they did. The pictures just were what they were. But, after hole two, I think Westhaven is just going to let the assays speak for themselves.
The problem is though, when you make a habit of putting out core pictures and descriptions and then you suddenly stop, traders are going to draw their own conclusions that the core must not look good. That’s a very logical assumption for traders to make. But, in this case, I think management made a blanket decision to stop doing it, not one based on the look of a specific set of core, though I’d agree they could have communicated that change better.
Goldfinger: And at the end of the day, the only thing that matters is the assays. And prior to hole one, they did post core pics on the website. They put a pic of the core in their presentation. And they really did try to get the information that they had out to the market. The market kind of ignored it. And then, when hole one had really exceptional grade. I mean, it's the best hole that they've drilled. Everybody was like, ‘Oh, well we should've paid attention.’ And then they put the description of hole two in there and it ended up being a disappointment. So, it seems like they can't win.
Eric Coffin: And I think that batching assays and not giving descriptions is a good idea, if they want to post core pics, I think that's fine. I don't think there's anything wrong with posting core pics. A good friend of mine works at IIROC, and I had lunch with him three or four months ago. And he's a geologist and I asked him just out of curiosity, what his feelings were about core pictures. I actually expected him to be quite negative about it. But he said, “You know what, as long as companies don't put out flowery descriptions or say things like, here's a picture of high-grade core when they don't have assays back, I don't care.” I've got no problem with companies putting core pictures out. He said, “If some guy that doesn't know what he's looking at wants to look at a bunch of pyrite, and think that those are gold nuggets sticking out of the core, I'm not his mother. I can’t help what someone looking at the pictures assumes. But if the company claims to have this or that grade when they don’t actually know that from assays yet - that I will have a problem with.”
As long as the company doesn't describe it misleadingly, they can put out all the pictures they want. But how many times have we seen it on CEO.ca where guys are freaking out about core pictures, and they're sending me private messages with core pictures. I'm looking at them going like, I don't understand what you're jumping up and down about. “Okay. Yep. It's a hydrothermal system. Nice. Got any assays? No? Okay. Whatever. I'll wait.” It's one thing if it's like a base metal project where you can easily see, say, copper or zinc sulphides. If you've got, say, a porphyry project, and you've got a porphyry geologist looking at porphyry core, a really good one, especially a project with a bunch of holes already drilled, the geo can do an amazingly accurate job of guessing grade based on looking at core.
But, looking at gold specks and stuff like that? Especially gold and semi-massive sulfides, good luck. I don't even bother trying. I'm like, “Okay, that's pretty, but it's only graphic.” I have no problem with the concept. I'm very cautious about it when people start freaking out, thinking they're seeing stuff in core that they maybe aren't. But, as long as the company isn't describing it misleadingly. If they're just going, “Here's a core pic. You wanted to see them, here they are.” I don't think there's anything wrong with that. But, I understand why geologists, in particular, are pretty uncomfortable with the idea. They don't like to feel they're misleading people, even unintentionally. And think about it, people. If the geologist who drilled the hole isn’t comfortable guessing the grade, should we be?
Goldfinger: Right. And that makes sense. What companies are you the most excited about or that you're excited about, period, right now? You probably don't want to have favorites.
Eric Coffin: I wouldn't say there's one that's absolutely jumping out at me more than the other ones are. I like Great Bear a lot. I'm not concerned about it. Again, when you talk about hole batching, I think everybody should keep in mind that's a 60,000-meter drill program. So there's not going to put stuff out hole by hole. That would be ridiculous. They would have to do a news release every day, basically.
Westhaven, I still like Westhaven a lot. Whenever I see holes like fourteen and fifteen (holes SN18-14 and 18-15 which wowed the market in October 2018), you rarely see holes like that and not have it turn out to be a resource. I think that's going to be a resource, however, I don't know how big it's going to be. I think there's room in the strike length they have now for several hundred thousand high-grade ounces. And several hundred thousand high-grade ounces has got real value, especially in that location.
I don't think the stock's overvalued, but it's still high risk because it's still a drill play, so it's going to have some big swings in it. I'm waiting with really high interest to see what the drill holes look like coming out of Aston Bay (TSX-V:BAY). And Aston Bay is actually a good counter point, if you will. I mean, it's a counterpoint in the sense that I talked to Tom Ulrich. And Tom, to use an example of another geo here, was quite adamant. He just said, “Look, I know everybody's reading into things because I'm not putting out core pics and I'm not putting out descriptions, but,” he said, “I don't care. I'm not doing that until I have assays. I'm just not doing that. I don't believe in that recent trend. I'm not comfortable with it as a geologist. If people want to take that and say that means the drill holes are lousy, he said, well so be it. I'm just not doing that. Wait for the assays.”
As I pointed out to people, again, I'm not reading anything negative into the fact Tom is not doing that. I know Tom Ulrich. He's not comfortable doing it. So people shouldn't read anything into the fact he's not putting out core pictures and descriptions, other than the fact he refuses to do core pics ahead of assays. I wouldn't read anything into what those look like. In fact, I'll be pretty surprised if they don't have a couple of high-grade holes. Tom said there were a couple of holes reported from the single past drill campaign at Buckingham that had some fairly significant lengths of low-grade gold in the wall lock, basically within pyrite in the country rock, part of the same event probably. He's as interested in that. He said, “I know high-grade is what will get people excited if we get that but I also like the idea of broader lower grade zones to add scale.”
The other thing I'm really watching for at Aston Bay, and I really hope it shows up like in the next few days because I've been waiting for it for several weeks now, is he's been working on a very expanded land agreement. He's going to be expanding the size of the exploration lease there significantly, by an order of magnitude at least. He's apparently pretty much got it negotiated with the owner, which is a lumber company. And he says they're just going through the paperwork. They're fairly complex agreements. The last couple of times I talked to him it was quote/unquote days away.
I'm hoping that gets out before he gets any drill results because I think, again, he'd like to be able to more fully describe his target, but he's not very comfortable doing it until he knows he's got the expanded land position. Like most geos, he's paranoid about somebody staking around him. He wants to be sure he's got that tied up. So, I'm expecting land agreement news first and I'm hoping when he announces that he's also going to include an actual map with more target information. Something that shows the trend, the soil geochemical and geophysical anomalies, where its still open, that sort of thing, in relation to where they just drilled. Here's the target scale in other words, which I think is bigger than market appreciates right now. That one I think can still get pretty interesting.
Goldfinger: Can you give readers a little bit of a background of how Aston Bay found this project?
Eric Coffin: Yeah. Aston Bay, their initial focus and it's something Tom still really likes and really wants to work on, is the Storm Project up in the Arctic. And it's way up in the Arctic. I mean, that's a great project. I really like that project too. But, you're dealing with blind sedimentary copper targets, which is not the easiest thing in the world. And it's very expensive to drill up there. So raising money at $.05 or $.06 or $.07 to drill that would be crazy, which he realizes.
I think Tom had looked at some of this stuff in Virginia, and the project we're talking about is in Virginia. He looked at it several years ago when he was working at Antofagasta And he liked the project, but the company he was working for is only interested in copper. The Virginia project is actually as series of separate targets, both base metal and gold. He said it's not one property. It's a data set that covers a large area in Virginia. There's a bunch of different targets, some of them are high-grade gold, some of them are VMS.
But, as it turns out, the guy that controls that data set and had done some past work on it is a guy by the name of Don Taylor. Don Taylor has become justifiably fairly famous recently. Most traders are pretty familiar with Arizona Zinc, they got taken out for $1.5 billion a few months ago by South32. South32 bought that in order to get control of the Taylor Deposit. And it's called the Taylor Deposit for a reason. It's named after Don because Don's the one who found it. Very nice guy, very smart geo. And he always kind of had this stuff in his back pocket.
I’d never really heard of the Virginia project until it was picked up by Aston Bay. I later found out, from talking to friends that a bunch of very high level geos, very successful discovery geologists, a lot of names people would recognize from other companies, were shareholders in this private Jacks Fork deal that controlled all this data. And in Virginia, essentially all of the eastern U.S really, mineral title part of and tied to surface title. And virtually all the land ownership is private. The mineral tenure is part and parcel of the land tenure so, in order to get mineral rights, you have to do a deal with the landowner to allow you to explore and allow you to benefit from whatever you discover.
The downside of that is it gets really complicated because you're dealing with land parcels and you've got to do all these separate negotiations. Tom went after the targets that he did initially for a couple of reasons. One is that they were high-grade gold targets and he's got no illusions. That's what people are most interested in right now, though Tom is a base metal guy at heart. But also, it happens to be on large scale landholdings that are controlled by forestry companies. And those forestry companies, he said, they're not hard to deal with. They think it's great. In terms of the size of their land holdings, even if BAY made a discovery and it became very successful and there was going to be a mine, it's like a pinprick in terms of the size of their land holdings and the potential gain for them off of royalty payments and stuff is quite large. The forestry companies are willing to deal.
They were happy to do it, but it's just something that hadn't been done much before. It took them a long time to find a lawyer that could even negotiate the stuff. They're a lot more complicated than just going and staking a claim. It isn't easy working through that process. I'm hoping to see two or three of these land agreements show up soon. So, Virginia was strange in the sense that the data came before the title. And because of that, BAY has been very circumspect in how they talked about it because they don't want anybody else going in and trying to negotiate for areas that BAY is in the middle of trying to get. It's an unusual thing, but it comes with a pretty good pedigree.
Don Taylor is arguably one of the most successful geologists in recent years, by far, due to his zinc discovery in Arizona named after him. The Taylor Project now owned by South32. This being one of Don's things, something Don hung onto for years and explored for years on his own with a group of friends that carries a lot of weight with me. So I think BAY's got two really interesting projects. I think he's doing the smart thing by focusing on Virginia because it's more of a year-round area. It's way cheaper to explore. The drill costs in Virginia are a small fraction of what they would be up on Somerset Island (Storm Copper Project).
So, I think it's a pretty interesting deal. And I have a lot of respect for a guy like Tom Ullrich. He's a geologist, he's not a market-side guy, really. But if you look at the insider filings on that company, Tom has bought a lot of stock. He puts his money where his mouth is, which always gets some extra respect from me. He thinks his own stock is undervalued. There's only so many that will put their money where their mouth is and step up and buy their stock on the market, which he's done many times in the last year.
Goldfinger: I met with Tom in November in Palm Beach and I was impressed by his presentation. Obviously, you can only tell the story as it is. And in November, it wasn't a fantastic story because they were going to have to raise money and stock was at $.05. It definitely caught my attention in the last few weeks and I think a lot of guys have put BAY back on their radar.
Eric Coffin: I think, like most geos, he's probably a little too paranoid about the whole “someone's going to claim jump me” thing. It's not like you're in the western U.S. on BLM land where some guy can just go and lay stake around you. I mean, anybody that wants to get ground there has to do the same thing as him, which is a long and involved negotiation with a logging company.
His sense of the guys that he's negotiating with, they're not the kind of guys that are going to turn around because some guy showed up the next day and offers 10% more. They're just not going to do that. I, personally, think he's being a little too paranoid about talking about this stuff. And it's frustrating for me, as someone that owns a bunch of it and that follows it in the newsletter, that there is no little public data to look at. Can we get some maps and stuff, Tom? Can we get some sense of scale? That's why I'm almost looking forward to the land agreements as much as the assays because with the land agreements, I think he'll finally be comfortable enough to say, “Okay, here's the full target. Here's the geophysics, etc.”
I know the target's actually a kilometer and a half, and he thinks it's probably open. That's why he's expanding the land position so much. People can't get their heads around that if he's not putting this stuff out, which he's just not going to do until he has this land agreement.
Goldfinger: Really interesting insights about Aston Bay, Eric. It’s on my radar here and I’ll be following the next couple of NRs from them closely.
Turning to Japan Gold (TSX-V:JG) and Irving Resources (TSX-V:IRV), these two companies have caught some attention, recently. One is drilling as we speak, and one is about to start to drill with four rigs. What do you think about the results that Irving put out last week from its Omu Sinter target on Hokkaido Island in Japan. Irving put out seven and a half meters of assays from one target on Hokkaido. And then, Japan Gold is going to be drilling three targets on Hokkaido as well. Then, they're going to be drilling a target in the south. And obviously, we've got news that Newmont is investing into Irving. And Newmont, through its acquisition of Goldcorp, is now a large shareholder of JG as well. Do either of these companies have your interest at all? And what do you think about the summer ahead there?
Eric Coffin: They both have my interest. Irving is one of those ones where I'm kind of kicking myself, honestly. Because I always liked it and I've known Quinton for a long time. I'm very fond of him. I think he's one of the smartest guys I've ever met, I really do. I could never really get behind Novo, but notwithstanding that, I have a huge amount of respect for Quinton. What held me back initially on Irving is that the damn stock would never go down. And I wasn't sure about permitting timelines.
I was held up a bit, at first, because I wasn't convinced the permitting process was going to be short. I thought it would be very, very long, to be honest. So, I just didn't pay as close attention as I probably should have. And even now, I look at it and I'm very impressed by Irving, but the market cap's kind of like, ugh. That said, the hole they put out, though almost all the grade was within a 0.3 meter intervals, it was a hell of a good intercept in that 0.3 meters.
So, I thought it was quite interesting to see that kind of grade where they are still high up in the sinter. It looks like it's probably a fully preserved epithermal system. The sinter cap is the top of the systems. It's where the fluids flow out, essentially, at the paleo surface when they're being created and cool off, and you just get these big areas of silica flooding and sinter terraces. And getting that kind of high-grade up in the center terrace, while it doesn't guarantee you're going to have a good system, but it definitely ups the odds. I don't blame people for buying the stock based on that. They've got to get down quite a bit deeper to get into the real guts of the system.
I don't know as much about Japan Gold, but I think that they’ve got similar systems. And Quinton also pointed out to me that Omu is a big system. So, it's a really nice looking story, just not a cheap one until they have more results. So, they both have my attention. I've got to sit down and go through both of them again. I mean, Japan Gold's moved a little bit less. It never had the share structure that Irving did. Irving had great structure and great shareholders from day one. And they just never bloody sold.
Goldfinger: Yeah. It's amazing actually the way Irving was able to keep the share price around $1 for so long, despite the fact there was really very little news flow. Most juniors could not have held a $40 million market cap for that long with no drilling and, really, relatively little news. And that's really a testament to the share structure and obviously the management team.
Eric Coffin: Yeah. They had really good people behind it that were smart enough to do largish, at the time, financings back when there was definitely some early glow from the Novo stuff that probably helped a lot. And they were just really well-placed stock. I was following it. I was following it all through 2018. I was just like, “Go down. Go down. Go down.” And it just never went down. It was just funny. What's a guy got to do to get a bid hit on this stock? That just shows you how well put together it is.
Goldfinger: Exactly. Let's finish off with telling us about the HRA advisory and the two different products that you offer. And, also, I think you have a conference that's coming up.
Eric Coffin: HRA Advisory, which I still think of it as the Hard Rock Analyst, its original name. My late brother, David, and I started it back in '95. I did the stocks, and he did the rocks. I've got a finance background, a finance degree. Dave went to Haileybury School of Mines, which was a Canadian mining school in Ontario. Essentially, our philosophy from day one is that we would stick to the explorer, developer end of the segment. We didn't see any point in following producers that you can get a hundred in-depth brokerage analyst reports on. We weren't going to add any value there. We thought the value was to be found in looking for stories that maybe hadn't got the market's attention yet. Try to find things where I think there's room for a hundred percent gain in a twelve to 24-month time frame because that's the kind of gains you've got to be looking for with exploration stocks because of the risks. There's no point if you don't see that kind of gain potential.
I, essentially, offer two products. One is the Journal, which comes out about twenty times a year. That's where all the editorial contents is, and where most of the updates show up. And I'll spend a little more time talking about the development stage stuff, normally, in the Journal. It's just, normally, the releases that come out of those companies, unless it's like a new PEA or something, they aren't ones where it's necessarily going to have a big market impact. So, you don't need to worry about not hearing about it for a week or two.
The other product, and you get the journal with it, is an alert service called HRA Special Delivery. obviously, as it's an alert service, there's no schedule to it. You might not see one for four or five weeks. Then, you might get four of them in two days because it's essentially news-driven. Most of the time, when I initiate coverage of a new stock, it'll be in the alert. It's almost always going to be based on exploration news or impending exploration news, something new that I feel I've got to react to fairly quickly.
And normally, that's where the updates on drill speculations and the earlier stage stories where the individual news releases have a bigger impact will be seen first. The alert's geared a little bit more towards people that are traders and that are going to be making shorter-term trading decisions, or simply moving money around more. I mean, if you're not really a trader, it doesn't really make a lot of sense. The journal would make more sense for you.
Goldfinger: I recall last year you had a couple of really nice trades in the special alert where you put out a buy on Great Bear. I think it was a couple days prior to really good results. And that was when it started to take off above $.50, actually jumped above $1 the day of the results.
And then, on Westhaven, you started covering it when it was just breaking out of that multi-year basis. It was really interesting, to me, how the fundamentals and the technicals on Westhaven sort of came together where it was breaking out above $.25 for the first time, basically ever, and that was a multi-year base where the stock has been basically trading between $.10 and $.20 for many years.
WHN.V (Daily - May/December 2018)
Eric Coffin: In the case of both of them, they're both sort of interesting stories, in the sense of, why did I start covering them when I did. I owned a little bit of Great Bear, not much. I mean, I liked the guys. I liked the guys and I liked some of the early drill results. My main concern, initially, with Great Bear, was whether they could build a resource because Red Lake's really, it's complex. It's one of those places where you take almost any project the size of Dixie, and there's going to be a few showings on it that are 50 grams. And that's Red Lake. That's just how Red Lake is.
Going from that, to we can actually build a resource, is a totally different story. And those guys had been hitting on me for months. In their case, it was really Bob Singh walking me through the reinterpreted 3D model that he had done, and he explained how he got out and they realized that a lot of the old drill holes were incorrectly plotted. One of the problems with Red Lake is a lot of the rock is very magnetic. So, if you're doing everything with compasses, you can get really screwed-up readings. And he basically went back and started doing gyroscopic surveys, which aren't affected by magnetism and making sure he had the right collar locations where possible, the right depth, the right orientations as the drill holes went down.
And he replotted all this stuff. And he showed me his plots. And I was like, “Holy shit, that kind of hangs together.” And he goes “Yeah, that's what I've been telling you all for months. This thing actually hangs together.” It looked like it was kind of spotty and all over the place when you looked at the historic results, but he said when you look at the corrected locations, this stuff all starts to line up.
It was a combination of that, plus the fact that they were just excited. And they had increased their drill program from 3000 to 10000 metres. You don’t do that if you don’t like what you’re seeing. I knew they'd probably hit VG (visible gold), since you often do in Red Lake. I wouldn’t have cared much about that either way as I’m a “show me assays” guy. It was more the fact that it looked like they might actually put together a million ounces at Dixie Limb. I didn’t know if it would be an exciting million ounces. I mean, the grades were okay, but not fantastic. But, still, a million ounces in Red Lake, even at moderate grades, is worth more than the 10 million market it had at the time. And they still had money, a great share structure and I knew, and respected, the members of their board. So, I wrote it up and it was a very long alert because I had to explain how I got from A to B in it. And I think that generated some buying, which was probably unwelcomed for them at the time but oh well.
GBR.V (Daily - May/December 2018)
Westhaven was similar to this. I'd known the Thomases, the family, not just Gareth, but Gren and Eira I've known for a long time. I owned the stock and had bought early placements. I mean, they were almost sort of “buy because they were friends” placements, to be honest, the earlier ones. I really like those guys. I always liked the fact that Gren's another guy that totally puts his money where his mouth is. Those guys did so much of the funding themselves. It was hard not to like them and respect what they were doing.
But with me, in that case, I had no problem buying it myself. But, telling other people to buy it was a bit different. And what really won me over, in that case, wasn't the Thomases. I was won over by them years before that. It was really talking to the geologist that they had brought in the year before, Peter. They had already put up descriptions saying of fourteen and they put up these core photos and it looked really impressive. And I was like, “Okay, it looks like there are a couple of good holes coming, but they have hit high grade here and there in the past. Why is this different from the other high-grade hits he had here and there for the last five years?” And Peter walked me through his whole reasoning behind moving the drill, changing the orientation of the drill holes, picking the vertical elevation of where he wanted those drill holes to pierce this vein set.
And this was all based on his experience working at a high-grade gold mine in Russia (Kupol) that's very similar geologically. It wasn't the VG. It was him showing me the alteration minerals. And him saying as soon as I drilled this hole, I think it was hole eleven, I knew I was too deep in the system and that the drill hole orientation probably wasn’t optimal either. He’d already gotten a short high-grade hit. But, it wasn't so much the high-grade, it was him showing me the core and going, “You see this pink feldspar? This is what you always get below the ore zones in this mine in Russia.” I knew I was too low, and I knew from the way the core looked coming out, that I probably wasn't drilling the right angle. So, I shifted the drill orientation. I did it a shallower angle so I was going to hit it at what I thought would be the best elevation. And that was hole fourteen.
And when he went through the explanation and his reasoning I was just like, “Holy shit, I'm in.” That's when I wrote it up. Obviously, the high-grade holes came a week or two later. It's not like it was a big secret, hole fourteen was going to be good. I mean, the guys were running around Vancouver waving their arms. It was Peter's description of it that made me think they finally figured Shovelnose out, after six years. He only spent the last year and a half on it, but it looked like he finally cracked the code. That's what got me excited.
Goldfinger: And that was really interesting how that came together. At the beginning of August, nobody cared about Westhaven. They were drilling, but nobody was really following the story. Nobody was commenting on the CEO.CA channel. And then, by September, we started to see some action in the stock, WHN started to carve out a little bit of an uptrend. And then, you obviously had the conversation with Peter at some point in September, and then put it out as a buy in your Special Delivery service and we saw it make new highs. And then, they started to put out news. I think it was hole twelve (SN18-12), that was the first hole that really caught the market's attention.
Eric Coffin: Yeah. It was really high grade, but it wasn't thick. But the grades were like ‘Whoa, that's a pretty good hole.’
Goldfinger: Yeah. It was a really high-grade hit. And also, the description of eleven I think was in that news release as well. And that helped to explain why they had shifted their orientation and then, obviously, hole fourteen. And fifteen came out in October and really set the market on fire. To have two holes like that, back to back, really is quite exceptional. Especially, when this was sort of like a blind hit. They're drilling into 90 meters of overburden, and they didn't really know what they were going to hit. They really had no idea.
Eric Coffin: What impressed me so much, was Peter described to me his thought process. And this was before the assays were out, about why he changed orientation. This is why he changed the elevation. And it was just kind of one of those ‘holy shit’ moments. I mean, that's actually really impressive. I said to him, at the time, and I wasn't kidding, “If this thing turns into a real resource, if somebody else isn't recommending you for the Spud Heustis award,” which is an exploration award locally, “I'm sure as shit going to because this is brilliant.” It's really impressive the way he did this. It's hard to get across to people that this thing is sitting under 60-80 meters of overburden. They can't see anything.
Goldfinger: Yes, it really is impressive.
Eric Coffin: It's really quite an impressive discovery. And I've had friends of mine, very high level geos, whose opinions I have a lot of respect for, that went and looked at it. And one of the guys, I won't name him because he's involved in some other stuff, but he's a friend of mine, and I asked him, he was quite curious about it, and I said, “Do you mind going to look at the core because they have it sitting in their office?” And he went and looked at the core and called me that night, and he's one of these guys whose normally, he just shits on everything. I mean that was his job, he was in corporate development for a couple of the majors, and his job was to look at projects and shit on them and say we shouldn't buy them. But, he called me that night and I was kind of like, “Okay, what did I miss?” And he was like, “I'm buying this tomorrow morning.”
Eric Coffin: It cracked me up. I was like “Who are you? What have they done to you? You never say that.” He said, “I don't know where this thing goes, but these drill holes are ridiculous.” He never sees stuff like that.
Goldfinger: So, this was hole fourteen core that he took a look at?
Eric Coffin: Yeah. It was hole fourteen. The grades were out there. This was after the news release. I think he looked at it, and it's the scale of the veining and the consistency across the veining that really impressed him. Seeing fairly consistent, but high, grades over such a broad interval. He said, “I don't know how far this thing goes, but it's going to have some ounces in it. There's no two ways about it.” He said, “I don't know whether it's going to be a half million ounces or five million ounces but I don't think this is a flash in the pan.”
Goldfinger: Thank you for your time today Eric and I appreciate the candid insights you shared in this wide ranging conversation. I know I learned a lot from this conversation and i'm sure readers will appreciate it as well. Until next time!
Disclosure: Author is long GBR.V, JG.V, and WHN.V shares at time of publishing and may buy or sell at any time without notice.
The article is for informational purposes only and is neither a solicitation for the purchase of securities nor an offer of securities. Readers of the article are expressly cautioned to seek the advice of a registered investment advisor and other professional advisors, as applicable, regarding the appropriateness of investing in any securities or any investment strategies, including those discussed above. Westhaven Ventures Inc. is a high-risk venture stock and not suitable for most investors. Consult Westhaven Ventures Inc.’s SEDAR profile for important risk disclosures.
EnergyandGold has been compensated for marketing & promotional services by Westhaven Ventures Inc. so some of EnergyandGold.com’s coverage could be biased. EnergyandGold.com, EnergyandGold Publishing LTD, its writers and principals are not registered investment advisors and advice you to do your own due diligence with a licensed investment advisor prior to making any investment decisions.
This article contains certain forward-looking information and forward-looking statements within the meaning of applicable securities legislation (collectively “forward-looking statements”). Certain information contained herein constitutes “forward-looking information” under Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “expects”, “believes”, “aims to”, “plans to” or “intends to” or variations of such words and phrases or statements that certain actions, events or results “will” occur. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed by such forward-looking statements or forward-looking information, standard transaction risks; impact of the transaction on the parties; and risks relating to financings; regulatory approvals; foreign country operations and volatile share prices. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Actual results may differ materially from those currently anticipated in such statements. The views expressed in this publication and on the EnergyandGold website do not necessarily reflect the views of Energy and Gold Publishing LTD, publisher of EnergyandGold.com. Accordingly, readers should not place undue reliance on forward-looking statements and forward looking information. The Company does not undertake to update any forward-looking statements or forward-looking information that are incorporated by reference herein, except as required by applicable securities laws. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions. Junior resource companies can easily lose 100% of their value so read company profiles on www.SEDAR.com for important risk disclosures. It’s your money and your responsibility.