Rick, Rick Van Nuenheiser, Contango Ore. How are you?
I’m doing good. Good. Congratulations. You just poured gold. We, uh, we just poured gold. Actually. I wasn’t here on Monday because I was holding the bar of gold in my hands and, uh, from our Moncho project, which we joint ventured with Ken Ross. Yeah. We found a million ounce deposit.
We joined venture with Ken Ross because they have an existing mill. It has had excess capacity. And so, uh. We took a shortcut to production. Um, as you know, in today’s world, it probably would take 5 to 10 years to permit a design. Easy. Yeah. And they say on average it takes 15 plus to, you know, from discovery to production.
Um, and so we kind of, you know We figured out a shortcut to the Lausanne curve and, uh, and, and, and it’s worked. And, um, so it’s actually a business model that we’re, we’re going to work, continue to work on and continue to try to perfect, but, uh, looking at other projects that kind of fit that same mold, high grade, near infrastructure and relatively simple from a permitting standpoint.
Nothing’s easy, right? Nothing is simple, simple, but, uh, On a relative basis, if you’re above the water table, i. e. a mine on top of a hill is a good, good starting place. That’s what Moncho is. So, that’s our, that’s what our, our business plan is, is to execute on that.
Okay, so work me through the business model, then how is this different than everybody else, and how did you get producing so quick?
So, yeah, basically the model is focused on quality, and don’t get all worked up about quality. Trying to find a 5, 10, 20 million ounce gold deposit, uh, which is most of what the junior speculative market is selling to investors. And we’re going to find, you know, get leverage to gold and have leverage to lots of gold and, you know, they talk about half, half a gram being, you know, high grade or gram being high grade and it’s like, that’s not high grade.
And yeah, that gives you leverage to gold, but you know, you might just be leveraged to a bag of nothing. So we’re focused on things that we can get into production quickly. Um, relatively quickly. Uh, which means it’s got to be relatively simple, but it’s got to be near, near infrastructure. It has to have a grade sufficient to be able to pay for the transport to the existing mill facility.
Um, and which ours is, uh, Muncho is 240 miles by truck, by highway. The highway’s right there. So, uh, we had to build a road connecting us to the highway, but that was, it was an 18 mile road. Um, Six percent grade. It’s got it because you have to have a, you know, truck haulable road, right? So we did all that and uh, we formed a joint venture in 2020 in september 2020 with kinross and Took us, uh about a year to complete a feasibility study on the on the on that plan Okay, i’m there and transport the orange process and that’s pretty standard.
No, that’s fairly standard You know, you can get you can get the work engineering and you know work done to uh, 12 18 high level Yeah, 12 months took us a year to permit You Um, that’s really quick because it was just a mine. It’s just a quarry operation. Okay. And as, as I said, it’s on top of a hill, so you don’t have a lot of water to worry about.
Mm-Hmm. ,
you still have to, you know, there’s still stuff to worry about and so things to have to plan around, but it’s, it’s a lot easier permitting a mine at the top of the hill than it is at the bottom of the river valley.
Yeah. So you didn’t, water is
always the sort of the worst enemy of a mine. It either got too much or not enough.
Right. Um, so from a, again, from a permitting standpoint, Montreal was relatively easy. We had a minimal impact on wetlands. Um, we were just over the five acre threshold that triggers NEPA, the National Environmental Policy Act review. Um, but we, you know, we did go through a NEPA process. Uh, for the mine, took a little less than a year from start to finish, official start to finish.
That is so fast. Which is quick in today’s world. And it’s quick because we didn’t try to permit a tailings facility in the middle of a power plant. That would have taken five years. At least.
Yeah. So you said you want to take this model to what? To where? Do you have other properties then, or?
Yes, we have two other, um, high, um, properties that fit that model.
Um, we have, in naming them, we have a high quality resource, uh, Lucky Shot has a, we have a, uh, a 14, 15 gram, uh, high grade underground resource identified. It’s small right now, it’s only 100, 000 ounces, but we’ve got all the underground developed. We’re fully permitted for mining.
Okay.
So, uh, we’ve, we’re underground now and we’ve put the drifts in to be able to do the detailed drawing to, uh, to define a larger resource.
Our objective is to outline about three, four hundred thousand ounces, um, and put a mine plan around that, you know, in that 12 to 15 gram kind of average grade. Um, and again, we’re all permitted. So if we put rocks in a box and haul them up to Fort Knox, you know, we’re in business. Um, so again, that was fully permitted.
So yeah, we have the railroad there, which is, uh, which reduces costs. Obviously rail is a lot cheaper than trucking. It’s about a third the cost of trucking. Um, and then, um, uh, again, it’s, you know, it’s relatively low capital to get into production and it’s relatively, uh, low, uh, low environmental risk is there is, you know, we’re fully permitted already.
So. No, no project is ever without any risk, but, um, you know, we look at ways to, uh, the quality of the deposit and the, and the proximity to, uh, infrastructure. The other one, the next one up would be Johnson Track, which we just actually closed on the transaction today. We’ve officially Congratulations.
Acquired, uh, high gold and, um, uh, 100 percent acquisition. So it’s now a subsidiary of, of Contango. Um, So it’s also in Alaska. It’s, uh, we always do this in Alaska, right? Right. So Anchorage is, you know, down here. We’re just kind of opposite when you’re in Anchorage, downtown looking across the inlet. Yep. You just look a little further south and that’s where the Johnson Fact Project is.
Okay. We’re about 10 miles from the coast. Okay. So there’s our infrastructure. Right. The marine highway. You can just barge it. So, um, we’re on private land owned by Siri, and that’s another important criteria. We work on private land, uh, either private patented claims, uh, or, uh, land that’s owned by an Alaskan native corporation or tribe, or state land.
We do not work on federal land. It’s just too big of a pain in the butt. Right. Okay, so let’s talk about that.
Um, native corporations, which is typically, they’re very friendly, being from Alaska, myself, very friendly to natural resource companies such as yourself that want to develop the land. Or you work only on state land or private land, which is also very friendly to people like yourself that are developing the land.
That helps
with the whole permitting aspect. Yeah,
absolutely. Okay, so what’s the grand plan is just to keep on taking this model in Alaska, if you would, gobbling it up?
There’s
other opportunities
in Alaska, but we don’t see this as limited to Alaska. Sure. Certainly, we know B. C. and the Yukon really well.
Um, I think, you know, Yukon is going to be on hold for a little bit until things get sorted out with Victoria. But, uh, um, but in BC, there’s lots of opportunities. We’ve worked for BC. I think, I think the model applies. It’s kind of the hub and spoke model. Anywhere there’s a mill. If there are opportunities around those mills for, uh, exploration properties that have to meet the criteria.
You know, so things that are above the water table are helpful. I Um, things that are really close to infrastructure is, is helpful. And obviously, grade can pay for, you know, they’re not as close to infrastructure. If you have a little better grade, you can pay to build that infrastructure like we did at Moncho.
We, we built an 18 mile highway, road, road, roadway to the highway. So, um, yeah, I mean, we see this, we see this as a, uh, a model we can apply elsewhere. We’re gonna, you know, we’re gonna kind of stick to our backyard, but I’d say, you know, Alaska, Yukon, BC, that’s our backyard.
Northwest area.
Yeah. Yeah. And there’s, you know, there’s, there’s plenty of mills around there that are, uh, that have excess capacity.
So, and the other thing, I think, keep in mind, if you have a mill that’s, that’s processing five gram per ton grade from a resource that they’ve defined, if we come to them with Johnson Tract that’s got 10 gram, there’s a business transaction to be done. Right. Why would they say no? Yeah. Why would you say no?
Right, right, right. So, um, that’s. It’s just, it’s kind of a common sense model, I’m, I’m, I, I don’t think we’re the first ones to do it, but I, we’re, I think it’s just different from what everybody else is mostly selling, which is, you know, I’ve got a gold deposit, and we’re gonna make it bigger, and, you know, we’re gonna develop it.
It’s just a really tough, uh, road to be an explorer and to make that transition to a producer. It is not easy.
It’s not easy, and it takes time. It takes time. Minimally five to 10 years, I would say, and that’s minimally, if not 10 to 15 years more than likely.
You know, the people who write about this stuff are saying it’s 15 years from discovery hole to production, on average.
Yeah, yeah. And lots and lots of capital to raise, which is lots and lots of equity dilution to shareholders. And I think that’s the advantage that we have right now is, uh, that. We have 12 million shares outstanding. We’re NYC how many? 12 million. 12 million. Okay. We’re NYC American listed, so, uh, so you’re traded on
the New York Stock Exchange?
Yeah, we’re not a Canadian junior. Okay. We’re us. Interesting. We’re US based, we’re our, our home base, our head office isn’t Fairbanks, Alaska, Uhhuh. Um, you know, so we get a lot of, you know, support from, uh, from Alaskans. Yeah. For our business plan, because it’s based in Fairbanks.
Yeah. No kidding. Yeah. Well, that was another thing.
It’s like you’re trading on the New York Stock Exchange, so you have to comply with all the regulations and et cetera, et cetera, et cetera.
And there’s plenty of those. Sure. You hire the right people to make sure you fill out the paperwork correctly. Having a good CFO is a key part of that. Yeah. I think the other thing is, that’s a little different with our business model is, I liken it to more like the royalty companies.
And that’s, What’s the characteristic of a royalty company is they just don’t have a lot of people. Right. Right? And royalty companies will tell you that they don’t have operational risk. I don’t think that’s exactly honest. I think they don’t have control of the operational risk. The operator Right. Has control of the risk and there sure is a hell of a risk there.
Right. So, um, we have a say in the operations because we’re an equity owner in the, in the operations. So we have some say. We don’t have control because. It’s a manager in case I’m on show, it’s Ken Ross. Right. And we’re kind of happy with that because they know what they’re doing. Right. They’ve operated a Fort Knox mill for 30 years.
I haven’t. Yeah. So I’m happy to say, hey, you know, the 700 people that you employ Are dealing with. You manage those 700 people, we’ll pay you a fee for that. That’s the, you know, the tolling arrangement. We’ll pay you, make sure that all runs smoothly. And they’re obviously incentivized because they own 70 percent.
So. We’re kind of on the same team, right? Right. And that, so that, that’s what’s a little different with the, with the business model. I’m, I liken it more to a royalty company because we, we don’t really want to be the operator. Right. Um, I’m happy to give up. I’d like to, you know, ideally we, we didn’t start with a hundred percent of, uh, of Bonsho, we only had 60.
So, um, if, if we had started, I probably would have done more like a 50, 50. Right. Right. Um, and so I, I think, you know, our future project, my, Lucky Shot and, uh, uh, and Johnson Track. I would look more to that sort of a model. Which is what I’ve kind of done in the past with Nova Gold. You know, when I started Nova Gold, which I started in my basement, we grew it to a two billion dollar company.
Um, and we did a 50 50 partnership with, with Bayer. We found one of the biggest gold deposits in the world, which was fun and kind of a blessing in some ways, but it’s still not in production.
Right.
Why? Because it’s in the middle of nowhere and, you know, It’s, I don’t know what the capital cost, it’s probably close to 10 billion.
Yeah. And those are hard. Yeah. They’re even hard for Barrick. Yeah, right. Right. So we don’t want to do that again. I mean, I would love to find another 40 million dollar, or 40 million ounce deposit, but I’d prefer if it was next to the highway.
Yeah, right. Yeah, you and me both. Well, Rick, um, tell us where people, if they want to invest with you, give us your, uh, where you’re traded and your ticker symbol.
Sure, so the And also, to be, uh, if they want more, uh, info on your company, how do they do that?
Perfect. So, um, CTGO is the trading symbol, NYSE American, so NYSE A, uh, is the trading platform. Um, and then our website, uh, www. contango. org. Dot com. So it looks a little weird when you write it ’cause there’s two o’s next to each other and Spellcheck never likes that
Got it.
Well, I’ll put all of this in the show notes below as well as on the, uh, the show notes in Spotify and Apple. Rick, I wanna thank you so much, uh, quite the compelling story.
Pleasure and good
to
meeting that fellow, fellow Alaskan here in, uh, in Florida.
So yeah, great pleasure. Take care.
