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Mirasol's Stephen Nano on Yamana JV and Prospect Generation
Aug. 09, 2015 07:55PM PSTPrecious Metals
Nano spoke about the company’s Gorbea Belt and Curahue projects, also discussing the benefits of the prospect generator model in today’s tough markets.
At the recent Sprott-Stansberry Vancouver Natural Resource Symposium, the Investing News Network had the chance to speak with Stephen Nano, president, CEO and director of Mirasol Resources (TSXV:MRZ). Mirasol is a prospect generator focused on delivering discovery success in emerging districts of the Americas.
Nano started out by discussing the early stage work going at the Chile-based Gorbea Belt projects. Mirasol’s partner there is Yamana Gold (TSX:YRI,NYSE:AUY), and the company recently completed a large geophysical survey there.
“We’d previously done a lot of mapping and trenching, identified some large, high-grade structures at surface, and indications of the right kind of system,” he said, adding, “our geophysics had shown that there was also the footprint of bigger interesting targets in the near surface. Yamana has extended that survey now, and covered approximately 25 square kilometers of the system.” Nano noted that the work is preparation for a drill program that will hopefully begin prior to Christmas.
He also discussed Mirasol’s Curahue project, which is in need of its own joint venture partner. Interestingly, Nano said that it’s generally his company that approaches joint venture partners, and not vice versa. “We really carefully select our joint venture partners. We’ll make a shortlist of companies that have the skills that we need, [and they] are often focused on the same region or the same country so that there’s a real synergy there, and invite those companies to come and have a look at our projects,” he explained.
In closing, Nano took the time to speak a little about the prospect generator model and why it’s suited to today’s difficult markets. “The joint venture model works really well in a good market and a bad market, but it’s an excellent model for now,” he said. “We’re sitting there with a good business model and cash in the bank, and a really nice share structure, so if we deliver a discovery even in a difficult market like this, it will accrete, it will improve the share price.”
INN: I’m Charlotte McLeod with the Investing News Network. Here today with me is Stephen Nano, president, CEO and director of Mirasol Resources. Thanks so much for joining me today.
SN: Thank you very much.
INN: Let’s start by going over some of Mirasol’s recent news. It sounds like there is some early stage work going on at the Gorbea Belt project through Yamana Gold, your joint venture partner. Can you explain what’s happening there for investors who might be more used to hearing about drill results?
SN: Mirasol is a prospect generator, a successful prospect generator that has been able to deliver discoveries through that cycle. What we do is we take concepts, we discover deposits and move them through to drill stage. What we have done at Gorbea is assembled a package of projects that are sitting on one of the most prospective mineral belts in Chile — and importantly, a mineral belt that in the last two months has delivered two giant discoveries, both from Barrick Gold (TSX:ABX,NYSE:ABX) and Gold Fields (JSE:GFI,NYSE:GFI). So we think that we are in the right place.
…two of [the] nine projects with the Yamana joint venture … have very large-scale outcropping gold systems of the same kind as the discoveries made by Barrick and Gold Fields. What has happened here is Yamana has recognized the potential to deliver a large-scale discovery … [and] they have done a large geophysical survey. We have previously done a lot of mapping and trenching, identified some large, high-grade structures at surface and indications of the right kind of system. Our geophysical [work] has shown that there is also the footprint of bigger, interesting targets in the near surface, [and] Yamana has extended the survey now and covered approximately 25 square kilometers of the system. We can see from the results that they still need to extend it further to the north in the springtime, but it’s preparation for a drill program. We will start in the southern hemisphere [in the] springtime, so probably gain access to the project in late September with a view to drilling pre-Christmas — October/November they will start drilling, looking for large, bulk-mineable-style oxide gold deposits.
INN: You mentioned that Mirasol is a prospect generator, so it doesn’t surprise me to see you with a partner. But I am wondering, do you usually have a partner come in at the pre-drilling stage?
SN: Mirasol has drilled some of its own properties in the past. In fact, we did some early scale drilling at one of the projects that is in the Gorbea joint venture, the Titan project … but generally what we try to do is take those projects to that stage and then we really carefully select our joint venture partners. We will make a shortlist of companies that have the skills that we need, that are often focused in the same region or the same country, so that there is a real synergy there, and invite those companies to come have a look at our projects. Yamana is a fantastic strategic partner for us. Not only a good company that does good exploration, but they are very successful operators both in Chile and Argentina, where we have projects. They were the right fit for us on these projects to be able to advance them and bring that synergy of skill sets that really complement what we do.
INN: So it is normally you taking initiative? I know you are working on that process for your Curahue prospect at the moment. Could you talk a little bit about the process there?
SN: Again, Mirasol is a prospect generator, but it has its own modified model that it works on. We actually discovered all the mineralization that we have, and all of our portfolios come from that. So we are not recycling an existing project or leveraging off of someone else’s work on a property. We do really high-end science, really good geology and with good people in the field and good capable teams. We identify and discover systems, large-scale systems that have the footprint that will attract a major partner.
… Curahue is one of five prospects [at the Claudia] project, [and it] is … adjacent to a large gold mine there that is operated by AngloGold Ashanti (JSE:ANG,NYSE:AU), a true, world-class epithermal gold field. Curahue in itself, what we have done there is discovered a really large vein system, and it hadn’t been recognized previously before because it was covered by a thin veneer of gravel. So we have had a few technical breakthroughs that have led us through a process to recognize now that we have a 15-kilometer vein trend there where we have been able to trench through the gravel, which is shallow in places, a meter or two thick to about 4 meters, and trench through on our geophysical targets and find a large-scale buried gold-silver system. So this has never been recognized before, it’s never been drill tested and it is right next door to a world-class mine that has demonstrated high-value ounces. Our property presents the potential for that kind of discovery as well. That is why we were able to attract interested parties into Argentina and to be interested in large-scale systems like that — we are not talking about looking for ounces that might be valuable some time in the future if the market gets better, we are saying that these projects can potentially deliver high-value ounces.
INN: So it is a good model, especially for today’s market.
SN: The joint venture model works really well in a good market and a bad market, but it is an excellent model for now. So we are very happy with that, and because we have been a successful prospect generator we have actually monetized a discovery. So we are sitting there with a good business model and cash in the bank and a really nice share structure. If we deliver a discovery, even if a difficult market like this, it will improve the share price — so this model works really well for us.
INN: That is everything from me today. Thanks so much for joining me.
SN: Thank you very much.
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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