VIDEO: Metanor Resources Inc. President Pascal Hamelin Growth Potential in New Project Sites
Metanor Resources Inc. (CVE:MTO) (OTCMKTS:MEAOF) (FRA:M3RA) President & COO Pascal Hamelin updates precious metal mining investors on their company’s new projects growth potential in the very near future. Pascal outlines Metanor’s current and prospective gold production attracting large shareholders interested in their new key project sites.
James West: Hey, welcome back to Midas Letter Live. My guest in this segment is Pascal Hamelin; he is the President and COO of Metanor Resources, trading on the Canadian Venture Exchange under the symbol MTO. Pascal, thanks for joining me.
Pascal Hamelin: Thanks for having me, James.
James West: Pascal, it’s been years, literally years, that I’ve been following Metanor’s progress, and the company has had many changes. And tell me, what is new with the company now?
Pascal Hamelin: Well, we got a lot of projects on the go right now, with Barry, Bachelor and Moroy. We got, with the exploration that’s been done in the camp, the urban Barry camp, now we attracted new shareholders, and these shareholders are pretty big and they’re very keen on, they’re very excited with the camp. So it gives us the ability to do what our plan was. So that’s a big difference.
James West: Okay, so how much gold is being produced at Metanor now?
Pascal Hamelin: We’re in the range of between, I would say around 30,000 ounces a year, but that’s just for one site, the Bachelor itself. With the addition of Moroy and Barry, there’s potential to go well above the 75,000 ounces.
James West: Okay. And so, when do you anticipate that coming onstream?
Pascal Hamelin: Well Moroy, we’re doing the bulk sample as we speak. We started in April, so that one will come onstream first. Barry, we started the decline at the end of March, so we expect to hit the gold zone in the fall, well, late summer. So 2019, we could be in that range. We’re also applying for a permit, an increase in the mill capacity. So we’re in the permitting process right now, so it’s in the environmental authority right now, so once we get that permit, we can extend the mill out to 2,400 tonnes a day. It will depend on how much, on how big Barry will be, and Moroy. But we’re going for the permit at the mill for 2,400 tonnes a day.
James West: Okay. And so, we’re looking at the 3D model on your website of the Barry project right now from May 2017. And what are we looking at, here?
Pascal Hamelin: Okay. You got two types of – there’s a contact zone along what you see in light, I would say, pink, and that’s what was mined historically with the open pit between 2008 and 2010. Now, what we’ve found is that there’s shear zone associated that you see in red, those are narrow veins, sub-particle shears, a lot higher grade. Historically, the contact zone against those pink intrusives was 2.2 grams; now these high-grade shears, we’re drilling them and it’s higher grade. It’s narrow, I would say probably between 2-3 metres, and the grade, well, that’s why we’re doing a bulk, is to assess the head grade that we’re going to shoot to the mill. But it’s going to be, my expectation is going to be probably close to 7 grams.
James West: Okay, great. Now, you were, in the past, wasn’t it Sandstorm Resources had financed the project in exchange for a streaming royalty?
Pascal Hamelin: That was for the Bachelor mine back in 2010, yes. To acquire that strain, they paid us $20 million USD back in 2011, and that was for the life of mine of the Bachelor mine. But with Moroy coming onstream and Bachelor going down at depth, the stream was paid off. We’re well over, we met all the commitments. We’re over, they made over $30 million in revenue so far, so we signed an amendment to the existing stream back in September 2017. So that stream is going to end once we deliver 12,000 ounces, and we already delivered 3,000 of those 12,000. So we’ve got 9,000 left to deliver, and then after that, the stream is converted into an NSR.
James West: Okay. So then the, is the company profitable, currently?
Pascal Hamelin: The Bachelor itself is making cash for the Bachelor. With the extension of Barry and Moroy, we’re in the expenditure phase right now; we’re investing heavily, but in order to get up to 75,000 ounces, you’re going to go through that investment phase, which we’re in right now.
James West: Okay, that’s great. So who are your biggest shareholders and supporters, now?
Pascal Hamelin: The larger shareholders, there’s four: there’s three major, and one that has less than 10 percent. But the first three that they’re all near 15 percent, we got Wexford Capital from New York; we got Eric Sprott himself; we got Kirkland Lake Gold. The three of them are 15 percent. And we got VanEck from New York as well, they’re a little bit below 10. Those are the four largest shareholders that we got.
James West: Sure. Tell me about the price sensitivity to the gold price: where is it that you find it more challenging to make money? What is your hope for the gold price going forward?
Pascal Hamelin: Well, us, it’s in Canadian. So let’s say, if I go to American, $1250, I’m pretty happy with $1250 USD. It’s good, our projects make money at that range. Of course, we’re more influenced by the exchange rate. All our costs is in Canadian dollar, so right now, at $0.78, $0.79 per Canadian dollar, I think we’re pretty good. Overall
James West: What is your all-in sustained cash cost per ounce of production?
Pascal Hamelin: All-in sustaining, we’re at about, at the current stage, cash costs, we’re at $850 US cash cost for Bachelor. If you include the investment, the sustaining, corporate and a little bit of drilling, we’re at about $1150, $1200 USD.
James West: Okay, great. What’s the life of mine, do you expect, for the new projects?
Pascal Hamelin: Well, Moroy is a mirror image of Bachelor, so we can expect maybe 10 years out of Moroy. The Barry itself, it’s going down at depth. It’s still early to advance a life of mine number, but I’d say a good five to ten years as well.
James West: Okay, great. Now, so tell me: as an investor in precious metals miners, what would you say to me to induce me to invest in your company right now?
Pascal Hamelin: There’s the grow potential, and we’re the operator of the urban Barry camp, so the mill is the key as well. There’s nothing else in the area, so that’s one aspect is, if you want to produce gold, be a gold producer not in the distant future but in the very near future, we’re the one to be in right now.
James West: Okay, well, Pascal, it’s been a very great update to have from you here. We’ll come back to you in a quarter’s time or so and see how you’re making out. Thanks very much for your participation today.
Pascal Hamelin: Thank you, James.
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