Generally speaking, conditions are challenging right now in the gold mining sector. The price of gold has pulled back and many gold mining companies have seen serious erosion in their share price in recent months.
One junior gold mining company that has shown particular resilience however is White Gold Corp. (TSX: V.WGO, OTC – NASDAQ INTL.: WHGOF, Forum). What sets WGO apart from many of its peers?
While there are many reasons for this, perhaps one of the simplest way to address the question is with four names: Agnico Eagle, Kinross, Pat DiCapo/The PowerOne Group and Shawn Ryan.
The first two names will be familiar to all gold mining investors. Agnico Eagle Mines and Kinross Gold are two leading gold producers globally. The other names may not be as familiar but should be. Mr. DiCapo and his PowerOne Group have been behind multiple major success stories in the mining sector across the globe. And last but not least, if you don’t know who Shawn Ryan is, you need to know.
So who is Shawn Ryan?
When it comes to the Yukon, there is no one on the planet that has been more successful having recently discovered millions of ounces in multiple high-grade gold deposits with his deep knowledge of the territory and unique and cutting edge scientific exploration methodology. Each of these parties are exemplary in their own right, together, they are nothing short of a dream team.
Ryan’s first success was the high-grade Golden Saddle discovery in 2009 on his White Gold Property that was optioned to Underworld Resource and then acquired by Kinross for $140M, launching a modern staking rush in the White Gold District. Following the Golden Saddle discovery was the Coffee deposit that was discovered by Shawn and just recently acquired by Goldcorp for $520M in 2016 from Kaminak. They were just 2 of Shawn’s projects. He has picked through the Whited Gold District with his novel approach (more on that below) for nearly 20 years and still has around 30 of the most prospective properties which he believes are amongst the best of the best, not to mention they make up about 30% of the district.
Enter White Gold Corp.
In September 2016, the Company partnered with Shawn Ryan whereby he rolled in all of his projects in the White Gold District to create White Gold Corp. An upcoming full-length Stockhouse feature will take a more detailed look at White Gold’s operations, as well as some of the large take-outs that have recently taken place in this region.
Before we write that feature, we wanted to share more information on how Agnico Eagle Mines, Kinross Gold, PowerOne and Shawn Ryan all got involved in this Company. We asked WGO’s CEO, David D’Onofrio to connect the dots for the Stockhouse audience.
Before we start discussing WGO’s operations, please provide some brief background on the Company.
White Gold Corp was formed though acquiring Shawn Ryan’s portfolio of properties in the Yukon’s White Gold District. Shawn had accumulated these properties over a decade and built a massive geological database on these properties spending over $25M during years of exploration in collaboration with a number of junior exploration companies. During the last resource downturn, these companies could not maintain their option agreements and Shawn received all the properties and related data back. After further evaluating the properties and data over the following years, Shawn kept the best properties and created a 3-year exploration plan to systematically explore them. This time however, Shawn wanted to work with a group that could provide the capital and the relationship to the majors to allow for the execution of this plan. PowerOne was the perfect partner. We had an existing relationship with Shawn, the strategic relationships he was looking for and an impressive track record backing strong management teams. Shortly after forming the company we presented the business plan to Agnico Eagle, who were very impressed with the opportunity to participate in a district-scale project. They backed this systematic approach and invested to become a 19.9% partner of WGO. Together with Agnico, we embarked on a 3-year exploration plan to systematically explore our land package.
When did you first take an interest in the White Gold District?
There has been over 20 million oz of gold placer mined from the creeks in the White Gold district. However, the sources have remained undiscovered for decades until just recently with the discovery of the Golden Saddle and Coffee deposits. Experts believe there should be many more sources. And with so little exploration done historically and it being in such a great jurisdiction we believe this is an incredibly unique opportunity to become a world-class gold camp. We are very bullish on the region and liken it to the early days of the Timmins camp – a district-scale opportunity in Canada, one of the most mining-friendly jurisdictions in the world. And we could own 30% of it. Imagine being able to own 30% of the Timmins camp 50 years ago. Yukon has also become a very attractive place for mining projects, with government investing heavily in infrastructure projects that will drive down CAPEX costs and undoubtedly improve project economics. Just last year the territorial and federal government announced a $360 million project to build and improve roads through the Yukon’s mining regions, including the White Gold District. This road network will provide road access to almost every one of our properties. This has also attracted the interest of the mining community globally with many majors having recently invested in the Yukon.
White Gold Corp is reporting that it now holds roughly 40% of this gold District. What subsequent moves has WGO made to build on its land package and what is the total size of the Company’s holdings today?
After partnering with Shawn Ryan, the company also approached Kinross who had been in the district since 2010 after they took out Underworld Resources for its 1.2M+ oz high-grade Golden Saddle deposit for $140M. With their many projects globally, Kinross hadn’t focused on their Yukon portfolio as much as they would have liked. They were the first major to enter the district and were still very keen to stay there. A deal was arranged whereby they would vend us their Yukon portfolio and become 19.9% shareholders in WGO, maintaining exposure to their former portfolio and also now owning a piece of our broader portfolio which now totals 30 projects on over 390,000 hectares, representing 40% of the White Gold District, and would be actively explored by the highly sophisticated WGO team, which also includes Jodie Gibson who was directly involved with the Golden Saddle discovery and Rob Carpenter a founder of Kaminak which made the Coffee discovery.
You haven’t simply acquired some of Shawn Ryan’s White Gold claims, you’ve “acquired” Shawn Ryan. Please explain the role he plays in your operations.
That is key to the story – not only have we assembled the largest and most prospective land package in the district, we have also assembled a team that has been directly involved with all recent major discoveries in the district. This team is led by Shawn, who has been with WGO as Chief Technical Advisor and a director since its inception. Shawn brings a wealth of operational expertise and has led the company in the use of GroundTruth’s advanced exploration techniques developed by Shawn Ryan over the past decade which provide unique insights never before had in the region and also allows us to do work at a fraction of the cost and with greatly reduced environmental impact and need for permitting. This sophisticated and cutting-edge exploration approach really impressed Agnigo and Kinross and further differentiates White Gold from its peers.
You just completed a $10 million private placement, reporting that AEM and Kinross continue to each hold their 19.9% stakes in the Company, post-financing. Does this mean that they also participated in this recent offering?
Yes, both Agnico and Kinross participated to maintain their 19.9% stakes respectively. We are very fortunate to have these two majors as partners. In addition to providing financial support, we work very closely with their technical teams who help guide and evaluate our operations. To have access to the expertise of two majors is very unique and has delivered tremendous value.
What is the overall size of this gold District?
The White Gold District is located just south of Dawson City and is about 165km by 200km. It lays along the Tintina Gold Belt, homed to famed mines such as Fort Knox and Pogo. We own 390,000 hectares which is approximately 40% of the district.
The gold mining companies that are active in the White Gold District aren’t just looking for gold, they are finding it. Could you total up these recent discoveries for investors?
Absolutely – there’s been a number of major discoveries in the district, the three largest being Golden Saddle, Coffee, and Casino. Golden Saddle is sitting around 1.25M oz based on our mineral resource estimate, Coffee has just over 4M oz Au, and the Casino project has reserves of 8.9M oz Au as well as 4.5B lb of Copper. This brings the total for the relatively early-stage district to over 15M of gold, not including a number of smaller deposits.
Part of that large resource total are ounces belonging to WGO (and its shareholders). Please outline your current resources.
Our mineral resource estimate includes 960,970 ounces Indicated at 2.43 g/t gold and 262,220 ounces Inferred at 1.70 g/t gold. What is most exciting about this deposit is that it remains open in multiple directions and has been shown to increase in grade at depth. The deposit also features a high-grade core of almost a million ounces grading over 3 g/t. Despite the minimal amount of drill testing performed to date, mineralization on the Golden Saddle and Arc deposits have been shown to extend beyond the limits of the current resource estimate. Geologic models in this area conceptually include an estimated 7 million to 10 million tonnes grading from 1 g/t to 1.5 g/t gold. We are very optimistic about the opportunity to significantly grow the size of this high-grade deposit.
What is the potential for resource expansion on this large land package?
The potential for new discoveries is huge. We have an enormous land package with many untested high-priority targets. We have performed a tremendous amount of work on the White Gold property including soil sampling, probe work and geophysics which has produced a number of highly prospective targets with characteristics very similar to the targets that have lead to other major discoveries in the area, and we will be drilling a number of these targets this season. These are very close to the Golden Saddle and share many of the same characteristics.
We also have many targets on our other properties in the district that have undergone similar work and are shown to have similar characteristics to those noted above and will be drilled this season as well. To name just a couple there’s the Betty target which is located along the Coffee Fault, on trend with Goldcorp’s Coffee deposit, and the JP Ross which encountered high grade drill results in last year’s program. There is another half dozen or so that we are also very excited to drill this year.
What are White Gold’s near-term exploration plans?
We currently have 5 drills turning on our properties, and plan to drill over 20,000m this year. Our program is focused 50% on expansion of our existing resource which has been shown to be open in multiple directions and 50% on generating new discoveries across our regional portfolio.
www.whitegoldcorp.ca
FULL DISCLOSURE: White Gold Corp. is a paid client of Stockhouse Publishing.