Serabi Gold (LSE: SRB) – Ready or Not At All, So Close Enough to Taste It (Transcript)

Interview with Michael Hodgson, CEO of Serabi Gold (LSE:SRB, TSX:SBI).

Off the back of yesterday’s press release, Mike spoke to us to give us a bit more colour on the details about the Public Hearing and the results of the first months test on the new ore sorter.

Interview highlights:

  • 1:30 – Public Hearing: A Positive Outcome
  • 3:43 – Ore Sorter: How Does it Work?
  • 9:56 – Focus for 2020: Exploration, Drilling and Building Value

Click here to watch the interview.


Matthew Gordon: Good. We saw the press release this morning, thought we’d try and catch you, and it sounds like we caught you at a good time, you’re off to Brazil tomorrow. So, why don’t we talk about the public hearing first of all which you told us about last time we spoke, but it seems to have gone well?

Mike Hodgson: Yes, yeah, I mean, you don’t get a definitive answer in the actual public hearing itself but you obviously… it could go very wrong on the day, so I mean if you have a positive public hearing in terms of like, everyone sits down and listens and all the stakeholders have the conversations and are all heard over 6-hours and there’s no… you know, it’s all done in a cordial manner, which is exactly what happened, you can’t have anything more.

So what we actually have there. It’s chaired by the State Environment Agency, called SEMAS, and they chaired it and all the various stakeholders had their say and we had pretty much overwhelming support, which was great. So they will now go away and digest all of those comments, people’s concerns, people’s wishes, people’s wants, and they will then make a recommendation to a governing body which is called KOHIMA. They’re the guys that actually, ultimately, either ratify it and take it to the board. So they’ll listen to all of the, as I say, all the comments and concerns and they’ll come back, hopefully, with an LP for us, we hope within the next sort of six to eight weeks. That’ll be a great result, we’ll be delighted to get it done so quickly.

Okay, it’s slipped a bit compared to what we hoped, but you’ll remember we had to live through all of those tailings dam problems of 2019 with Brumadinho and how that affected everybody in the mining industry in Brazil. We’ll obviously get the EIA resubmitted and the public hearing still early in 2020 and seemingly gone through in such a positive climate in a way. Yeah, I think we did a really… we’re very pleased. Very pleased.

Matthew Gordon: Well I guess you had the benefit of obviously Palito, existing business, running without any issues and you obviously had the support of the local community from that, so that all helps. And I think people mustn’t underestimate the importance of this, and we’ve certainly spoken to a few companies in the last couple of weeks who are suffering from not being able to get through the process, as it were.

Let’s talk about the ore sorter, because I’ve watched the video which kind of explains it all to me and we’ll put the link up above here now so people can go to that. Can you tell us the impact? You’ve been running it for the best part of a month and it seems to be delivering quite well. I’m looking at some numbers here, so you fed in 1,266 tonnes and you’ve identified 1,076 tonnes of waste, so that’s significant.

Mike Hodgson: Those numbers aren’t really terribly indicative. I put them in there because obviously we switched it on just over a month ago and we’ve been putting through some pretty miniscule tonnages, and we’re just playing around with it really, trying to find the sweet spot. And we’re using different types of ore. Some of the ore is actually sort of more massive sulphide ore. So really, I put those numbers in there to show people, hey, you know, it was a pile of rubbish, basically, sub-economic, very uneconomic material.

We passed it through the ore sorter and we just pulled out 200t at, like, 7g/t and the rest of it is a big pile of waste, and that just shows what this thing can do. And the video shows it, that it’s going in, you know, it’s crushed material which is 80% waste rock and if you look at underground face, underground, if you just eyeball that you can see, well hello, 80% of that face there is waste and 20% of it is a band of ore. That’s exactly what the ore sorter does. When that thing’s all been crushed it can actually eliminate all that waste and just scavenge out that sort of high-grade band of the sulphides where the Gold sits, and that’s what it does.

So I think we can see straight away it’s a very… it’s great at just scavenging out the ore out of the waste. And we won’t put our best material through it because it’s not an exact science, there are always going to be losses. Like, you will get ore going into the waste system and you will get waste going into the ore system, but I think the best way of describing it is, it is a waste remover. That’s what it is, it’s a waste remover and it’s an ore scavenger.

So we are only really using it at the moment and will be only using it until we’ve got this absolutely nailed, we’ll only be using it on our lower grade ore development, which is where we’re just driving along the belt in its most diluted materials, that’s the material with all the waste rock in, and it’s great for just recovering the ore out of that material and not having to pass all that stuff through the process pond which up until now had been completely constipating our process plans with this material.

So if we get rid of that, first of all we save ourselves, just by getting rid of that material and going for 500 tonnes a day at 7g/t, 400t per day at, say, 9g/t, you’re going to save yourself about USD$1M a year at cost which means the payback on this machine is about 18 months. But, more importantly, what it will do is it will liberate 100t a day of free space, which we can then use again to add more high grade or make our little process plant produce, instead of 40,000 ounces, which it can do today, the same plant with the same size and through-put can do 50,000 ounces. That’s the beauty.

Matthew Gordon: That’s truly remarkable. But it doesn’t actually identify Gold per se, does it? Explain to people what it’s actually doing? They can watch it in the video but I thought it was interesting to…

Mike Hodgson: Very, very important, the distinction. When you look at that video you see that yellow shiny stuff, people I know would be very excited if that was a band of Gold. It’s not. That is a band of sulphides, mostly charcoal pyrites which is a copper sulphide and pyrites which is an iron sulphide. And all of our Gold is very fine-grained contained within those sulphides. So, our ore sorter has two metals that actually split differentiating between ore and waste. What you’re always after with any type of ore sorting, whether it be diamonds or, as we’re doing, Gold, or whatever, you need contra between your ore and your waste, dark contrast. So it won’t work terribly well on a disseminated ore body? On an ore body like ours, which is very sharp, it will. So, what it’s actually doing, you crush it down to about a quarter of an inch, half an inch, so you can see there, an inch to half an inch, and you pass it through either a colour sorter or an x-ray sorter. So, let’s take the colour sorter first. In our case as you’re dealing with video, pink-based and the rest is ore. So you can just simply say, right then, I want to collect anything that’s not pink and it will just literally identify any stone that’s not pink and throw it off on to different belts as you saw in the video and the pink, the granite, will just fall off the edge as waste. Alternatively, you can sort on atomic density which is where you use the x-ray sorter, so it’s a piece of equipment not dissimilar to what we have at airports, you pass through it, and it’s actually penetrating every stone on 1mm centres, so it’s hugely detailed. And there’s a 3D sample so every stone gets analysed for a percentage or its atomic density and, of course, the granite rocks are much less dense than the sulphides and the ore rocks so, again, there’s a big contrast in density between what is the ore and what is the granite. So, again, we can sort on x-ray as well. And, if we really want, we can’t do it at the same time but we can – we haven’t tried that yet – but what we can do, we can sort once on, say, density, save the pile, and then you can pass the pile again and sort on colour. So, the permutations are endless and we’re just at the beginning of this journey really. But we’ve just simply by sorting on x-ray. It seems to be brilliantly separating the waste and putting some more add to the waste. The closing shot of the video you see that little pile and the big pile. We pulled that little pile. That’s now a big pile and before it was just lost in that big pile.

Matthew Gordon: It’s amazing. We were talking to a lot of companies about bringing ore sorters in to improve their productivity and throughput. As you say, the savings are, or can be, immense. You had a great year last year in terms of the share price. Obviously, shareholders, the share register must be quite pleased with your performance. I know you’re excited obviously about the ore sorter here but you’re obviously more excited about bringing Coringa into production. You’re off to Brazil tomorrow you tell me, before we started the call. What are you going to do?

Mike Hodgson: Well, we’re closing in on our sort of three-year, we’re doing, we’re updating our mine plans and our resource estimations. So that’s basically what I’m going down there to actually sort of oversee, have a good look at that. We’ve got some exciting drilling going on at Sao Chico. I just to make sure we can as much of those results into this resource estimate we’ve just done There will be an update coming out too some very couple of intersections on the further step outs yet. That’s not probably get the results on, quite, even the official results, but certainly it’s looking very good. We’ve got some very nice-looking introspection, visual at this moment in time so I’m going to be looking at all of that.

Coringa, a year, well that’s obviously going on very well. We’re, as you know, we talked about this last time, we have Greenstone the convertible loan note coming in at the end of next month, and that will, of course, be the catalyst to us to start work at Coringa, start on the decline and getting on the ground. And, again, the exciting thing about that is getting underground, getting the bulk sample done or getting that earth moving, see how that responds to ore sorting as well. So, I’m completely sold on the whole thing. I mean I must admit when it was all, when we all talked about it, it was about two years ago the scary thing was it basically going to amount to USD$2M on something like this was you know… Well, I don’t want it just to be an ethical success. We really hope it works in earnest. I’m completely sold. I think it’s a paradigm shift in this part of the world with all of its sulphite hosted Gold deposits. It’s going to be terrific.

Matthew Gordon: I think that’s what the shareholders bought into last year when the share price was moving rapidly up having been stagnant for so long. A couple of million bucks and a payback of, as you said, less than a couple of years, 18 months to 24 months. Fantastic. But, also the ability to double your production and get up towards that wonderful 100,000 ounce a year number it has got to be in the crosshairs for you. I mean Coringa could get you up to 80,000 and with your exploration at Sao Chico you’ve got to be aiming higher, haven’t you?

Mike Hodgson: Yes definitely, I think the ease of mining at Sao Chico ore body, that’s why we put a lot of effort on exploration now. We obviously get a bigger bang for our buck with our exploration work that we do there. If we do get a bit of a tiger by the tail there and, at the same time, the space that we’re liberating by cleaning up the Palito ore creates more space to put through more Sao Chico ore, but we’re not dismissing the possibility of being able to sort the Sao Chico ore as well. It might be a different way of doing it, but we are beginning to get some pretty good results on that. So, it’s three deposits. Coringa, Sao Chico and Palito as being sortable in the end. We’re going to squeeze, I was always saying, my comment there, low-grades and tonnes cost, we’re always going to try and get the grade up as much as possible and not just chase scale but chase quality so we can actually get to, you know, 100,000 ounces with mining as high a grade as possible so we don’t actually have the enormous through points that a lot of 100,000 ounce producers have to have to get that level of production. That’s the name of the game.

Matthew Gordon: And that’s the focus for this year or, have you got more surprises on the horizon?

Mike Hodgson: I think if we get a nice big resource increase at Sao Chico and we get successful or we get on the ground at Coringa and we bring back a bulk sample and that works very well with the ore sorter and Palito’s achieving its 45,000oz, I’d be very happy with that outcome.

Matthew Gordon: Very good. Thanks very much. I appreciate you taking our call with regard to this morning’s press release. We were keen to speak to you because it was one of the stories, success stories, of last year, certainly in terms of share price, which is the name of the game after all. So, we’re kind of keen to see how you get on this year and see if you can repeat that success. Stay in touch.

Mike Hodgson: I will Matthew. 


If you see something in this article that you agree with, or even disagree with, please let us know in the comments below.

Any advice contained in this website is general advice only and has been prepared without considering your objectives, financial situations or needs. You should not rely on any advice and / or information contained in this website or via any digital Crux Investor communications. Before making any investment decision we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice.

Serabi Gold (LSE: SRB, TSX: SBI) – You Broke The Bonds, And You Loosed The Chains (Transcript)

Serabi Gold - Palito

Interview with Michael Hodgson, CEO of Serabi Gold (LSE:SRB, TSX:SBI).

2019 was a good year for most gold companies, including Serabi Gold, who saw its share price treble. Now Serabi is looking to push on to achieve the Gold returns shareholders will demand.

Serabi’s debt to Sprott Lending Partnership, c. US$6.5M, and Equinox Gold Corp., US$12M, has been looking. Rather than raising equity to resolve the problem, Serabi Gold has opted for US$12M of convertible notes with existing shareholder Greenstone Resources, which will enable them to pay back Equinox. The remaining debt owed to Sprott will be settled from cash reserves. This wards off dilution for now, but if Greenstone decides to convert notes into shares rather than cash that would suggest the company has delivered on its production targets and the share price has bounded on further.

Serabi Gold will now look to push forward with the development of Coringa, which is geophysically and metallurgically similar to Palito, but with a higher gold grade of 8.34g/t. They will likely use their freed-up cash flow to bring Coringa through to production by Q1/21, with the target of a combined, cross-mine AISC of c.$950. Investors will want to see eventual production doubled.

Serabi will use the majority of the c. US$14M in the bank to develop Coringa, introduce an ore sorter at Palito and continue exploration at Sao Chico. Serabi Gold appears to be well set up to build on last year’s 40,000oz+ gold production figures. Let’s keep watch and see if they can deliver.

Interview highlights:

  • Press Release: $12M Convertible Loan
  • What is a Convertible Loan and What Terms Bind it?
  • Had They Looked into Equity Options Beforehand?
  • Greenstone Group’s Support
  • Year of Delivering: What Will They Do With the Money?

Watch the interview here.


Matthew Gordon: You have a press release out this morning: USD$12m convertible note. Why have you done that?

Mike Hodgson: I think everyone will know, Serabi investors and people who have been following us, that we have the Coringa project which we have been advancing, making good permitting progress. It’s a very similar deposit to our Palito operation, so we see it as quick organic growth. We are working through the permitting process and have a license to start the underground operation and that is something that we are eager to do. One outstanding condition on that has been that we have one final payment to make to the company we purchased the asset from, called Equinox. They were called Anfield in the past, but they have since become Equinox, and we owe them USD$12m. Whilst we are eager to start our underground operation at Coringa, it is something that we wouldn’t be comfortable doing until we have fully owned the asset. So the payment will be used to settle the final payment to Equinox which is going to be happening, all being well, at the end of February 2020.

Matthew Gordon: And you also have debt with Sprott outstanding. Will you be tackling that or is that something you can roll over?

Mike Hodgson: The good thing about this USD$12m convertible loan is that it frees us up to use our own cash. We have been running up our cash position quite nicely during 2019. We opened the year with USD$8m and we ended the year with over USD$14m. We have been building up cash. The whole idea, the original intention was to build up that cash as much as possible and to actually make the Equinox payment, but instead, we will use that cash to pay off Sprott, and to actually end that debt as well, which is sitting at a little over USD$6.5m. We will pay that out of cash flow; this is what this convertible loan allows us to do. It liberates our cash to do that, and continue with our various work programs at Palito and Sao Chico. We are actually drilling a lot to try and increase the Resources and to fund that underground development which we are going to do at Coringa from Q2 onwards in this coming year.

Matthew Gordon: What is a convertible?

Mike Hodgson: Okay, well, a convertible loan is essentially money where a lender puts money to the company on a condition over a term, in this case, 16-months, they then have the right to take shares, at a pre-agreed price, the exercised price, which will be set at the beginning of the loan. In other words, in the next few days, they have the right to actually acquire those shares at a fixed price, at the end of the term. They may want it to be converted, so in this case, it would be fairly close to the market price, but they could choose to actually get paid back in cash instead. The company also needs to demonstrate that they can pay the money back in cash as well. At 16-months, cashflow is actually strong enough to do that, but we would obviously expect the conversion with Greenstone to take it in shares.

Matthew Gordon: It is at their election; if your shares are moving up, or if they feel your shares will probably move up, they will elect to take shares. Or they could just treat it as debt and you repay them at the end of the term if you have the cash, or perhaps you refinance it if you didn’t have the cash.

Mike Hodgson: That’s correct.

Matthew Gordon: It is an interesting device which some Juniors use. Did you look at the option of equity, because I imagine that last year, or towards the end of last year, it was a tricky period for equities? I think most companies were asking for a 10% to 15% discount. Did you have those conversations?

Mike Hodgson: We did. Last year started, production-wise, we had a terrific year and as I just said, we generated cash; we generated USD$6m to USD$7m during the year, which was a great effort. We had a poor share performance in Q2/19 when we had two shareholders: one an institution in London, and one a private lender, invested some time ago, both selling their positions and that really took our share price through an all-time low for the last few years of £0.23p. So, at that point, equity was absolutely out of the question.

Despite that, we did see a price recovery during the year. Serabi, like many Juniors has suffered over the year, with liquidity – we did actually find over the second half, on this Gold run on H2/19 – we saw a lot of investors come into the stock and that really drove the price up. For once, in quite a while, we had some real liquidity, share price went back up to about to £0.70p/80p range, which certainly brought the prospect of equity into question. But having investigated it, speaking to the brokers, the board, major shareholders generally, it was still expensive money. Most of the equity deals kicking around wanted 20% discount to the market, so it was still going to be quite an expensive way of doing this.

So, Greenstone; they are fairly new investors with us. They have been very supportive. They offered us a convertible loan, so it seemed favourable, the cheapest money and the best option to take.

Matthew Gordon: Quite an endorsement by Greenstone. For people who don’t know who Greenstone is, they are a geologically technical fund in London. This takes their position to 37.8% potentially, or something like it.

Mike Hodgson: Yes.

Matthew Gordon: So quite an endorsement from them. You must be pleased to have them onboard and supporting you?

MIKE HODGSON: Absolutely. They took a big role in our company in that we have regular technical discussions. We have had a lot of support. They have got a good engine room; people who we can call on. They have obviously got a huge reach in terms of things that the company can be doing as well. They are super helpful and it is good to have a shareholder of that type of calibre in our stock.

Matthew Gordon: Smart money with deep pockets. Very nice. Can we talk about what you are actually going to do with the money? You have talked in the past about obviously getting into production. I also want to look at what you’ve been doing at Palito and Sao Chico because you have talked about exploration in the past, so what is happening this year with this new restructured Serabi Gold company?

Mike Hodgson: Yes. Well we are really, really busy at the moment. We had a great year. We broke 40,000oz for the first time ever, which was a huge achievement. We ended a quarter, Q4/19 with another 10,000oz which was really pleasing. So that means that 5 out of our last 6 quarters have broken 10,000oz, so we really are in regime, established at 40,000oz. Very steady – which is not something you usually see with a small producer. It is very consistent. The grades are very solid. Production and throughputs are going well at the mines. We still remain a plant-constrained operation; which I will come onto in a moment. We are doing something about that, but it was still very, very pleasing. We expect this year to be more of the same with the good news that we have our ore-sorter, which is being commissioned as I speak. I am actually going out very quickly next week, to site to see this machine working. We are commissioning it right now. We have got the manufacturer at site. We are calibrating it.

Now, the effect of this ore-sorter is that, the most diluted ore that we have got, which is generally the Palito development ore, and some of the lower-grade Stope ore, we can pass this material through this ore sorter, which essentially removes waste. Either by optical; by colour, or by density. Now, we are a plant-constrained operation. Our restriction is the milling section which is around 550tpd. If the grade is sitting normally at about 7g/t or 8g/t, that means that at the end of the day, the maximum output is around 40,000oz.

The ore sorter is going to sort of screen out some of that waste rock which is currently entering the process plant and will actually liberate some space so we can actually add more higher-grade ore and get that plant processing the same volume but of a slightly higher-grade. So if the grade can go up, from say 8g/t to 10g/t, we can squeeze that plant to get something like 45,000oz to 46,000oz out of it this year.

That, obviously, might not sound a lot but it is 12.5% to 15% more. It goes straight to the bottom-line – literally. The additional mining cost is there, but the additional processing cost is not. So it makes a huge amount of sense. So that is going to be a great plus in the actual operation.

At Sao Chico, which is our satellite ore body, we feel that that is probably the place where the extra ore production, mine production, will come from, to take up the slack that I have just talked about; add these extra ounces of higher-grade ore. And we are drilling there at the moment and have been drilling for around 2-months now and that will continue for the next 3 or 4-months. We are doing step-out drilling there. It is going very well. We are just literally drilling extensions to the current mine limits. If you can imagine an ore body – it is open to the East, it is open to the West, and open at depth, we are doing underground drilling with a contractor. Doing deep underground diamond drilling, to test the ore body at depth. We will be doing the same on strike at the surface with the contractor as well.  So that aggressive drill program is going to go on for the rest of…until Q2/20, with a view of hopefully drilling a new Resource update at Chico at the end of Q2/Q3. But most importantly, it is going to actually allow us to run our mine plan a bit longer. That’s the key there.

We also have at Sao Chico, outside the mine limits, but in our exploration licensed areas, some really exciting geophysics anomalies which we actually discovered back in 2018. We have finally got a drill rig in those as well so we are actually drilling those at the moment, we are only into our second hole. The results of which will be coming out in the next 2-months. So we are going to see a steady stream of drill results, coming particularly from Sao Chico, the mine itself, the step-out drilling, and drilling anomalies during the first half of this year.

So all of this is being funded out of our cash flow. We ended the year with USD$40m cash in the bank. We are going to pay USD$6.5m off to Sprott at the end of next month, and the rest of the money will be used, along with contributing cashflows we continue that exploration program. And finally, as obviously, and the real reason we are doing the convertible loan, is the work as well at Coringa.   

We have the mining license. Coringa, our new asset which we are going to bring on stream in the next 18-months. We are making great progress on the permitting.  We are very close to getting the first license, the most difficult license to get which is called the Preliminary License. That is conditional upon a public hearing which we are going to have. The date has now been set; it’s on 6th February. That’s when all of the stakeholders go to a public meeting which is in the region. It is important that it is in the region because it is in the town where Serabi is already one of the biggest employers and therefore, we are a big fish in a small pond. We have great local support. One really important note is that on December 6th, we actually got a sign-off from FUNAI – the Federal Agency for indigenous communities which these days, one can imagine in the Amazon, that is a very important group of people, which you do really need their support. They actually signed off with full support for the project. There will be no negative impact for them, in fact, positives, so that was a tremendous piece of news for us.  Which means that we will go into that public hearing well placed, albeit the public hearing will go well and we will get the preliminary license on the back of that.

That is the hardest license and where you are going to get stopped. You are going to get stumbling blocks but we feel pretty confident. We have made the project pretty water-tight. We have got no tailings there anymore. All of the environmental impact studies etc in our plan will be to not use tailings and dry-stack tailings, again, it is as good as it can be so we feel very confident on the back of that meeting on February 6th, we will have positive news.

Just to finish on that point, we already do have the license to start the underground mine. We are going to get that underway as soon as possible. It is important to demonstrate that we are a company that is really committed to the project in the region. Getting it started, putting jobs in the local community at the earliest stage and getting that all-important geological information for lenders and equity down the line. However, we finally fund the project, at the back end of 2021, we want to advance the project and get more confidence on the asset itself.

We want to know our AISC. We have actually managed about USD$1,050 for the year in 2019 with our production, and Coringa is going to bring in an additional 35,000oz to 40,000oz. Similar cost, but whilst there won’t be direct operational synergy, as they is 200kms apart, there will obviously be maintenance synergies, management synergies, some shared facilities like assay facilities and we are trying to locate some of those facilities between Palito and Sau Chico and in a city called Nova Polesa, which basically sits equidistant between the two assets. It is a town of about 40,000 people. There are a lot of positives there and that, I think those extra ounces will come in low-$900s so overall, we will be an 80,000oz producer with around an AISC of USD$950 as opposed to USD$1,050 today. So, with today’s Gold prices and today’s exchange rates; that’s a pretty nice place to be for a company of our size.

Matthew Gordon: Last year your share price trebled. You finished with a lot of cash in the bank. You are re-structuring. Trying to give yourself a good start to the year. What we need to see from you is delivery of all of these things; getting into production, doubling your production with the addition of Coringa, so it is a case of delivering and doing what you say this year, isn’t it, for you?

Mike Hodgson: It is, but it is not something we haven’t done before; at the end of the day, it is repetition of Palito so we are not leaving our comfort zone, we are just doing the same again.

Matthew Gordon: Step and repeat: cookie cutter approach. Mike, thanks for that update. We will stay in touch and do let us know how you get on with that Preliminary Licence. It sounds like a big step for you.


If you see something in this article that you agree with, or even disagree with, please let us know in the comments below.

Any advice contained in this website is general advice only and has been prepared without considering your objectives, financial situations or needs. You should not rely on any advice and / or information contained in this website or via any digital Crux Investor communications. Before making any investment decision we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice.

Serabi Gold - Palito

Serabi Gold (LSE: SRB, TSX: SBI) – Steady Growth for Shareholders. At Last. (Transcript)

Having flatlined for 4 years, Serabi Gold are looking to double their production and get to 80,000oz by getting their recent acquisition to market. High grade selective mining. It’s an old story which is looking to getting going again and like most junior Gold miners for the last 4-5 years, the only thing holding them back was access to money. They have had their head down focusing on producing at 40,000oz at a steady state for the last several years. That is not an exciting level. Most small institutional funders are looking for 100,000oz per annum. So what has Serabi done to change things and make this story relevant again for investors? We get the back story and find out how they plan to sweat their current assets and more importantly how they intend to fund it.

With Gold above $1,500 they are finally making a reasonable margin, even for an underground operator. We find out how they have structured their debt and what happens next. What do you think of their plan?

Retail investors have started to get interested again. And a couple industry strategic players involved. It feels like a new story as shares have started moving in the right direction. That said what we like is that they appear to be sticking to what they know and are targeting growth from very similar assets. Existing greenfield and brownfield also look promising.

A very open and confident pitch by the CEO. They have always had a plan, and now with the cash and cash flow and they seem to know how to deliver it. We follow with great interest.

Interview Highlights:

  • Overview of The Company
  • Team Experience: Have They Got What it Takes?
  • Share Price and Shareholders
  • Company Strategy and Assets: How Are The Projects Coming Along?
  • Update on Coringa and M&A Plans
  • Market Conditions: How Will Free Cashflow Affect Their Chances?

Click here to watch the interview.


Matthew Gordon: Let’s kick off for the one-minute summary for people who haven’t heard the story before.

Mike Hodgson: 40,000 ounces, high-grade gold production in Northern Brazil. Para state. It’s a big artisanal gold field. We are the first operator in that part of the world. We’ve got great local relationships. We’ve actually put a mine into production. It’s taken a while. The company did it many years ago. The mine actually closed. We actually started it up as brownfield site we’re mining high-grade gold, 8g/t. Which really, I think sets us apart from the rest. People have got so used to 1g/t, 2g/t. We are 8g/t. We are underground high-grade, selective mining. And we’ve acquired about 18 months ago the Coringa asset, which is essentially a carbon copy of our current Polito operation. We’re going to put Coringa to production, make it 80,000 ounces. We’re growing organically, but certainly in a very controlled way.

Matthew Gordon: I’m interested in this story, because you guys have been in South America for a while. I’d love to understand a little bit about the team’s experience in mining in South America. What’s everyone done?

Mike Hodgson: Brazil is a country that probably is very dominated by large enormous surface deposits. I won’t pretend to say it’s been easy. We’ve actually had to address the fact that there aren’t very many small underground mines in Brazil. Therefore, there’s a people skill shortage. I suppose we’ve cheated a little bit. We actually are next door to Peru and Bolivia and we’ve got a very key people that come from there. I was the COO of Ovando Minerals in Bolivia before this job. I’ve spent much of my career working in the Cornish Tin Mines. So I’m very specialized in small underground mines and I worked for TVX before on a small underground mine. I can’t escape it, but clearly, I’m probably moderately successful at it. So we built a team, which involved key management in the mine, which came from Bolivia. And we brought over a Peruvian contractor to help us with the selective mining. Our ore body at Polito and the ore body that will be developed and put into production at Coringa, are high-grade subvertical narrow veins. Quality ounces is what it’s all about. Controlling dilution is what it’s all about.

Matthew Gordon: Apart from yourself, who on the team experience has that level of experience?

Mike Hodgson: Well, on the board itself is a gentleman called Eduardo Rosselot, an older colleague of mine. A mining engineer, a Chilanian guy. He’s been very important in terms of actually helping us with our funding. And the rest of the team in Brazil, we’ve got key Bolivian mine management. The Mine Superintendent is Bolivian and all the technical team are Bolivian. The key to our success is really this team of mining expertise and we have actually boots on the ground. That works very well. The Peruvian contractor we’ve now actually nationalized. They are now all Brazilian paid and on the Brazilian payroll. It’s a very important point because, there’s no real problem in terms of these people working in Brazil language wise, which certainly was something which concerned us at the very beginning. But just going back a step, probably people may or may not know that Serabi did put Polito in production 2003. It started probably the correct way. But back in the 2000s in London, where company originally listed, there was, let’s say a lot of people in the stock, who perhaps shouldn’t have been in the stock. They did really understand with junior mining. And I think the company did two things. 1. It chase scale to try to meet shareholder expectation. 2. It also changed the mining method because it was very difficult to find the right people for the job. So when we actually restarted this mine back in 2012/13, we got the right team in and the formula for success has been the mining. My saying always is ‘grade pays, toness cost’.

Matthew Gordon: You raise interesting point. There have been, and possibly still are, some people have been in this a long time, long suffering. The share price has been flat for a couple of years, but it’s recently picked up again. You must be quite pleased?

Mike Hodgson: We’re delighted. A little bit of brief history on that. It comes back to some of the people that I’ve been around with, like Eduardo Rousselot one of our Chilean directors. He was really instrumental back in 2012 when we want to reopen this mine. The markets were terrible. There was no money out there for exploration. There was no money for resource growth. There was only money for cash flow. And it was hard to find. Eduardo introduced us to the Fratelli Group, one of our biggest shareholders. These guys put money in at risk where nobody else would. And they backed us.

Matthew Gordon: And they’re still there?

Mike Hodgson: They’re still there. A big shareholder. They basically went through 50% because they did want trading freedom. But frankly, there was no one else coming in any way. So that’s where they were. We reopened the mine very successfully, got up to 40,000 ounces pretty quickly, were we’ve now been for about 3 years. They underwrote the entire financing, took all the risk. The problem with that was our stock was incredibly tightly held. We had no retail.

Matthew Gordon: Not no retail. Not enough retail.

Mike Hodgson: Very little retail. There’s no liquidity. Everything was great about our company except the capital structure in a way. And we thought, well, we’ll fix that.

Matthew Gordon: What have you done about that, because I note Greenstone are now in there.

Mike Hodgson: There were ticking along quite nicely, doing 40,000 ounces. Operationally terrific. Corporately still with some problems. But back in 2017, we actually acquired the Coringa asset. Now the Coringa asset was from a company called Anfield, which has now been rolled into Equinox, one of Ross Beaty’s companies. Before that, it was actually in the hands of a company called Magellan. And we’ve been trying to buy this asset for a long time, because it’s a carbon copy of Polito. We’ve been mining Palito for a number of years. We know we’ve got all the relations in the region, we’ve got the methodology, the formula…

Matthew Gordon: Before we get into the project, because I do want to come on and cover that. I just want to stay with the shareholder component and what the thinking is.

Mike Hodgson: The buying of Coringa actually was a catalyst to do another capital raise. We bought Coringa for $22M and we funded $5M out of cash flow, but then we obviously got to find another $5M and then the final payment. $22M in total. We did a capital raise in March 2018. And that point Greenstone came on board. And River & Mercantile in London.

Matthew Gordon: Just explain to people don’t know Greenstone, because they are pretty well known in the industry…

Mike Hodgson: Greenstone are a private equity fund, London based, they’re invested in probably 10 or so stories. Pretty much a multi-commodity.

Matthew Gordon: A very technical team.

Mike Hodgson: They whey work with us very well. They obviously liked Clive and myself for a long time. They’ve been trying to get into Serabi for a long time. And they’ve been looking for the opportunity and acquiring Coringa was the opportunity for them to come in.

Matthew Gordon: They know what they like. And they are very selective. It’s a very strong team.

Mike Hodgson: They came in around that financing in April 2008. A group called City Financial came in. And also we had a Swiss family office that was still actually in the story. Now this year, obviously, we know the City Financial ran into some problems. And the Swiss Family Office also wanted to liquidate their position, which at the time wasn’t welcome news. So, 6% of our stock was just basically dumped on the market in the Spring of this year. And our price went £0.40 to £0.23. And we thought that was a bit of a nightmare. Turned out to be an absolute blessing in disguise, because that stock just got picked up by retail guys. So, for once, and you’ve seen our graph of our liquidity, it’s amazing. We’ve just flatlined for about 4 years, doing all the right things, but not getting any love. No appreciation. And then all of sudden, retail guys get a hold of it. We’ve gone from like 9% retail in London to probably 16%-17%. And it’s happy days.

Matthew Gordon: It helps. It is really important for new people coming in to look at the corporate structure of a business before they invest. We’ve talked in the past about the paralysis that can come with too much institutional investors. Either one individual or multiple institutions who sit and hold, and don’t trade.

Mike Hodgson: With Greenstone, in that financing in 2018 didn’t really do a lot for liquidity. I liked this expression, ‘it gave us an amount of democracy at least’.

Matthew Gordon: What does that mean?

Mike Hodgson: These days, I don’t know. At least we had two big shareholders on the Board now. So there was a natural balance now. We got three shareholders now over 10%. And two of them sit on the Board. So there was a bit more democracy there. Fratelli came down from 52% to 32%. So that was good. That raise didn’t bring in liquidity really. But obviously, the selling of this stock in the summer helped.

Matthew Gordon: So you now recognise the importance of retail, family office and HNWIs?

Mike Hodgson: We have tried so hard to get retail into this company. It’s just been institutions coming in. We’ve only done two raises.

Matthew Gordon: So now you got a better retail in there. I want to spend some time with you and understand what’s going on in terms of the business plan, the strategy, how you’re going to deliver it, where you’re going and who’s going to actually deliver that? So describe if you can, what is the plan? We know where you’ve come from, you’ve done a great job describing that. So today you’ve got a couple of assets. So you got to deliver those.

Mike Hodgson: Technically, on their current operation, Polito. Basically is one plant, which is plant-constrained, which is actually pretty unusual these days. Because most companies of mine-constrained. Now, the good thing about being plant-constrained is it brings discipline. You’re always treating it with the highest-grade possible.

Matthew Gordon: Just be clear to people what you mean by that.

Mike Hodgson: Well, grade is king. We’ve now had a head grade around 8g/t for ever. So that’s what we work with. And being plant-constrained means we’re not just throwing tonnes at the plant. We’re actually throwing quality ounces at the plant. That’s the important thing. Palito is in a very steady state of production. Two ore bodies feeding a central plant. 500t per day between 7-8g/t. That’s what we do. And we’re kind of limited at the moment. We don’t really want to expand the plant, because our ore bodies, as you can see from the presentation, they are high-grade, narrow veins. So all our business is to actually mine these veins as well as we possibly can, minimizing dilution as much as we can, to get quality out of the mine. And then basically through the plant. Inevitably even doing this where the best possible way we can, we still get some dilution into the into the system. Over the last 18 months we’ve actually been testing ‘ore sorting’. I know this is a big buzzword these days. I’ve just come back from Beaver Creek and it is all the rage. It won’t solve all our problems, but certainly help a lot.

Matthew Gordon: What is that going to help with?

Mike Hodgson: There’s ores and waste. The gold is inside the sulfides and outside that is just pure waste granite. The ore sorter is actually a waste remover. It sorts on either color, or on density. The difference is really, really good. The intention is to pass our lower-grade material through the ore sorter. And it’ll screen out waste. First of all, it’ll take waste out of the system. That will save us about $1M a year. But more importantly, it actually liberates about 20% of space in the plant. We can actually add more high-grade ore and make a little plant go from 40,000 ounces per year to 50,000.

Matthew Gordon: And very low cost presumably.

Virtually no cost. That almost goes straight to the bottom line. From today we’re 40,000-ounce operation probably making about $4M-$5M a year.  It’s positive cash flow. We put in the ore sorter.

Matthew Gordon: It doesn’t cost a lot. Comes out of cash flow.

Mike Hodgson: $1M

Matthew Gordon: So no dilution. And improve efficiency and productivity.

Mike Hodgson: That’s the first thing that we’re doing at Palito. Down in Coringa, our other new asset, which we are developing. That is actually build ready. When we bought that asset, Anfield did a terrific amount of work there. They spent a lot of money. And they built camp. They bought a process plant. They bought all the toys. A lot of the mining equipment. They did a lot of work. They did the studies, which is great. People ask me all time, why did Equinox sell the asset. Scale! Too small for them.  At the time they probably thought the asset was going to be a lot bigger and was going to be their platform to build a gold mining company in Brazil. And they were looking for something a lot bigger than Coringa could be. Although it’s a very tiny deposit, it doesn’t really work for anybody else except us. We’re in Tapajos. We’re the only hard rock producer. Coringa’s 200km down the road from Palito. There’s little point two companies having to 50,000 ounce mines, in the same region where there’s very little else. They belong in the same stable. So the marriage occurred. We bought the asset. We’re now working our way through the permitting process. We’ve just submitted our new Environmental Impact Assessment (EIA) or statement yesterday. We should get a public hearing in around well, after that’s been protocoled and approved, which hopefully will take about less than a month. We will get a public hearing when we actually go to the local community, and hopefully get approval. And I think because we have been in the region for 10 years with the same authorities. We’re not exactly the new kids on the block.

Matthew Gordon: So just on that. We’re starting to build a picture of the types of facilities, mines, operations that you are comfortable with. And they are similar in profile.

Mike Hodgson: Very similar. I don’t think you can actually have a deposit more similar.

Matthew Gordon: Sorry I did mean to ask, in terms of the ore sorter, what’s the timing of that and more important what is the timing of when the benefits of that start flowing through?

Mike Hodgson: The sorter has taken a while to get. But it’s now at site. It’s being all the infrastructure around. It’s now being fabricated and installed. We will switch it on probably in November 2019. We hope to be doing its job in January 2020.

Matthew Gordon: So imminently it will start to contribute towards the bottom line?

Mike Hodgson: We’re going on guidance. We’re about to close Q3/19. It’s been just the same as Q1/19 and Q2/19. Another 10,000-ounce quarter. So we’re bang on guidance to do our 40,000 ounces for the year. And I think next year we’ll hopefully be making a hole in 50,000 ounces because of the ore sorter.

Matthew Gordon: So that that’s going to hit the bottom line from Q1/20?

Mike Hodgson: Yes, it will. And we’re sitting here today, 40,000 ounces making about $4M – $5M. That’s going to go up very handsomely with the ore sorter. 10,000 ounces of very little incremental cost. With just a little bit more process cost.

Matthew Gordon: Something to look forward to end of Q1/20. So now we’re going to talk about Coringa, because it meets the profile, it’s a similar looking system. More of the same. You know what you’re about. So tell us about what’s happening at Coringa.

Mike Hodgson: Repeat the formula. Coringa, obviously, our big news recently was the publication of our PEA, which was great. It really just demonstrated what we absolutely expected.

Matthew Gordon: You made a few tweaks to it?

Mike Hodgson: Yes, it’s going to be a 40,000-ounce deposit. The process plant is there. A little different to Polito. This process plant was bought from a mine in Para. It’s actually much bigger, so there’s no capacity issue with this plant. It’s a very similar deposit to Polito. We are just working our way through the permitting process at the moment. One thing that we do have already is we have the mining license, which is something Equinox never got to. We can start the mine tomorrow, subject to funding. We are going to start going underground. Why is this important? It’s important because we want to first of all, we want to establish the continuity, because Coringa degree is a greenfield site. It’s drill holes. 1. We actually want to establish that continuity. 2. The indications are in a lot of the drill holes that actually the widths at Coringa are probably a little better than Polito. And I think there’s an opportunity to maybe semi-mechanise this deposit, which would be great. Great for cost per ounce. And 3. we want to take a nice big bulk sample because Copringa is 200km away from Polito. We will truck that bulk sample up to our ore sorter at Polito. And we will let you run it through and see how it performs. I would suspect that the ore sorting is going to work very well and therefore, although we don’t need the ore sorter from a capacity issue at Coringa. Why process granite? Why not put an ore sorter in there? Again, it’s all about grade, grade, grade. Get that grade up as high as we can and the get the ounces from processing as little material as possible.

Matthew Gordon: What was the timing on all of this?

Mike Hodgson: We want to actually start the underground development in before the end of the year. In Q1/20. Now, we can start the mine. What we cannot state at Coringa yet is the process plant and the construction. We’ve got to work our way through the process. Now, that’s why the EIA has gone in. We hopefully will get what’s called the Preliminary Licence by the end of the year. That is basically the Environmental Impact Assessment (EIA) followed by the positive public hearing by the end of the year. If all that happens, that will be great. Then we can actually launch into what’s called the construction licence. We then bring in an engineering company to come and do the basic engineering, which is basically the design work for the erection of the process plant. That will probably take around 6 months. So we would like to think we’ve got the construction licence by early Q3/20 next year. Which means that we can start building.

Matthew Gordon: Construction towards the end of next year is what you are aiming for?

Mike Hodgson: I would like to think we’ll start August time we will be starting to build. And having just done it at Polito.

Matthew Gordon: You are talking to the same departments and government bodies. You have established relationships. The track record. You expect those sorts of timings based on what you previously experienced.

Mike Hodgson: Exactly. These are the guys that gave all of this for Polito five years ago. We’re just doing it again with Coringa. So they’re very comfortable with us as being the only game in town really. But the good thing if we do start the mine first to actually assess and maybe improve the mining, optimize the mine plan by this underground development. And maybe optimize the flow sheet by adding in an ore sorter. We’re just going to improve those PEA numbers even more. And the good thing about that is I think people will note that in the PEA, we’re talking about a CapEx number of $25M, there’s 20% contingency as well. And let’s face it, that study was completely based on Polito. It’s the one thing we have 100% confidence in is costs.

Matthew Gordon: True. I’d say you more than most. Because most PEAs have a variance of +/-30%. You’ve based it on what you’ve done previously.

Mike Hodgson: I thought that the consultants were being rather penal. 20% contingency on costs on a mine that’s just up the road is identical to the one we’re going to do. So we’re pretty confident that the $25M, we can chip into that. And there’s also the All In Sustaining Cost (AISC) is coming in at about $850 and this 20% contingency on that. So, we’re looking forward to Coringa really bringing our costs down.

Matthew Gordon: Now, that’s because most of your costs are staying at Polito.

Mike Hodgson: So that’s why it’s loaded.

Matthew Gordon: The blended number?

Mike Hodgson: $900-$950.

Matthew Gordon: A nice number. Is there much you can do about that? I know you’ve got various fixed costs which you can’t affect.

Mike Hodgson: The gains are basically if we can actually get some mechanised mining in there. The gains are going to be will an ore sorter work at Coringa too? These are the real nice little gains.

Matthew Gordon: Is there a number you’re chasing?

Mike Hodgson: I think we’re pretty tough to do underground mining much less than much less than $900, maybe high $800s. That’s gonna throw off a nice bit because it wasn’t so quick.

Matthew Gordon: We’ve got three locations. What’s that combined number look like? You’re heading up towards original size production.

Mike Hodgson: So the two are the two mines, Polito and Coringa. They’ll both be doing about 40,000 ounces each now as well as that. The other thing that we’ve been doing is basically on mine site exploration in and around the Polito and Sao Chico ore bodies. One of the use of proceeds of the capital raise that we did in 2018, when Greenstone came on board, was we flew an airborne geophysical survey, over the whole tenement. 40,000 hectares of that wasn’t cheap, but the results it threw off were great. The thing lit up like a Christmas tree. Again, what we’re looking for is, are these sulphides which show up with airborne geophysics very well. And we have artisanal mines all in our property. They’re not a problem. They only mine that top 10m They are their exploration tools. They’re great. So a combination of those and anomalies etc are really important. We use the airborne geophysics as a high-level filter. And then wherever we have anomalies, we go on the ground to do follow up ground geophysics and geochemistry, and just basically this risk reduction before we actually drill. And we’ve actually got some fabulous anomalies, both in geochemistry and ground geophysics in and around Sao Chico, which is our satellite ore body. And where we are now drilling at Sao Chico in the immediate mine site area looking for strike extensions, which is going very well. And then we’re going to move on to these discovery drill programs on these anomalies, which are only 3-4km away from the actual Sao Chico deposit itself. We can turn exploration success into production growth very quickly, particularly at Sao Chico. So the third part of our our strategy is to continue Polito as it is, add the ore sorter. Develop Coringa, advance the permitting and actually get underground at the same time. Finally, on the organic growth, its mine site exploration and maybe a little bit more in and around our current producing assets Polito and Sao Chico. So all in all, base case 80,000 ounces, we think we can with a bit of exploration success in and around our backyard’s, we can get to 100,000 ounces in the next 2-3 years.

Matthew Gordon: Well that’s the magic number.

Mike Hodgson: It is but it frustrates me a little bit because, I think the most important thing is cash flow. Free cash flow. Everyone’s obsessed with 100,000 ounces.

Matthew Gordon: It’s more an indicator of scale and opportunity. I think the picture you’ve painted today is an interesting one, in the sense that, you know the type of structures that you’re after and the types of projects that you are comfortable with and have the knowledge of developing. You’ve got to get Coringa going. But it also says potentially future M&A is we know what we’re looking for. We’re very, very specific. I know you’ve got the organic stuff. Is there much M&A thinking going on?

Mike Hodgson: I just think we recognize that we’re not ready for that yet. I think I think at 40,000 hours it’s hard. You have really got the currency, and we’ve got a project to build already. So that’s where our focus lies. I think once we’ve got Coringa permitted and we’ve got the funding in place, and we’re building it, we’re really on our way to 80,000 ounces. I think at that point we’ve probably got the firepower to have some serious conversations. And, you alluded to our costs. At the end of the day, it’s underground mining. It’s not the cheapest mining on the planet. Open pit brings that. So, I would like to think our next acquisition would be if we do one, or merger it’s a blend of underground high-grade with some scale to get our costs down.

Matthew Gordon: is there much of that in Brazil.

Mike Hodgson: Yes, there’s more of that than there is the underground. I think we’re the best small underground miner in Brazil.

Matthew Gordon: I’m a buyer of that.

Mike Hodgson: We won’t do a deal for the sake of doing the deal.

Matthew Gordon: That’s what I mean. There’s dilution in that. It’s a new type of mining for you. And there are many carcasses on the side of the road in Brazil. Step forward with caution.

Mike Hodgson: Our ex-chairman always says to me, sometimes the best deals you do are the ones you don’t do.

Matthew Gordon: Keep your money in your back pocket. But I like sweating your own assets with this organic growth. If you’re in an area that’s prolific and well-known, why not.

Mike Hodgson: The area has seen 30Moz of artisanal gold mined. There’s been no systematic exploration in this part of Brazil, which scares a lot of people off. But for us, it’s a blank canvas. And I really do think the ore sorting, and our approach is going to be a bit of a paradigm shift to this part of the world. We do not market ourselves as a Brazilian mining company. We market ourselves as Para mining company. Because Brazil is a collection of 26 states. State government rules over Federal government big time. You’re not going to solve any problems in Brasilia. It’s all in Bélem in the State capital. And again, we’re in Polito. We’re going to try to develop Coringa using that relationship. This is a great place to be.

Matthew Gordon: So let’s talk about the market. Obviously you are producer, so you’re seeing the benefits of the gold price, which is great. Explorers and developers are not seeing it. Most of them aren’t seeing it. You are. Which is great news for the bottom line. More free cash flow. But you’ve got things to spend it on?

Mike Hodgson: We always have. We’re saving as much cash at the moment. We have a final payment to actually fully acquire Coringa at the end of the year. We’ve just got the cash. We’ve basically got that in the bank. Which is good. So we’re just trying to build as much as cash as we possibly can through the end of the year. So make sure Coringa is 100% ours. Which it will be and then we derive forward.

Matthew Gordon: You’ve got the cash to acquire the asset. You’ve got incremental free cash flow in with gold as it is today, long may that continue. Is that enough to allow to do the things that you want to do. Certainly around growth organic, for instance?

Mike Hodgson: It’ll be tight. It all depends on where the gold price is going to be. I look at Coringa and we’ve got we’ve actually got we’ve had it we’ve got a great relationship with Sprott Asset Lending. The only equity raises we’ve done the last 5, 6 years, have been the equity raise to put Polito back in production. And obviously the what we did last year to get Coringa. In the meantime, we’ve just taken on some debt.

Matthew Gordon: So that’s Sprott?

Mike Hodgson: Sprott Asset Lending out of Toronto. We basically borrowed $8M. We paid $8M back out of cash flow. They thought we were legend Most people do an equity raise to settle the debt. We earnt a huge amount of trust with these guys and they are absolutely ready and waiting when we’re ready permitted with Coringa.

Matthew Gordon: So again, I just say it sounds like you know what you’re doing with it goes to your cash position with the acquisition and the debt and so forth. So maybe that’s one we can pick up on the next update when you have delivered a few of these things. Because I guess you’ll be in a position to know where you’re at, and what you want to do. But, just just on this market condition at the moment. Have you got any views? Is it going to sustain? Do you have an opinion?

Mike Hodgson: Well, we had a board meeting today. Everyone around the table had a different view.

Matthew Gordon: Well, who knows?

Mike Hodgson: Do you?

Matthew Gordon: Well, no, absolutely. Absolutely not. But I’ve heard some really quite strange $3,000 type numbers being put out there. Obviously that sells.

Mike Hodgson: I just went to Beavercreek to the Metals Summit. We are all of the gold bulls? 85% of our costs are in Brazilian Real. Once we’ve got the double whammy. We’ve got we’ve got the gold price growing and 6,300 Real ounce. I mean a year and a half ago it was just over 3,000. There always used to be a natural hedge between the Brazilian Real. When gold strengthened, the Real was was weakening or vice versa. We never really got the double lift.

Matthew Gordon: A lot of people are getting that.

Mike Hodgson: Record levels in Australia. Record levels in Canada. All the resource-based economies are actually getting this.

Matthew Gordon: But it’s question of how long it lasts?

Mike Hodgson: At the end of the day, you look at the macro economics. China and the US and all that, it probably bodes quite well for gold with all this uncertainty, I think. But, people with much better pay grades than I, have got it pathetically wrong. Well that’s probably why, the time is good. Our share has gone to three times, and the market’s there at the moment. I hope he’s gonna be there when we finally need it.

Matthew Gordon: It’s been a good chat, good introduction, because we haven’t spoken before. Our listeners and subscribers have not heard the story before. I know you’ve been around for a while. I wanted to speak to you. I like the robust, relentless, can do attitude of the business. And its share price has been what it’s done for the last few years, but it’s on the move. It’s doing all the right things it seems to me. I want to see that you continue to deliver what you say you’re going to. Do you want to leave us with maybe a few reasons why new investors should be looking at Serabi now?

Mike Hodgson: We’ve now got a record. There’s liquidity. You can get stock now, which is great. For a long time, you couldn’t. So that’s a plus. And there’s a lot more steam in this price. We’ve got a real great economic tailwind at the moment. We’re going to be meet guidance. And next year it’s going to get a little bit better.


Company website: https://www.serabigold.com/

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