Categories: Precious Metals
Topics: Gold Stocks

Trident Resources (TSX-V: ROCK)(OTCQB: TRDTF) CEO Jon Wiesblatt on First Drilling in 30 Years at High-Grade, Near-Surface Contact Lake Gold Project in Saskatchewan’s La Ronge Belt & What Cameco May Have Left Behind

 

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the CEO of Trident Resources (TSX-V: ROCK)(OTCQB: TRDTF) — Mr. Jon Weisblatt.

Jon, it's great to have you on. It's an exciting time in the gold space and exciting times for Trident. You're commencing your inaugural 5,000-meter drill program at your Contact Lake high-grade gold project. It’s taken a lot of behind-the-scenes work to get to this point… so congratulations.

We talked a bit off-air, and I know you're excited. I wanted to save that enthusiasm for the interview. Tell me what this means, and tell me why you're so darn excited.

Jon Weisblatt: Yeah, Gerardo, Contact Lake, formerly the Contact Lake Gold Mine, is one of several deposits in our portfolio in northern Saskatchewan that make up the La Ronge Gold Belt here in Canada.

Putting aside the regional excitement we have about creating Canada’s next prolific gold mining camp, the Contact Lake deposit hasn’t seen any work in nearly 30 years. This will be the first exploration since Cameco shut the mine down in 1998 after producing about 200,000 ounces at a head grade of 6 to 7 grams per tonne.

What’s really exciting is why Cameco shut the mine down because it left an opportunity for future investors and a company like Trident.

The mine closed in 1998 for two reasons:

1. Gold prices were under $300 per ounce.
    
2. Cameco was focused on becoming one of the world’s largest uranium companies.
    

They’ve clearly succeeded in that. But since they walked away from Contact Lake, gold prices have increased 10X. Today, we're looking at $3,400 gold on the December contract, which makes these types of projects incredibly compelling.

Cameco also spent C$65 million in the early 1990s to build this underground mine. In today’s dollars, that’s well over C$125 million, and they only produced 200,000 ounces. We believe they left behind a significant amount of resources and even reserves.

This program will help us better define the mineralization and grow our ounce count in Saskatchewan. It’s a very exciting time for Trident. We’re fully funded to drill this program. The company is well-capitalized — even over-capitalized — so yes, it’s a very exciting time for us and our shareholders.

Gerardo Del Real: When you say well-capitalized and fully funded, you're being modest. I think you should elaborate because the risk-reward proposition here is pretty significant. You're in a top-tier jurisdiction, and this is the first modern exploration at Contact Lake in nearly 30 years. Can you speak to that a bit?

Jon Weisblatt: Absolutely. Let's talk about our capitalization for a moment. Right now, the market cap of the company is just C$19 million. We have over C$11 million in cash and marketable securities on the balance sheet. That means investors are effectively getting this company for C$8 million. And for that, you're getting 1.5 million historical gold-equivalent ounces in the ground. That’s about $5 per ounce.

Gerardo, as we’ve discussed, I come from an institutional investing background. I’ve very rarely seen a valuation proposition like this with this level of asset quality, in this kind of jurisdiction in my career.

So, putting aside my executive role at Trident, I truly believe this is one of the most compelling opportunities I’ve come across. Investors have the chance to make multiple times their money from these levels. 

We’re about to begin our 5,000-meter drill program at Contact Lake later this month. And just to inject a little more excitement into your listeners’ minds, Cameco’s historical drill logs include intercepts like:

• 20.5 meters of 12.8 grams per tonne
   
• 18.3 meters of 10.4 grams per tonne
   
• 0.6 meters of 2,616 grams per tonne
   
• 0.5 meters of 94 grams per tonne
   

There’s a lot of high-grade gold in this system, and we’re about to find out if it’s still there. We’re quite confident it is.

Gerardo Del Real: And just to give more context to those numbers, that 20.5 meters of 12.81 grams per tonne wasn’t from 600 meters down. It started at 56 meters. The 18.3-meter interval of 10.41 grams per tonne started at just 39.5 meters.

Even the 2,616 gram-per-tonne intercept was from 205 meters, and the 94 gram-per-tonne hit was at 138.3 meters. That’s all relatively shallow, which is important when you’re talking about grades like that if you can prove continuity, right?

Jon Weisblatt: Exactly. It’s incredibly shallow. Let me give you even more context. There’s only one currently operating gold mine in Saskatchewan; the Seabee Santoy Mine owned by SSR Mining. That mine goes down to about 800 meters.

In contrast, the Contact Lake mine has never been mined or explored beyond 300 meters. The mineralogy, geology, and gold continuity at Contact Lake are very similar to the Seabee Santoy Mine, and that means there’s enormous exploration upside both at depth and along strike.

A lot of the intercepts we highlighted in our press release this morning are at or near surface. And there’s so much potential below 300 meters, which is where Cameco stopped exploring.

So yes, a ton of opportunity, a ton of upside. And by the way, Gerardo, Contact Lake is just one of several deposits we control. There’s a ton of gold, a ton of value, and a ton of opportunity ahead for Trident Resources and its shareholders.

Gerardo Del Real: No doubt. Exciting stuff and exciting times. I can’t wait to start seeing those assays come in. I’m really looking forward to having you back on when the numbers start to hit. Thanks so much for your time, Jon.

Jon Weisblatt: My pleasure, Gerardo. Thank you very much.

Gerardo Del Real: Alright, take care now.

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