Categories: Precious Metals / Mining Stocks
Topics: Gold Stocks / Copper Stocks

Hannan Metals (TSX-V: HAN)(OTC: HANNF) CEO Michael Hudson on Expanding the Mineralized Footprint at Previsto as Drills Rev Up on Multiple Potential Company-Making Prospects Nearby at Belen in the Peruvian Back Arc

 

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the executive chairman & CEO of Hannan Metals (TSX-V: HAN)(OTC: HANNF) — Mr. Michael Hudson. Mike, great to have you back on. How are you today, sir?

Michael Hudson: On top of the world, Down Under, Gerardo. Thanks for having me back.

Gerardo Del Real: Well, listen, I had the pleasure of speaking with Exploration Insights quarterback, Mr. Joe Mazumdar — whom you know very well. He's been in this business for, I want to say, three decades or so in some capacity. 

He is an economic geologist who knows his stuff, and we had a good 20- to 30-minute conversation. I want to say about 75% of that — because I’m openly biased — ended up being about Hannan.

And again, it's one thing for me to be excited about the potential for company-making projects, and then get excited about the potential for finding a Cripple Creek-type analog at Previsto and being able to explore that this year and drill it next year. But it's another thing when Joe Mazumdar, who typically is knowledgeable as all heck but a whole heck of a lot more reserved than I am — which, in fairness, most people are — says you could walk up to Previsto and you’ve pretty much found the source.

Every major company in the world is looking at Previsto. So I want to start there, because the most recent news release talks about identifying two new zones of gold mineralization at Previsto and expanding the footprint to 650 meters of strike. That’s within a 4 X 4 or 5 X 5 km soil gold anomaly.

And I want to provide the context because you’ve done a great job of explaining — to my simple brain — how the high grade is important in these systems but that we have to keep in mind that the analogs all demonstrate that the continuity in the lower grade and the scale is really what gives a lot of torque to future mining once you actually get to that stage in the system. 

Now, that’s far down the road but this looks like it’s the real deal here, and all of the major companies have their eyes on it. I know I couldn’t be more excited to get a drill going one day, but for now, I’m really excited about the work in the field. Can we speak to the latest release?

Michael Hudson:  Sure, I think they say — just going back to your enthusiasm — no conflict, no interest. Or... no interest, no conflict, even.

Gerardo Del Real: There you go. I like that.

Michael Hudson: Anyhow, we are continuing to expand this really interesting discovery we call Previsto. Like you said, it’s got a very big footprint — from the magnetics to the potassium in the radiometrics to the soils at greater than 0.1 gram over essentially 5 X 5 km.

We found one sweet spot in it, and as we're starting to do more detailed work, that's what we call Previsto Central. Now, that extends over 650 meters. We've obviously had the very high-grade channels that we put in part of that area — nearly 70 meters at 2.4 grams and, overall, something like 135 at 1.3 grams. But we are seeing very high grades — 10 to 20 gram numbers coming out of that and 2 to 3 meters at 15 to 20 grams.

That is what these alkalic systems are. They're a sea of lower-grade gold, and you find these very high-grade parts that can be amazingly rich. That’s what Cripple Creek was. That’s what Porgera is and was. And generally, the old timers — I’m talking 100 years ago — started on very high-grade parts at Cripple Creek, and now they’re still leaching those lower-grade parts even today. So that’s the nature of the system we’re finding.

We’re continuing to expand. It’s hard territory — you’ve been up and near there. We hadn’t made the discovery when you walked there but it’s hard yards in steep jungle terrain so it’s not easy. But the team is doing an amazing job.

The next step is to try and expand those high grades and show that it’s not just one or two high-grade zones but to demonstrate continuity and repeatability. So we’re back in the field looking to do that now. We’ve got this much larger footprint that we now know from geochemistry, geology, and lithology — we know the rocks that contain the gold, so we’re getting much better at identifying it in the field before even waiting on the assay lab.

It’s still very early days in a massive area that’s delivering a style of gold that is very attractive to everyone in the industry — from ourselves to the majors. The old alkalic gold systems are the holy grail of big and high grade. And we’ve got one. We’ve got that first-mover advantage. We’ve got the big ground position. There’s a lot more work to do, and we will be getting drill rigs on there as soon as we can.

We’re starting the environmental studies in the next few weeks. We’ll have 10 to 20 people collecting all of the baseline data to put that permit application in by Q3 this year.

Gerardo Del Real:  That's exciting — and as exciting as that is, what’s happening right now is the testing of the first priority target, which is Vista Alegre. There is a drill rig turning as we speak.

The Belen area — which is host to, I call them projects, let’s call them targets in this conversation — but the three targets, Vista Alegre, Sortilegio, and Ricardo Herrera… there should be roughly 5,000 meters initially across 18 diamond drill holes. How are things going at Vista Alegre?

Michael Hudson:  It’s progressing well. That was the second part of this — really two releases in one. We’re just doing so much now we needed to keep the market informed and up to date.

So we have the drill rig turning. The first hole is finished at Vista Alegre — down to 184.6 meters — and that’s being cut at the moment. We've got all of our systems in place, transitioning from a grassroots explorer to a drilling company. You make sure you’ve got the right people there with the right systems… and that’s our bread and butter, if you like.

But we’ve made sure that’s occurred. We've got everybody in place. The samples are getting to the lab. The drill rig is spinning. And it’s very early days at the start of a drill campaign that is going to test any one of these three areas you just mentioned — any of which could be company-makers in their own right.

We are drilling blind targets for the most part — meaning there’s not a lot of outcrop like we’re seeing at Previsto. We see a lot of smoke in boulders and soil anomalies, and we’re testing the geophysical targets beneath the soils where we don’t really see much rock.

So we need to learn — we need to understand where the gold is in these systems. Ideally, you get it in the first hole. But if you don’t, that leads you to the second hole, etc.

Each one of these projects has massive potential from the epithermal to porphyry end of the spectrum. And conversely, these are all the second prizes until we get to Previsto. But you don’t want to downgrade them in your head because they’re great targets in their own right.

Gerardo Del Real: Absolutely. Look, I think with $3,400 gold, silver wanting to break through $35, and copper looking like it wants to print brand-new highs, the timing couldn’t be better for a discovery or a couple of discoveries.

We didn’t touch — going back to Previsto — on the silver values, and I should mention there will likely be a silver contribution at Vista Alegre as well, as we’ve seen. We’ve seen boulders that have 2.72 grams per tonne gold and 44 grams per tonne silver, which is not insignificant.

I’m excited. I know that I would ask you when we can anticipate seeing results. I read the release; it said likely going into July. I know that can vary by a week or two on either end depending on the pace of the program, the turnaround with the labs, and, frankly, what you’re seeing on those initial holes. I couldn't be more excited.

Anything else to add? I’ve got to ask before you leave about the continued channel sampling that’s going on at Previsto. I’ve had several people excited about it, obviously, but also asking if they are going to continue that work to better understand the system?

The answer, of course, being yes — but in what capacity are you doing that, and in what capacity do you plan on doing that for the rest of the year?

Michael Hudson: Yes, we have teams out there right now at Previsto, and we are balancing the mix of demonstrating the high grades have continuity — like I mentioned before — and repeatability. So we’re working within 10, 20, 30, 40, 50 meters of those higher-grade areas we’ve identified.

But as you saw in this release, we’re also working up to half a kilometer away trying to test the system at a larger scale — which is the other part of it. You don’t want to focus in on a ‘postage stamp’ too quickly but you want to demonstrate that the high grades have repeatability and continuity, if you can, and then you want to demonstrate the scale.

So they’re the two end members that we’re grappling with. We’ll be bringing more geologists to the team over the next month or two to increase that work because we’re very excited about what we’re seeing there. And we know we’ve got a window — we know this is the dry period in that part of the world. It’s harder to work from November to April so this is our time to get lots of work done in the field. And we’ll make sure we make the most of it.

Gerardo Del Real: Exciting stuff. I know you’re intimately involved with what now has morphed into one of the most exciting gold discoveries of recent times. I’m talking, of course, about the Sunday Creek project with Southern Cross Gold Consolidated, which now commands a robust market cap of $1.5 billion and seemingly headed much, much higher.

That’s turned out to be a phenomenal project. It’s worth mentioning for the simple fact that I want to emphasize to people the fact that there’s only been a single drill hole completed at Belen and yet you have a healthy market cap. 

I want to emphasize that this is a team that explores and drills methodically and has done this many, many times before. And clearly, the majors understand that, and they really understand it as it relates to Previsto. I’m excited to get these first three projects drilled and to have better context as to the potential of those.

Michael Hudson: How great is exploration and what a value creation tool it can be when you have success. That’s why we’re all in the business. It puts tingles down your spine when you’re finding things. And yeah, here we go again on the other side of the world. 

Gerardo Del Real:  Excellent work. Congrats on all the success, Mike. Looking forward to more. Take care.

Michael Hudson: Thanks, Gerardo.

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