Gold Newsletter
Eira Thomas, Chairman of Westhaven Gold Corp. (TSX-V: WHN), joins Kai Hoffmann & Brien Lundin on the program to introduce the gold-focused exploration company advancing the high-grade discovery on the Shovelnose project in Canada’s newest gold district, the Spences Bridge Gold Belt.
Originally aired 14 March 2024
Kai Hoffmann:
Hello and welcome everybody. Thank you so much for joining us here on the Gold Newsletter. My name is Kai Hoffman. I’m the @jrminingguy on Twitter and your co-host for today. This is the first time we’re doing this and I’m extremely excited to welcome Brien Lundin here with me. Brien, it’s good to see you. Thank you for joining me.
Brien Lundin:
Hey, Kai. Yeah, let’s see how this works with both of us on here.
Kai Hoffmann:
Absolutely, because we’ve got a fantastic discussion lined up. I’m pretty sure of it because we just had the pleasure of speaking with our guest before hitting the record button, and it’s none other than Eira Thomas. She’s the new chairperson, chairwoman, chairman over at Westhaven Gold, and we’re really excited to catch up with her because the company is actively working the Shovelnose project, just received some drill permits and from what I understand, they’re about to drill very soon. Brien, I’m sure you’re excited as well.
Brien Lundin:
Yeah, I really am. This is an interesting play. This market has provided a lot of extraordinary opportunities. Companies that have big resources, identified resources, sometimes economic supply to them that are trading at really small fractions of where they’d be trading in just a normal market, and I think that Westhaven is a prime example of that, and we’ll get into it in a little bit. But the value of this company already identified through economics is just much, much larger, on the order of 10 times larger, than what its market cap currently is. So I’m really excited to explore that with the company’s new chairman, who’s so highly regarded in the industry.
Kai Hoffmann:
Absolutely. Now, we’re going to dive right in. Let us add Eira in here on the channel. And Eira, thank you so much for joining us. Congratulations on being appointed, of course, chairwoman, chairman, really appreciate it. Thank you so much for making the time.
Eira Thomas:
Well, thank you very much for having me. I’m delighted to be here with you both.
Kai Hoffmann:
Absolutely. Yeah, and again, you’re a bit of a guinea pig. I have to admit as well, because trying this out with the two of us for the first time, but let’s dive right in and Brien gave a little bit of an intro, but we always like our guests to do a bit of an introduction to the company so that we’re all on the same level before we dive into a bit of a deeper discussion here.
Eira Thomas:
Sure. Well, I’m really delighted to be able to update your viewers on Westhaven Gold. This is a company that’s been actively exploring the Spences Bridge Gold Belt in south central British Columbia. It’s an incredibly well located historical gold belt where you had placer mining back in the 1850s and fast-forward to modern day exploration of the Spences Bridge Gold Belt, Westhaven is assembled a really enviable package. It consists of four primary projects, Shovelnose, Prospect Valley, Skoonka Creek, and Skoonka North.
And these are really following up on some of the exciting historical results from the belt where the primary source rock of this placer gold has really never been identified. So all told we have about 37,000 hectares of prospective land and the project that’s really anchoring this prospective land package is Shovelnose, and we have advanced our efforts at Shovelnose to the point where we actually have completed a PEA on one of the zones that was first identified in 2018, and that has determined that we have quite an exciting prospect in front of us with just South Zone, but the exploration potential in the belt is really completely open at this stage.
Kai Hoffmann:
Fantastic. I really appreciate that introduction, really comprehensive overview. We’re going to dive into some details, obviously, of the PEA here as well, but just to give us the holistic picture here of Westhaven, I always like asking about capital structure as the next question here so that we know, okay, this is where the company’s headed, this is potential overhangs, this is how well they’re financed. Eira, can you give us an overview there?
Eira Thomas:
Sure, and one of the things that I think Westhaven has done particularly well is its challenging times for the junior explorers is it’s managed its share structure extremely efficiently. There’s about 140 million shares outstanding at this stage, fully diluted, just under 150 million. The market cap of the company is sitting at around just under 30 million. They do have cash on hand, and we have recently announced a flow-through financing, which we did a first closing on earlier this week, which will contribute another $1.6 million into the company coffers, and that’s going to allow us to launch full speed into our latest drill campaign, which is set to begin March 18th.
Kai Hoffmann:
Oh, fantastic. Absolutely. That’s already a few days from now, so full steam ahead here. Fantastic. Eira, just quickly run us maybe a bit through the largest shareholders as well because one of the questions I asked you before hitting the record button, how are you involved?
Eira Thomas:
Yeah, so listen, this has been a big family effort. This company was started by my brother, Gareth Thomas, and supported by my father and I since inception. So altogether, family and friends control about 10%. We’ve got about 25% institutionally held and then about 39% retail and all told our directors and officers account for about 26%, so we’re heavily vested. I was super excited to have the opportunity to step in and support the company, recently joining as chairman, and it remains one of my largest single personal investments in the mining space.
Kai Hoffmann:
Absolutely. I appreciate that, Eira. Thanks for clarifying that. And I think it’s an obvious question to ask, or actually it’s a question that I think I know the answer to because you somewhat answered it already, but you recently joined the company board as chairman. The question is, of course, what attracted you to it? I know your brother is running it, of course, so it is a family affair, but there must’ve been other circumstances as well because I know brotherly love only goes that far.
Eira Thomas:
Listen, I think I’ve had the opportunity to get stuck in and up to speed on some of the technical achievements of the company over the last several years. And again, I really want to stress not just the involvement of my brother, but the team that he’s assembled. It’s a top-notch team with a great exploration, pedigree and history of success in the past with Peter Fischl on the technical side, but also a very accomplished team of geologists and geoscientists that are leading the charge there. They’ve been lean and mean over six years, which has been the mantra. Of course, being so well located right off a highway, it means you can cost effectively explore in the Spences Bridge Gold Belt very, very effectively all year round. And so they’ve really been able to put those dollars to work. And so I was incredibly impressed not only at the work that they’ve done in the South Zone to actually identify a really attractive economic opportunity, but also within the whole belt itself.
And so I think we’re just really scratching the surface here. I think that’s probably one of my main messages today. I think the company has been incredibly disciplined in progressing the project through to this stage, but I think as we see this disconnect between gold price and the junior equities, I really believe this has to change. And when it does, I think this particular belt, this particular opportunity and this particular company are really going to attract a lot of attention. And I think what impresses me most is just their ability to keep their heads down, get the drills turning and to make significant progress even in a downmarket. So lots to do here yet, but really done a great job to this point, but I think it’s the world-class potential of the whole belt that’s most intrigued me.
Brien Lundin:
Eira, you mentioned getting attention and attention that Westhaven should deserve. What strikes me about the play is really the market’s inattention, not just to Westhaven, but a lot of companies out there over the recent years that have built big resources and significant resources. You made the big discovery at the South Zone in 2018, and at that point, the market started looking to, okay, what’s the next thing along the trend? What’s the next big hit? Can you repeat that South Zone? And the market’s reaction has been really distracted and I don’t think it has really appreciated the fact that you’ve gotten equal or better hits along a number of zones down that trend. Could you explain that development to us and what the market may have overlooked?
Eira Thomas:
Yeah, absolutely. I think that’s a really good point. I think the fact that we identified a relatively small high value resource in the South Zone that’s not even about 600,000 ounces was interesting, but then when that didn’t grow immediately to three or four million ounces, the market lost interest. But you’re absolutely right. We’ve done so much work along trend from the South Zone where we’ve identified some really high grade interesting intercepts. And, of course, we are continuing to build ounces in these areas and what is going to be really important for this project, and I think what investors need to understand is that this is not the middle of the Arctic. We are right off a main highway in southern British Columbia. We’ve got a power line just to the north of the Shovelnose block, so the threshold for development here is much lower.
There’s also infrastructure in the belt itself. So I think that is not clearly understood. And as we continue to test targets along trend from the South Zone within the Shovelnose project and even within some of the other projects, we are going to be building ounces and we can build them quickly and hopefully we’ll be in a gold market that will start to take notice because I do think this is a huge opportunity. At the MIK Zone, we had close to four meters of 17 grams and 31 grams, including one and a half meters of 28 grams. These are important high grade intercepts that really speak to the world-class potential of the belt. There’s lots of room in here yet, as you both will understand.
Epithermal deposits can be challenging. There’s limited outcrop exposure here. But again, the technical team has done a great job really understanding the potential of these ore deposits, and we’re building upon that and prioritizing targets now for 2024. And one of the lenses that we’ve just recently added is the perspective of structure. We brought in recently some very well regarded structural experts who have taken a look at the work that we’ve done to date and really added to that. And a number of the priority targets that we’ll be drilling starting next week will include some of these exciting new targets that we’ve added into the mix.
Kai Hoffmann:
Where can we expect those targets to be along that trend? Can you give us a rough idea? Have you announced anything in that regard yet? I don’t know. So it’s a tricky question because I know I haven’t seen a drill update or a drill plan or anything yet.
Eira Thomas:
No, we haven’t. So I will maybe stay away from commenting too much on that. But what I would say is that we are targeting a range of opportunities. I think it’s really about taking what the team perceives as to be the best possible untested targets within the Shovelnose property and again, being extremely disciplined about what we’re testing and why. Some of it will be to build on recent success, but some of it will be to test interesting ideas within the structural analysis that could add significantly to our understanding and the discoveries to date. So it is going to be a range of targets, and you’ll hear more from Gareth and the team here in the coming weeks.
Kai Hoffmann:
Oh, fantastic. By the way, on a side note on the point of access, I’ve taken my family to Shovelnose.
Eira Thomas:
Oh, great.
Kai Hoffmann:
We made a trip, I think it was in the summer 2021. We drove up and saw a drill from a distance and everything. It was fantastic. So super easy access, made a day trip out of it, went to Hope, and just showcasing how easy it is to get there.
Eira Thomas:
And I think that’s the thing that most people… We do really encourage our larger investors or prospective investors just to come and see, because I think it really does highlight how different an opportunity this is compared to most Canadian exploration projects that are out there, whether they be BC or Yukon or the North or anywhere in Ontario. We really do have incredible access and great infrastructure.
Kai Hoffmann:
Absolutely. I want to work out a bit more, what do you get when you buy into a 30 million market cap company right now? What has been invested and what is tangible? I know you’ve put out a PEA, there’s a resource, but maybe summarize that a little bit for us because you talked a bit about the upside and target drilling, but there’s a lot of substance already in the company at 30 million market cap. So I’m curious what that is and maybe you run us through some highlights also of the PEA.
Eira Thomas:
Yeah, listen, I think the reason the company felt so compelled to move forward with the PEA is that we really did want to send a strong message that this is a company that’s committed to identifying a mineable resource and that we think the threshold for development in this area is going to be significantly lower than in other areas. And I think the PEA does a really great job in highlighting that. We have got a strong case for an underground mining scenario in the South Zone. It gives us a Pretax IRR of around 40% after tax of just over 32%. The CapEx is really manageable at around 150 million. And it, overall, provides us with a low cost, all in sustaining cost of around 750 gold equivalent ounces.
It’s not a huge resource at this stage. We’ve got a total payable metals of 534,000 ounces, but it really highlights the fact that you don’t need 5 million ounces in this area. You don’t need that kind of scale in order to be economic. So we absolutely believe we can add to those ounces along trend within the Shovelnose project itself, and we remain very optimistic about the potential for further world-class larger gold opportunities within the belt as well. So I think the PEA just, again, is scratching the surface of the potential of the belt, but it also really highlights the opportunity within a project area that is so well situated.
Brien Lundin:
Yeah, you are literally scratching the surface here. If you look at the South Zone drill intersections, and I’m looking at it right now in your presentation, you have a number of targets and zones that have met or beaten the best results of the South Zone. So I’m intrigued in that aspect to begin with, but you’re mentioning that you have other targets, so you have the potential to discover new zones here that could yield as typical high grade results that you’ve been getting.
Eira Thomas:
Absolutely. And we’re looking at within the existing identified zones like MIK, but we’re also looking at targets southwest of FMN. We’ve got Line 6, we’ve got a target called Breccia 2. We’ve got Hydrothermal Breccia 5. These are relatively untested zones within the trend that we think could be equal or even better. So there’s a lot to do here. And I think the challenge for Westhaven is not to come up with targets. It’s been about how to spend money wisely and be able to come back to the market and preserve share structure and not dilute our loyal supporters that have been following the company since 2018. And that’s something that the team has been very cognizant of. I think you could easily have thrown 15 drills at Shovelnose alone to follow up on some of the exciting targets that have been developed.
But again, each and every hole that has been planned is really been planned to answer questions, to increase our knowledge and understanding of the geology within the trend, within the belt that will lead us to other opportunities and hopefully grow ounces in a really meaningful way. So as much as we really, I think, value the South Zone and what it’s contributed so far, we still remain convinced that there is potential for larger high grade discoveries within the belt. And our mandate here now is to be very disciplined in putting those new flow through dollars to work to test the best within that trend. Any one of those could really change the outlook. And as you pointed out, Brien, there are some exceptional results already that have given us areas of focus to help build future ounces.
Kai Hoffmann:
Oh, fantastic. Absolutely. Lots of opportunity there. I don’t want to be redundant or anything, but I would just to summarize maybe the plans for 2024, the business plan as well. What are you trying to achieve? Is it a resource upgrade or resource update by the end of the year? Is it an update PEA by the end of the year? I don’t want to put words in your mouth, obviously, but that’s where the question is directed at.
Eira Thomas:
Yeah, it’s a great question. Look, we are continuing to build resources based on the drilling to date, and there’s certainly opportunity to do that. But equally important, we are getting out there to test some of the best targets within the belt to make sure that… As much as I want to say we’re focusing on building ounces in the South Zone, we feel equally excited about the exploration upside. That strategy, I think, is a twofold strategy, if you like, continue to build ounces and build on the drilling work that’s been done to date within the Shovelnose properly at large, and then make sure that we’re leaving no stone unturned, as you would say, to test the best possible targets, that could be a game changer for us within the property at large.
Kai Hoffmann:
I appreciate that. Awesome. Eira, I was fishing a little bit for a date for resource update or so, or a bit of a guidance in that regard, but it makes sense. First you got to drill, of course, and then you probably find out what you have and what you found to add it to the resource. So Brien, I see you unmuted yourself. Do you have a question?
Brien Lundin:
No, I was just listening to you, Kai, listening to you. I just think it’s a wonderful story. It’s typical of what this market is offering up to investors right now, but it’s atypical in that you’ve got, really, a world-class discovery already in the bag, a firm foundation to build upon and identify targets along that trend. I think it’s also important to note that there was big news in the granting of a drill permit that gets you something like 650 holes now permitted for, so money and permits and the trend of high grade discoveries. I don’t know what more you could want for.
Eira Thomas:
Thank you, Brien. That’s a really good point. I should have mentioned that. But that permit has been absolutely critical and Westhaven continues to work very closely within our communities of interest to bring them along in our journey, and we do enjoy good support within the belt and the group of projects, so we’re excited to be able to move forward now and test some of those better opportunities that to date, we actually haven’t had permits to do so.
Kai Hoffmann:
Fantastic. Absolutely. Eira, last question, we’re always greedy as shareholders and investors, we always want to see when the next press release comes out, ideally it’s tomorrow, but you hinted at the start of drilling here very, very soon. I’m guessing that’s the next news item, and then what do you expect in terms of turnaround maybe from the labs as well? Have they hinted at anything?
Eira Thomas:
Yeah, listen, we’re getting a pretty early start here. It’s easy when you’re located where we are. We can basically drill all year round, but we have had a big dump of snow in British Columbia over the last few days, which has slowed us down a little bit. Basically everything is in place to begin very shortly. And our understanding is that right now, the turnaround from the labs is pretty manageable, so we’ll see as we get into it. But you will be seeing regular updates from the Westhaven team on our progress with this spring campaign. And as I said, we’re excited to get in and test some of our top targets to date and some newly identified targets from this recent structural analysis. So stay tuned.
Kai Hoffmann:
Fantastic. Awesome. Eira, thank you so much for your time. I think it was a fantastic introduction to Westhaven. It’s great to introduce you also to our audience here as well, and we’ll have to make sure to get you back as soon as some drills keep rolling in.
Eira Thomas:
I’d be delighted to come back. Thank you again for the invitation.
Kai Hoffmann:
Absolutely. Yeah, let me do a bit of an outro here as well. Please stay on for just another second here, Eira. I’m just going to remove you real quick, but everybody else, thank you so much for tuning into the Gold Newsletter. This was a bit of a special edition. Of course, we did a company introduction here with Eira Thomas of Westhaven Gold, but I’ve been joined by Brien Lundin. It’s the first time we’ve done it together. I think we need to do more of those, Brien.
Brien Lundin:
Yeah, it’s fun. It’s fun. I get to sit back and listen to you talk and just chime in.
Kai Hoffmann:
Absolutely. Next time we’ll do a role reversal.
Brien Lundin:
I don’t know about that. I don’t like that. I’m liking this.
Kai Hoffmann:
Absolutely. We’ll have to do more of those. Really appreciate everybody tuning in. Make sure to leave a comment, leave a like. Did we ask the right questions because we are doing this for you? Of course, it’s fun to chat with Brien and with Eira, but make sure that we get your questions answered. That’s the whole point. That’s why we’re doing this, of course as well. And please share the video with like-minded investors and subscribe to the channel. Really appreciate you tuning in. Of course, we’ll be back with lots, lots more updates here on the Gold Newsletter Channel. Thank you so much for joining us.
DISCLAIMER: Please be advised that this interview is intended solely for entertainment purposes and does not constitute a solicitation for the purchase of securities nor an offer of securities. It is strongly recommended that readers seek guidance from a registered investment advisor and other professional advisors, as necessary, to assess the suitability of investing in any securities or investment strategies mentioned herein. Additionally, please note that the contents of this interview may contain errors.
Cautionary and Forward-Looking Statements
Certain statements contained in this presentation that are not historical facts are forward-looking statements as that term is defined in the United States Private Securities Litigation Reform Act of 1995. In addition, certain statements in this presentation may be considered forward-looking information under applicable Canadian securities laws. Forward-looking statements and forward-looking Information address future events and conditions and therefore involve known and unknown risks and uncertainties. Forward-looking statements are frequently characterized by words such as “plans”, “expects”, “estimates”, “projects”, “intends”, “believes”, “anticipates” and other similar words, or statements that certain events “may” or “will” occur. They can also be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. These factors include, but are not limited to, the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drill results and other exploration data, fluctuating metal prices, the possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future and other specific factors that may be identified in the course of this presentation. No forward-looking statement can be guaranteed, and actual results may differ materially from those currently anticipated in such statements. The Company undertakes no obligation to update forward-looking statements except as required by applicable law. The reader is cautioned not to place undue reliance on forward-looking statements.
