It’s great to speak with you again Graeme. Can you tell us what’s been keeping you busy since we last spoke in February? (TSX: V.BHS, Stock Forum)
Since we last spoke, we have spent a significant amount of time interpreting all the historic Bayhorse mine data, and making up to date schematics to see exactly what has happened over the years. American Mining and Tunneling, has been contracted to fix the Bayhorse Mine adit, and work is under way. We have also started a marijuana business initiative by engaging two consultants who are very experienced in the field to assist us in reviewing business opportunities in this new and exciting area.
What prompted the decision to pursue the marijuana band wagon and are you shifting your focus from mining to growing?
We are not shifting away from mining. Far from it. Mining and near term cash flow will remain as our main focus however, there is significant market support for marijuana initiatives. The same group that brought us our recent Bayhorse Silver Mine have introduced us to two consultants with vast experience in this new industry. The consultants have provided us with expert advice thus far and presented some great opportunities in both Canada and the US, especially in Washington State where they have already developed successful operations.
One thing our shareholders are probably not aware of, is that in an earlier life I was a Municipal inspector, and for many years dealt with many of the issues that surrounded the marijuana grow ops, so as the CEO of Bayhorse, I have a perspective and experience in this field that will be of assistance with our entry into this new and exciting market.
How does this decision benefit your shareholders?
We believe it will substantially benefit our shareholders through higher share prices. The one major issue that all shareholders are faced with is stagnant share prices in this still most difficult of exploration and mining markets. Funding has been hard to achieve in this sector over the past three years so if we can provide our shareholders with a greater potential for market gains, and the ability to fund without significant dilution, we would be remiss if we did not look at this opportunity.
The legalization of marijuana and the business opportunities that have been created provides us an opportunity to help diversify our business by adding value, and balancing the boom and bust cycles we have been faced with over the years.
Additionally, we have made it a practice of providing our shareholders with participation on new companies through spin offs from Bayhorse. This will also provide us with another opportunity to do this with the marijuana business, which we believe has significant growth potential.
What are your plans then for the Bayhorse Silver Mine in Oregon?
Our mining contractor expects the adit safety program to be completed by the end of April, 2014. Our next goal is to confirm the historic high grade resource through comprehensive underground mapping and sampling program. By early May we anticipate preparing for a bulk sample of up to 5,000 cu/yds (15,000 tons) for full metallurgical testing that we should be able to complete this year. If the sample grade is similar to the historic average of 15 ounces of silver a ton mined in 1984, processing this sample could see as much as 225,000 ounces of silver and a potential significant return to our treasury to offset our exploration costs.
What about your gold properties in New Zealand?
Dr. G. E. Ray, P.Geol., completed a NI-43-101-Report on Alexander River last year, and is currently preparing a NI-43-101-Report on the Red Queen project. We have coarse gold at both Alexander River, as well as at Red Queen, so we will be shipping some of the drill core from Alexander, and other high grade Red Queen samples to a specialized lab in Quebec, for more accurate assaying than the standard 30g samples normally assayed. We expect to undertake a drilling program on Alexander River later on this year.
How will the company fund your exploration and construction work and the new marijuana start up?
Exploration and construction money is always a big issue, for all companies. We expect current warrant and options holders will exercise warrants and options that should bring significant funds into the Company. We also expect that any rise in our share prices through the recent announcements will assist us in raising any needed funds, and we are budgeting these amounts right now.
What can shareholders and new investors expect to see from Bayhorse in the next 12 months?
Our shareholders can expect to see lots of news as we press forward with our initiatives. We anticipate strong results from our Bayhorse sampling programs, and potential cash flow from both the Bayhorse mine and our Flagstaff barite net profit interest, and of course lots of news from the marijuana business program initiatives.
Why is Bayhorse a good investment opportunity?
We expect to achieve cash flow from our 30% net profit interest in the Flagstaff barite mine to kick in this year, as well as cash flow from our bulk sample initiative from the Bayhorse mine. We have a very small float compared to some companies, currently only 19 million shares fully diluted and management has a lot vested in the business. I personally hold approximately 15% of the Company. We have a demonstrated program of providing our shareholders with share dividends by way of Plans of Arrangement. We have completed two of these already, Silcom Systems and Archean Star Resources, and we expect to do one more this year. We believe the initiatives we have undertaken make Bayhorse a good investment opportunity.
Bayhorse Silver Inc, President & CEO, Graeme O’Neill established the Company and has been President & CEO since its inception. He has been involved in managing junior exploration companies in the minerals sector for a number of years and is experienced in logistics, planning, and operations development. He has a strong background in the regulatory and compliance requirements of public companies.
Disclosure: Bayhorse Silver Inc. is a Stockhouse client.