Categories: Precious Metals
Topics: General Precious Metals / Gold Stocks

Revival Gold (TSX-V: RVG)(OTC: RVLGF) CEO Hugh Agro on the Path to Production at Mercur

 

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president and CEO of one of the most undervalued gold speculations in the resource space. I'm talking of course about Mr. Hugh Agro of Revival Gold. Hugh, how are you today?

Hugh Agro: Thanks for having me, Gerardo. I'm very good.

Gerardo Del Real: Listen, let's get right into it. I've had more calls in the past week and looked at more deals than I've had in quite some time during a one-week timeframe, and I actually just got off a call about a US based project in the Western United States that's got maybe four or 500,000 ounces of gold, but a couple of hundred thousands of high-grade oxide that are heap leachable right at surface, right? And those projects are slowly but surely being discussed a whole heck of a lot more in terms of getting initial production plans accelerated and catching the sweet spot of this amazing gold market that we have, and then using that as a non-dilutive way, using the proceeds to fund aggressive exploration for this cycle.

I love the news release that you had yesterday talking about a potential redevelopment for the Mercur project, and I thought it'd be a perfect time for you to come on and just talk about how things are progressing.

Hugh Agro: Well, Mercur is definitely at the front of the queue for us. It's been a huge add to our story. You know that we're building a multi-asset platform in gold in the United States. Great geography, a great time to be in the US developing a business given the current administration and the states we're working in and their administrations at the state level. So I think our timing is great, and Mercur, our project in Utah is rounding the corner here now for our PEA, our preliminary economic assessment expected within the next two months. And the press release you're referring to that we put out yesterday really was to cover some of the narrowing in on where we're going to come out here and give our investors a little bit of color, a little bit of flavor for the work that's been going on.

Gerardo Del Real: Well, let's give them color and let's give them the flavor, right? What have you been up to? You're targeting approximately 80,000 to a 100,000 ounces per year of gold production over a minimum, and I want to stress that, nine to 10 year mine life. I'm not the brightest bulb in the box, right? I pride myself on being a simple guy, but I could do the math and say, well, 100,000 ounces per year of gold times $2,800, $2,900 gold. That's a very profitable operation at current prices. Speak to what you're doing to kind of fast-track that and move that forward.

Hugh Agro: Well, the flavor is tasty, to put it that way. So on your math, we're looking at close to $300 million a year of revenue. So think about that. And this is what's so exciting about junior developers like Revival Gold, is we provide a lot of leverage to that upside in gold. So $300 million of potential revenue from a project in the domestic United States. It is going to take us time to go through the detailed engineering and the permitting, but you'll remember that this site is on private ground and it's in a dry, semi-arid location. So those two factors make for relatively quick permitting timelines. We're talking about a project that could be in production within three years. We'll see where all the details come out when we put out the PEA, the preliminary economic assessment in a couple of months time, but to that 80 to 100,000 ounces a year from a project that's one hour from the city of Salt Lake, sure sounds and feels and tastes pretty good.

Gerardo Del Real: Well, look, my friend, colleague, and business partner, Nick Hodge, was on a site visit recently at the project. He came away kind of glowing with the potential for this very, very profitable, profitable production profile. And look, we're talking just Mercur here, right? You talked about potentially $300 million a year in revenue there. The current market cap, folks, for those of you paying attention up there, of Revival Gold's entire market cap that includes two projects is $67 million Canadian. There is a severe disconnect between the opportunity and the current prices right now. I don't know how long that lasts. I know when things start moving, they move quickly. I anticipate a wave of M&A as producers, mid-tiers and majors alike start reporting results and have flush balance sheets. I've got to believe that your fielding phone calls of people kicking the tires and maybe even more than just kicking the tires. How do you view upcoming M&A and the potential there for a rapid rerating via that?

Hugh Agro: We are seeing lots of interest, and this is one of the reasons why we want to be current with our investor base so that they know the progress we're making with the projects. And we're talking about Mercur. We're also making progress with our Beartrack-Arnett project in Idaho. In fact, I was out with our VP engineering and development, John Meyer with the state government authorities in Idaho two weeks ago. And just on the back of that, they've released the Speed Act out of the legislature, which is all about accelerating the pace of permitting and simplifying the process of working through state agencies. So there's some really good developments on that front.

At Mercur, with our project here in Utah, these details, little pit analysis, trade-off studies, preliminary site layout planning, waste rock storage facilities, mine scheduling, heap leach process, ancillary infrastructure designs, all of these aspects are the sorts of things that the bigger players and some of the more sophisticated financial parties are watching and keeping a close eye on as we pull these things together. So it's really incumbent upon investors to make themselves aware of the progress that Revival Gold is making and how that translates into value creation.

We will have our PEA with lots more details and economic factors as they get finalized in the next couple of months here, but really it's a process that takes quite a while to come together. And we want to demonstrate the progress with the project so that we keep, not just those that are under CA and looking through data rooms up to speed, but also our investors. And it's all with a view that we've got great projects here, great portfolio, trading outstanding value, and we want to make sure that value is seen by all.

Gerardo Del Real: I think the upcoming PEA here that's on schedule within the next two months, I believe, is going to be a milestone moment for the company, for shareholders, and for potential new shareholders to really crystallize that the opportunity here and the disconnect between the current valuation and the potential that exists. Anything else to add to that, Hugh?

Hugh Agro: Look, you can hold me to this, Gerardo, but I'm certainly hoping that we'll be able to double our underlying NAV as we move ounces from resource into economic studies and plans, and that's the process of value creation. Remember, we started this company with nothing. We've now got two projects, 6 million ounces, target production 150,000 ounces a year from heap leach in the first phases, and a whole heck of a lot of exploration potential beyond that. The value development at Revival Gold is moving along much faster than our share price, and I think it's a good time to be getting on board if folks are not already on board with the company.

Gerardo Del Real: Hugh, thanks for your time. Completely agree. As always, look forward to having you back on soon.

Hugh Agro: Okay. Thanks, Gerardo.

Gerardo Del Real: All right, cheers.

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