Learn more about SEGO RESOURCES (TSXV:SGZ) in this new interview, https://youtu.be/CZEa6Hrj7yQ
Peter Bell: Hello, I'm Peter Bell and I'm here with Mr. Paul Stevenson and Charles Funk from SEGO Resources. Hello, Paul!
Paul Stevenson: Hello there.
Peter Bell: Very nice to talk to you the first time. SEGO Resources is also new to me too. I can give a shout-out to Charles -- thanks Charles -- for bringing this company to my attention.
Charles Funk: My pleasure.
Peter Bell: Great work on the company presentation materials and on the website, you guys. There is an impressive amount of information there. To me it looks like a very compelling plan and basis of inform from which to work here for porphyry exploration in southern BC. If I could a question to you, Paul, please can you speak briefly about the company and maybe the question of old data -- has the project been drilled to death or anything like that?
Paul Stevenson: No. There was some old work in the days of the Ingerbelle mine, which was the high grade portion of Copper Mountain. At that time, the area that SEGO now holds was made up of a numerous quantity of small claim holdings. Silver Standard did some work at one corner. Granby Mining worked in another area.
Paul Stevenson: After the Dave Barrett government in British Columbia 1971 or 72, mining shut down a lot during that period and the claims came open. Two prospectors -- Doug Hopper and Doug MacLeod -- staked the claims to cover the whole area. They each had their own block and worked on it for many years. The two of them brought it to me together and we were able to tie-up this big block in one agreement and begin a a scientific search of the whole system. It's a huge system, over 2500 meters by 2,000 meters of alteration -- strong alteration. We began work in 2008, steadily defining and getting more information.
Peter Bell: Wonderful, thank you. One of the lines in the news release yesterday that jumped out at me was mention of years spent collecting the data that you've put together for the project. Wow.
Paul Stevenson: That's right. We started off, typically, with geochem surveys. We put off IP because Copper Mountain was using the Quantec Titan 24 IP and we wanted to see if it worked before we used it. They seemed happy with it, so we did the same. A lot of our trenching, actually, were old bulldozer trenches that were dug in the '60s and never reclaimed! A lot of them didn't hit rock.
Paul Stevenson: The surface rights are held by rancher and we promised her we would re-dig those trenches, get them down to rock, map them, and then do reclamation. For that work, we received an award for Best Reclamation of British Columbia in mining exploration in 2007. Most of our trenches were really digging old trenches that never got to rock and then reclaiming them properly.
Peter Bell: Good work! Glad to hear that, thanks. Another example of all-around high quality exploration work here with SEGO at Miner Mountain. And this really is a flagship -- there's nothing else in the company?
Paul Stevenson: No. It's a huge target and it'll take money to develop it. We didn't want to get property rich and lose focus. There's enough there for one company to work on.
Peter Bell: 2019 was a productive year. Well done. And the year is not over yet! Charles, what next?
Charles Funk: For people who are new to the story, I'd like to introduce them as it was introduced to me. I'm an advisor to SEGO. The reason I'm an advisor to SEGO is that twice over the last ten years I've tried to buy this project. I was joking with someone yesterday that if you can't beat them, join them. We agreed to some options and I've joined as a technical advisor. The thing that always stood out to me on this property is that there's a big area of alteration that goes under till cover. There's some pretty spectacular grades in drilling and trenching, albeit small, but the story hasn't been well told.
Charles Funk: The guys at SEGO have done a lot of work over the last few years and put the data together that have allowed us to get to this point, which we'll talk about over the rest of this call. If all that background work hadn't been done, then we couldn't get to the point where we're talking today about about this opportunity ahead for SEGO.
Peter Bell: Certainly. I appreciate in the presentation deck that slide 15 has the project map, the target areas marked out, locations of old drill collars, and some planned drill hole locations. Stepping back and looking at all that information from a high level was really helpful for me to understand what's been done before and what you're looking at doing. Powerful stuff there for me that helped a lot.
Charles Funk: And if you pull back a bit further, Miner Mountain is just north of Princeton. 15 kilometers north of the Copper Mountain Mine. I think everyone's familiar with the Golden Triangle -- that's the sexy area in in British Columbia. But if you if you look closely on slide four of SEGO's presentation then you'll see that most of the copper produced in this province actually comes from south central BC. I think that if some of those mines were a little newer then people might have an appreciation of some of the high grades that were in Highland Valley and New Afton. J. Paul just referred to the Ingerbelle at Copper Mountain, which had high grades. I think, historically, there's been a misrepresentation of the grade of some of the porphyry systems in southern BC -- if they were found as new discoveries today, I think nearly all of them would be considered tier one copper discoveries.
Charles Funk: Consider the benefit of that to SEGO, being only 15 kilometers away from a very hungry mill at Copper Mountain. That mine is getting later in it's mine life -- even a smaller resource at Miner Mountain would probably be of significant interest to Mitsubishi and Copper Mountain, the owners of the Copper Mountain Mine. I think our hurdle for success is lower than some other projects, particularly some of the infrastructure-poor projects in BC.
Charles Funk: And in terms of exploration, the project was first recognized for it's copper potential over 100 years ago. In fact, they were mining for coal in the basin just off the Princeton and they tunneled directly from coal into copper, which is pretty unusual. That prompted a search for the copper exploration. Some of the most significant work was done by a company J. Paul referred to called Granby, who showed that there was copper porphyry mineralization on the property. Then, that fragmentation of ownership that J. Paul talked about meant that it never saw any sort of systematic exploration until SEGO picked it up in the mid-2000s.
Charles Funk: SEGO has shown some fantastic holes, like the 100 meters of 0.95% copper and 0.55 grams per tonne gold. When I first looked at this, we could see that was in structural zones in the country rock. They hadn't identified in the drill core the porphyry that drive that alteration and drives that mineralization. When we sat down over the last few months and compiled all this data, we've got a couple of really compelling targets.
Charles Funk: One is the Empress Zone, immediately to the northwest of this area. It's got a pretty classic alkalic soil footprint with a really high gold and high copper-and-gold and supporting pathfinder elements in soils.
Charles Funk: And it's never been drilled. We're really looking forward to drilling that. Combine that with a new target to the north called Sovereign Zone. And a long-lived target to the south that is gold-rich with trenches like 10 meters at 1.2% copper and another trench with 32 meters at 0.3% copper and 1 gram per tonne gold. There has been a couple of holes, but they are not into the core of that anomaly and they dont explain the anomalism.
Charles Funk: We thought that the best way to explore this system in this big alteration zone under till cover is an RC program that systematically tests all these productive areas, which we would like to commence, subject to a raise, early next year. We will see if we can really get onto the centers that are driving this mineralization.
Peter Bell: Thank you, Charles. Paul, please can I ask you your thoughts on all these new targets. With you having been working on this project for years now, I wonder if some of this is really new thinking or how much is it kind of stuff that you had in mind for some time now?
Paul Stevenson: For most of these, particularly Empress and the Gold-Copper Target, we were getting there. We did do a trench right at the end of the drill season last year, which is in the southwest corner of the Empress Zone. We got some over 1% copper and some very good gold results there.
Paul Stevenson: One of the reasons it's nice to stop and do a data review is that when you're working on it day-to-day, you tend to do drilling where you're getting grade. When we were trying to find where this structure was going, we went easterly. We should have gone west, which we now realize. Through it all, you're building data and it takes somebody to come in with fresh eyes - like Charles has helped provide. He looked at it and said, "Wait a minute, you're coming right into this thing. Here are the targets." They're not surprising in the least, but it took a little kick to get the focus over there.
Peter Bell: Again, such a large land package. Lots of different places to look.
Paul Stevenson: Yes, and it's so altered -- it's hard to break a rock on that property without finding very strong alteration. It's a big system on a big property and now with the Charles' help we have come into some very strong targets.
Peter Bell: Charles, if I could please ask again about this slide 15. Particularly the spacing on some of these holes. We hear about a large property with a large system and we see large spacing between these proposed holes, too.
Charles Funk: Yes, and it helps to understand what I've been referring to as the "Porphyry Superhighway" in south central BC. There's a major fault that runs up through the Nicola Volcanic Belt from the border all the way into central BC. Almost consistently at every 10-to-30 kilometers, there's a porphyry center. There's Copper Mountain and then there's Miner Mountain. There's Axe, Dill-Prime, Aspen Grove, and Big Kidd just to name the few directly north. The interesting feature on all these systems is that they have a big zone of propylitic alteration, which is the broadest and most out-board porphyry alteration and all of those systems have multiple porphyry intrusions within them. They can be different grades and have different copper-and-gold ratios, but all of them -- including the mines like Copper Mountain, Highland Valley, and New Afton -- have multiple intrusions. We wanted to design a program where we can systematically test under that till cover to test our best geochemical and geophysical targets. We will use our understanding of the geology and our interpretation of the alteration to hopefully identify multiple centers in this corridor. The nice thing about an RC program is that if we hit interesting rocks, then we can react instantly and push that hole down. It's both a systematic step-out program and a discovery drilling program at the same time.
Peter Bell: And it's a large program! Forty to sixty shallow RC holes mentioned? Wow.
Charles Funk: We're fortunate that till cover is really shallow, it's between 5-20 meters across the property. We can drill a lot of holes and cover a big area. Then, push down the holes where the alteration and mineralization justify it.
Peter Bell: Then follow-up with the core program to get the structure and start putting together a deeper understanding of things. Wonderful!
Charles Funk: Exactly.
Peter Bell: Paul, I asked about this proposed program and I wonder if you've been involved in anything quite similar to this with some of your adventures in other poprhyries in BC?
Paul Stevenson: Yes, I was the CEO of a company called Booker Gold which became Pacific Booker Minerals. In fact, the Board of SEGO had been with that company right through the Preliminary Economic Assessment, at which point we left to form SEGO and work on this property.
Charles Funk: Peter, for your benefit that is the Morrison porphyry.
Paul Stevenson: Yes, that's the Morrison porphyry up by Babine Lake. I've worked in porphyry copper exploration for decades. I started in 1965. Over the years porphyry coppers are my interest. Alkalic copper-gold porphyries are quite different than what we used to be looking for in the old days, or even tens 10-15 years ago. You certainly need people with expertise in this type of porphyry environment.
Peter Bell: Thank you. Again, I appreciate some of the technical diagrams in the presentation materials explaining the basic types of alteration that you see with these alkalic porphyry systems. Mapping that onto what you're seeing at surface as well, then connecting it with the various levels of the different geochemistry -- great work. It seems like you've blanketed the project really with geochem so far.
Paul Stevenson: Yes, and we've covered it with magnetics as well. The IP has only covered half the property because it's very expensive.
Paul Stevenson: In the past, we did some thin section work on the rock. In the last years we've done quite a bit more. We've been staining to follow the potassium feldspars a lot more in the last two years.
Charles Funk: To the credit of J. Paul and SEGO, they've put 70% of all the money SEGO has ever raised into this project. If they hadn't collected that step-out data, then I don't think these opportunities would be as clear. Everyone who drills into high-grade material, whether it is copper, gold, silver, or whatever metal you are looking for, you always end up getting a little myopic because you've hit something economic and you're looking for more volume. If SEGO hadn't collected that kind of data, then I don't think this opportunity would be sitting here today as we see it.
Peter Bell: Certainly not. It wouldn't look the way it does at this point with all the different layers of information without that work. To that, I've tapped a few people on the shoulder within the last 24 hours, saying "Hey. This is new to me. Is it new to you, too? What's going on?" That was kind of the reaction for most people -- some people had a passing familiarity with the name and the project, but no current sense of the technical interpretation and plan here. Thank you.
Peter Bell: Paul, I'd ask if there's anything else to say about 2020 and the plans beyond the immediate financing here?
Paul Stevenson: Oh, yes. When Charles started, he mentions that he tried to buy the property twice. We've had offers from major mining companies, mid-tiers, and a couple of juniors. The company does not want to do the standard option agreement. We want to keep this as one project and one company. Our interest is more in an equity investment in the company to develop it. We have no intention of optioning it to a major and ultimately only retaining a very tiny percentage.
Peter Bell: And this is ground that you staked -- is that correct?
Paul Stevenson: No. This ground was originally staked by Doug Hopper and MacCloud who we optioned it from.
Peter Bell: Right, thanks. And you've completed that earn-in.
Paul Stevenson: Yes, we've completed that earn-in quite a long time ago and know own 100% of the project.
Peter Bell: And any royalties? I didn't see mention or I don't recall.
Paul Stevenson: There's a 3% percent royalty, 1.5% of which is purchasable for $1M.
Peter Bell: BC minerals exploration, what a business! Great to have a chance to talk to you here, Mr. Stevenson.
Paul Stevenson: Thanks. It's a great place to explore. I should add that the community of Princeton is totally supportive of mining. The first nations were miners prior to contact -- they mined ochre. They've been involved in mineral exploration and mining since the first prospectors came to the Princeton area. BC is a great place to work and Princeton, in particular, is an absolutely wonderful place to work.
Peter Bell: Thank you, again. Charles, thank you as well for bringing this company to my attention. Is there anything else you'd like to mention?
Charles Funk: No, thank you very much Peter. I think it's a fabulous opportunity. We're looking forward to raising the money and and testing these targets. I think these are some of the more compelling copper targets in BC.
Peter Bell: Wonderful. This has been J. Paul Stevenson and Charles Funk of SEGO Resources, SGZ on the TSX Venture. Thank you very much.
Learn more online, https://segoresources.com