Can you describe your company and say what it does?
Maudore Minerals Ltd (TSX: V.MAO, Stock Forum) is a gold exploration company operating in Quebec, developing the Comtois gold property and conducting initial work on a large land package to the west with potential for volocanogenic massive sulphide (VMS) mineralization. Quebec is famous for VMS deposits – combined gold, silver, copper, and lead/zinc – which can be very large and economically robust mining operations. Quebec’s Abitibi Greenstone belt, is second only to South Africa for historical gold production, worldwide. The greatest difference is that while South Africa seems to be more or less played out, there still seems to a lot of gold and VMS deposits still being discovered and developed in Quebec.
What distinguishes your company from others in your space?
GRADE! The average open pit gold project currently in development has a grade of about 1 g/t Au. Maudore’s potential open pit shows a grade of 3.2 g/t Au – over three times as high as the average. We also have an underground resource currently grading 6.8 g/t Au. Within the open pit and underground resources, we continue to encounter spectacularly high grades: 30, 40, 100, and over 450 g/t Au intercepts.
Can you explain why you have chosen to work in Quebec?
There are so many great reasons to work in Quebec I hardly know where to start. First, as I already mentioned, is the historic and current gold production in the province, and the excellent exploration potential. Our main project area, the Comtois, is located on a highway, locally serviced by well-maintained logging roads, has access to North America’s lowest-cost electric power (the James Bay hydro line has an underutilized substation within five kilometres), and is proximate to a local workforce that is highly skilled in both open pit and underground mining. Quebec was named by the Fraser Institute as one of the three best locations in the world for mineral exploration for several years running, for many of these reasons, and also for the province’s simplified permit application processes. I’ll add another very significant benefit unique to Quebec, which is a yearly cash rebate of 47% of non-flow-through exploration expenditures, enabling Maudore to aggressively explore on a highly cost-effective basis.
What are your flagship projects?
The Comtois Project is our flagship. It has a strike length of over 1.5 kilometres, encompassing four deposit zones that are being successfully linked together by current exploration efforts. An August 2010, resource estimate provided over 1.2 million ounces divided into a potential open pit grading 3.2 g/t and an underground portion grading 6.8 g/t. The cut-off date for the estimate’s data was February 15, 2010, and we’ve had four drilling rigs working continuously since, so that 1.2 million ounce number has definitely been substantially increased, and continues to increase.
But we also hold a very large land package, over 85,000 hectares, or 330 square miles (larger than New York City), lying mostly west of Comtois, which we’ve been acquiring through staking since 2007. This second land package was identified by the Quebec Geological Survey as having very good potential for volcanogenic massive sulphide, or VMS deposits. Quebec is famous for VMS deposits…Aginco-Eagle’s LaRonde VMS Mine is among the most profitable in the world because base metal profits often pay for all of the costs associated with gold production. Back to Maudore, we’ve been busy qualifying targets on our VMS land package and some drilling is going on there this winter. A second discovery would obviously add terrific value to Maudore.
What are the main challenges that you face in operating your business?
Prioritization; I think our main challenge is in deciding how to allocate our personnel and our drilling rigs. With so much ground with great possibilities, including the open-ended nature of the Comtois project’s strike, we have to decide how to explore and develop as many of our prospects as possible while continuing to build Comtois into viability.
Who are your competitors?
Well, in a broad sense, every junior mining company on the planet is competing for attention from potential shareholders. In Quebec alone, well over 100 companies are currently conducting mineral exploration of all sorts, but most don’t have the sort of infrastructure present at Comtois.
Who are the major shareholders of Maudore Minerals?
Ron Shorr, President and CEO, is the largest individual shareholder with about 7% of issued and outstanding shares. Other management members also hold significant stakes. This shows a commitment to the shareholders. Other large shareholders include royalty companies, institutions, family trusts and other sophisticated shareholders, several of which have financed Maudore several times, each time at higher prices. About 25% of our shares can be considered to be in the public floats.
How much cash to you have on hand and what is your monthly cash burn rate?
We have about $10 million cash on hand. Our burn rate is somewhat higher during the winter months, when we can access all areas of our property package, and is currently running around $1m a month. The main areas of the Comtois Project can be worked year-round, so we don’t slow down in what might be the off-season for many companies, so we will continue to explore at a high pace throughout the year. I want to mention that Quebec will be providing our 2010 exploration rebate later this year, so our cash position will be enhanced by an infusion of about $4 million without any share dilution. Also, we recently raised over $11 million at $8.00 a share, further minimizing dilution. Maudore has fewer than 27 million shares, fully diluted.
Who are the key players on your management team?
I served as President, CEO and Chairman of the Board from 2004 to 2010. We made room for growth at the corporate level when I stepped down as President last year – I’m still CEO and Board Chair. We recently appointed Kevin Weston as Executive Vice President and Chief Operating Officer. Kevin has great depth of experience in taking mining projects from our current level of development all the way through to production, and I think he’s key to our forward motion in 2011 and beyond.
What kind of experience do they bring to the table?
Aside from Kevin Weston, our new COO, Maudore’s Board of Directors is a very experienced team of technical and financial mining professionals, all with a strong track record of building and developing companies in our sector.
Disclosure: Maudore Minerals is a Stockhouse client