Categories: Precious Metals
Topics: General Precious Metals

Millrock Resources' (TSX-V: MRO) Greg Beischer on Los Chinos Drill Results, Upcoming Drill Plans, and Its Relationship with Centerra

Gerardo Del Real: This Gerardo Del Real with Resource Stock Digest. Joining me today is Millrock Resources (TSX-V: MRO)(OTC: MLRKF) president and CEO, Mr. Greg Beischer. Greg, thank you for coming on today.

Greg Beischer: Oh, it's always a pleasure Gerardo, and Merry Christmas to you.

Gerardo Del Real: Merry Christmas to you as well, Greg. Now you recently announced results from the Los Chinos Gold Project, which was an early stage exploration property. That's a joint venture with Centerra, and I know that the results that came back, it is early stage. You didn't get the gold mineralization that you were looking for, but this particular property is 50 kilometers south of the San Francisco gold mine, which is operated by Timmins. I know you and I were talking about a lot of the similarities there, and it's a property that you and Centerra both still like. Can you share with us the results there, and just your perspective on what the path forward is in regards to Los Chinos there in Sonora?

Greg Beischer: Yeah, you know the results from that drilling program were honestly quite puzzling. We're scratching our heads, honestly. You know, the geologic setting is all just right there, and we had gold mineralization at surface in veins, altered rocks. We had done extensive soil sampling, got gold in the soil and pathfinder elements in the soil, there was induced polarization, geophysical anomalies, and everything looked just right. We drilled and the rocks looked great, the structures are certainly there. We drilled through them, the rocks were strongly altered, there was a lot of oxidized sulphide minerals and honestly, when we looked at the core, we were pretty confident that we had intersected a pretty significant zone of mineralization. It was really quite an unpleasant surprise to see the results, honestly to the point where we double checked a lot of the assays and just made sure that there wasn't a lab problem, but indeed there wasn't.

So at this point, we're still scratching our heads. Centerra has indicated that they'd like to continue to explore the property. They've set aside a budget for it, and I think that's the right thing to do. Everything is right about the project: we're in the exact same setting as the San Francisco gold mine, we've got those district and regional scale structures passing through the property that would create the dilation needed for a good sized gold deposit, and there's extensive alteration all across the property, and sporadic gold mineralization. So all the right signs are there, all the boxes are checked, and we agree with Centerra that we should continue to explore. But we're going to step back, really think about how we're going to re-approach the project, and we'll be doing that early in 2017.

Gerardo Del Real: Excellent. Now you brought up 2017 and you have a varied prospective portfolio of projects down in Mexico. Can we expect drilling from any of those other projects, Greg?

Greg Beischer: Yup, absolutely. Even after we come back to Los Chinos, I suspect that by the end of 2017, we'll mount another drill program there. But earlier, I believe that we'll be drilling new targets that we've developed on the Los Cuarentas project also in Sonora. Also optioned to and funded by Centerra Gold. So we've actually just completed a couple of months of field work, geologic mapping, soil sampling, induced polarization, and magnetic geophysical surveys. We've got a little bit more legal work to lock down one little piece of internal claim, and then we'll be in a position where we're ready to drill-test that target. I like the property. It's just to the north of the Mercedes gold mine, nice epithermal deposit and that's what we're targeting here. We see all the right signs for a medium or low sulphidation epithermal deposit, and the target has come together really quite nicely, and well worth drilling.

I suspect that we'll get on that fairly early in 2017, and you know we're going to be doing a lot more generative work. I think you can look for an expanded relationship with Centerra Gold, and potentially other partners on some of our projects, our copper projects and silver projects that may be partnered with the other companies.

Gerardo Del Real: Fantastic. Well Greg, I want to thank you very much. One last question before you leave here. How does the cash position look? I know that Centerra's funding, they funded the Los Chinos project, and they're also funding exploration work there on the Los Cuerentas property. How does the cash position look?

Greg Beischer: Yeah, the cash situation is fairly good. You know, we had done a financing in late 2015 and December 10th was the one year anniversary, and on that day the warrants that were issued at that financing had an increase in their trigger price. So as a result, there was incentive for investors to exercise their warrant, and we had quite a few people do exactly that, and so that added to our treasury. Right now we're sitting at around C$2.7-$2.8 million, and as you know, that's enough to last us quite awhile. We can stretch that out by virtue of expenditures being balanced by income from option payments and management fees on our exploration programs. So we're in pretty good shape.

Gerardo Del Real: Fantastic. Well Greg, thanks again for your time. I look forward to having you back on, and hopefully soon we have further news on possible partnering out a couple of the projects, and a possible enhancement of the current relationship with Centerra, so I'll be staying tuned for that.

Greg Beischer: Yup, let's talk again in early 2017. There's a number of things coming together, and I just have a feeling that next year is going to be a really good year for metal mining and metal explorers in general.

Gerardo Del Real: Looking forward to it Greg, thanks again.

Greg Beischer: All the best Gerardo, thank you. Bye.