Notes from Sunday Roast 12 Days of xMas interview - 03 Jan 2023

[DipSard]

Notes from Sunday Roast 12 Days of xMas interview - 03 Jan 2023

Interview:
https://audioboom.com/posts/8221717-12- ... ld-aim-ggp

Created from a software transcript export

* Hello and welcome to the twelve stocks for the twelve days of Christmas. I'm Phil Carroll, and today we're joined by Shaun Day, CEO of Greatland Gold. Welcome, Shaun. And Merry Christmas to you.
- Thanks very much, Phil. And Merry Christmas as well.

* Good. So, 2022 has been a momentous year for Greatland Gold. What we've securing pathway for fully funding its share of the development of Havieron. Do you want to recap what you have achieved in 2022 and what investors can expect to see potentially in 2023, please?
- Yeah, look, I think 2022 was a momentous year. We completed building a lot of the team. We resolved the option process with Newcrest. We resolved that in a way where not only we're victorious, but we kept the full 30% of Havieron, which was the best possible outcome to my mind.
- On the back of that, we were able to do an institutional equity raise. We were then able to combine that with a triple whammy announcement of the debt piece, the $220m debt, bringing Wyloo in as a strategic investor, and three new directors, Jimmy Wilson as an executive director, Elizabeth Gaines as Deputy Chair, and Mark Barnaba as chairman, who are all real absolute A grade talent into the organization.
- And then just a week or so ago, we completed the divestment of the Tasmanian assets. But I think really importantly combined that divestment to focus on our core assets, but with an ongoing interest both through milestone payments and royalties into those Tasmanian assets.
- So, a busy year, I think, in anyone's language, but successfully so.

* Yeah, where do you see Greatland on the curve, if you like? I mean, obviously there was a lot of furore and we're sitting with Greatland Gold worth over a billion pounds at one point. And now we're sitting obviously significantly lower than that. But completely derisked or not completely, but in terms of explorer, miner, you are severely derisked, if you like in terms of all the cash that's available now. And, you know, with a major partner as well. So how do you see that all fitting in over the next twelve to 24 months?
- Yeah, look, it's a fair question, Kevin. I think at one stage the market was probably really just enjoying and rejoicing in the growing size of Havieron, and that is the foundation to our company. Probably as I've come in and taken us from an Explorer into a company that is able to develop Havieron, we've put a little bit of the focus on the funding.
- That was something that was not addressed prior to 2022. I think the fact that we've addressed it successfully is a great derisking event, but it has perhaps highlighted those aspects rather than just the onwards and upwards of the exploration.
- But I think what you typically then find is as you come into production, which is slated for March 2024, the market can go through this focus on risk of development and really start looking forward to the maximum part of the cycle, which is when you go into free cash flow generation.

* Yeah. And I mean, from that perspective, how big do you think Havieron is going to be? Do you think it's going to be bigger than you materially imagined? Maybe a year, 18 months, two years ago?
- Yeah. In one of the very early interviews I gave, I talked about my first week at Havieron at Greatland. And I'd obviously looked at a lot of the data before joining and had taken a confident view that it was a world class asset. But I think that first week I was absolutely delighted.
- I spent a week with the geology team going through particularly the resource geology, and I came away from that saying, this is even better than I thought. And I think that's proven to be the case. It just continues to drill well. And for me, I think what's exciting about this ore body, and it's not recognized by the market, is this has the potential to be another Telfer, to put that in context. Telfer, I think, has a total mineral endowment of about 20 million Oz.
- It's taken 35 years to mine around 13 million of those ounces. And Telfer has been a top five Australian gold mine for most of those 35 years. I think similarly, you can see on a basic grade zonation of Havieron, you can see a total endowment there in the underground of around 20 million Oz.
- Now, we already have six and a half million of those ounces defined in what I'd describe as a high-grade resource. And that continues to expand. So, I think you could look at is it possible to have 13 million mineable ounces at Havieron as well? And this is literally in the same weight division as a Telfer, which would be a remarkable achievement.
- So I think there's a lot of excitement still there with the exploration.

* I presume each month as you explore more, the JORC will just continue to steadily increase over the next 12 to 15 to 18 months. Yeah, I think the last JORC update to that six and a half million ounces has a drilling cut off of November 2021. So, you already know the result. You've already seen the last almost 13 months now of drilling data and it's really good.
- In fact, I think in our latest presentation we actually summarized the slide with a lot of the key intercepts… their outstanding results. So, I think it should give everyone a lot of confidence about that resource, has the opportunity to expand again.
- It's been running at about a 43% compound average growth rate (CAGR) since the maiden resource a couple of years ago. And I think that's been an increase of two and 2.9 million Oz from memory, I would have thought that kind of increase, again, is achievable, but time will tell.
- But it's certainly when you start taking it from six and a half and you add that kind of magnitude to it, it really is getting becoming a very large ore body of high grade ounces. Not just the overall endowment, but that high grade area where you'd expect to see mining activity.

* Yeah. So, we could be talking about eight to 9 million Oz of JORC. At what grade roughly are we talking about overall?
- Well, look, when you focus on that southeast crescent, you run around 4 grams. That's largely reflected in that reserve grade. But when you go into that broader resource, which brings in the Eastern breccia and the Northern breccia, I think our resource runs at about 2.2, 2.3 grams. So, I think when you're looking at the overall universe of good grade material, I think you're talking in that two and a half grams.
- But that's good sitting next to existing infrastructure, that's all material you'd really want to focus on. So, I think it's an exciting platform and a high-grade backbone through that southeast crescent just pays to get the infrastructure in to extract as much of that ore as possible.
- So, it's a lovely platform to have.

* Yeah. High-grade paying for everything, and then you basically don't have the same overheads after that to continue to be profitable. So, tell us then about Greatland Gold’s other opportunities then, obviously Havieron is obviously a big project and one that's going to cement the future of Greatland Gold, but it's not a one trick pony.
- Yeah, look, I think about the future in three ways. What we just spoke about, which is delivering Havieron is an absolute core focus for us. But investing in that drill bit.
- And if we spend a moment on the exploration investment, I see it in kind of three parts. There's continued investment together with Newcrest on the mining lease of Havieron itself and understanding the nature of that system. And if there is another satellite deposit or extension of Havieron, that's obviously incredibly exciting.
- But secondly, and perhaps what's most exciting for Greatland shareholders is those 100% owned tenements particularly Scallywag to the Northwest. But across our portfolio in the Paterson, I think the quality of geophysical kind of targets that we have across those leases is really exciting.
- We continue to look at opportunities to add land or indeed subtract land from our portfolio to continue to refine and focus on the best targets. But I think that footprint we have in the Patterson is exceptional and there's no better place to look for gold and copper than where it's already been found.
- And then just to remind people, again, it's elephant country. You've had Telfer, a top five gold mine for 30 plus years, Havieron, which is shaping up to be of similar ilk. And then you've got the Rio Tinto Winu project to the north.
- So, if you do get onto a system in the Paterson, it has every opportunity of being an absolute beast. I also kind of really want to highlight Ernest Giles. I think that's as good as exploration address as you'd see some really neat geophysical targets there as well. It remains subject to Indigenous or First Nations agreement to actually get a rig onto that area, but I'm very optimistic that that will be the case in 2023. And I think the geology team is incredibly excited about that. There are some cracking opportunities in the exploration portfolio.
- And then thirdly is the organic portfolio, which is where we look to add either additional exploration or a cash flow project or a project that has a direct pathway to cashflow.

* One question is on my mind, really, is just the whole gold copper prospect. I mean, earlier in the year we did do a podcast on gold and copper, but it seems to me very much like with these economic times that we're in at this moment in time, surely, surely there's got to be a positive uptick in the price of gold and also the price of copper.
- Yeah, look, I feel good about both commodities. I love the fact that we have the diversification in the existing portfolio of the base metals and copper is the highlight there, but we continue to try to understand the other base metals in that Havieron system.
- But, look, I think what you typically see is a cycle where reserve banks are trying to crush inflation is not perfect conditions for gold. Gold will keep pace with inflation, but real interest rates can depress gold prices.
- So really what we've seen is an environment where potentially gold prices could have been depressed by that tightening cycle of reserve banks and banks of England around the world, but really, gold has stayed remarkably strong. Anything that started to move what seems to be into a strengthening cycle, and as we get real interest rates under control and back to where they're more parity with inflation and gold should keep up with inflation, I think we actually have a much stronger gold environment.
- Copper. I still think it's the best way to play an EV cycle. There's a huge amount of narrative out there that copper should at some point have a breakout year, and I think we should celebrate that. We have very meaningful exposure to that. And all of it is long term exposure and all of it is in a tier one jurisdiction. And the longevity of that exposure is really good because we don't have to pick the cycle. We will go through the cycle two or three times with this asset.
- There will be times when everyone in the world will want to be a copper gold producer, and there will be times when not everyone will want to be, but we will get to experience that, and that's where mine life is incredibly advantageous.

* Well, sure. We wish you all the best into 2023, and I'm sure the shareholders and listeners have got a lot of things to look forward to. And before you go, though, obviously, this being a Christmas themed podcast, what is the best Christmas present that you've ever received or maybe given?
- Well, I think that the one still most memorable for me is when I was about ten years old, getting a big blue ten-speed bicycle. That is the one. Coming down and seeing that under the tree is still the one that is very memorable to me to this day as a young kid, I think that's when getting presents is the most fun. And I think these days, giving presents to the kids, that is just a delightful as you go in there.

* You'd be surprised that there's a lot of CEOs and chairmen who say the same thing. And I always go with a bike because it was the one thing wasn't that you wanted to get out on Christmas Day, get it all set up and go out and ride it around the streets with the mates and so probably something like a rally drifter or a rally chopper or something like that. Or even a striker.
- Yes. And I remember cleaning that bike just about every time I rode it for the first year or two. So, it was a prize possession for a long period of time. Yeah.

* So, what will Christmas dinner be in the Day household?
- I think it's pretty traditional. It's going to be… the Christmas ham for me is the prize of place, the turkey with stuffing. And also, I do like the potato salad, so that's the three in the hierarchy for me. But the ham and potato salad in particular is a bit of a focus.

* You're not going for the lobster on the Barbie, then?
- No. You do sell a lot of seafood in Australia around Christmas because it is our summer, which is always a little bit topsy turbine. But no, I think you just can't go past Christmas ham. We wouldn't be Christmas without a Christmas ham.

* Yeah, good. Shaun Day. Greatland Gold. Thanks very much for your time.
- Phil and Kevin, merry Christmas to you and thanks for taking the time. And for people tuning in, merry Christmas.

Download Link:
https://www.mediafire.com/file/1o3to46k ... 3.pdf/file