Skip Navigation Links


Bookmark and Share
Paramount Gold Nevada Corp.’s (NYSE MKT: PZG) Glen Van Treek, President, CEO and Director, Talks about Grassy Mountain High Grade Gold Project Advancing to Production

on 7/25/2017
Paramount Gold Nevada Corp. (NYSE MKT: PZG) holds a 100% interest in the Grassy Mountain Gold Project in Malheur County, Oregon, as well as a 100% interest in the Sleeper Gold Project located in Northern Nevada. The Grassy Mountain project contains a gold- silver deposit (100% located on private land) for which a PEA has been prepared and key permitting milestones accomplished. Paramount’s strategy is to create shareholder value through exploring and developing its mineral properties and to realize this value for its shareholders in three ways: by selling its assets to established producers; entering into joint ventures with producers for construction and operation; or constructing and operating mines for its own account. We learned from Glen Van Treek, President, CEO and director of Paramount Gold Nevada, that currently they are conducting a pre-feasibility study on the Grassy Mountain project. The goal is to have the mine permitted sometime in 2018 or early '19, and to start building the mine. Once they begin receiving the cash flow from the Grassy Mountain mine, they plan to advance the Sleeper project which is the bigger asset in term of total ounces.


Grassy Mountain project Nov 2016

Dr. Allen Alper: This is Dr. Allen Alper, Editor-in-Chief of Metals News, interviewing Glen Van Treek, President, CEO and Director of Paramount Gold Nevada, Corp. Could you tell our readers/investor a bit about your strategy, Paramount Gold Nevada Corp.’s strategy?

Glen Van Treek: Certainly. Thanks, Allen, for having me here. Paramount is a US based exploration company and trades on the newly named New York Stock Exchange American under the symbol PZG. We have two projects: Grassy Mountain in Oregon, and Sleeper in Nevada. We're currently executing on our strategy in advancing the Grassy Mountain project towards production. At present, we are conducting a pre-feasibility study on the project.



Our goal is to submit all of the permitting documents this year to the federal government, and next year to the state, and have the mine permitted sometime in 2018 or early 2019, at which point we plan to start building the mine. We believe building Grassy will create the most value for our shareholders. The cash flow from Grassy Mountain will give us a great platform to advance the Sleeper Gold project, located in Nevada, which is our larger asset in terms of total ounces.

Dr. Allen Alper: Could you tell us a bit more about your resources, and the Grassy Mountain project?

Glen Van Treek: Yes! In terms of measured plus indicated resources at Grassy Mountain, we have 1.65 million ounces of gold, which includes a high grade core of approximately 500,000 ounces at 5.32 grams per ton gold. That's a very nice grade.



Sleeper is a larger deposit with favorable economics. We're evaluating an open pit scenario. We have about 3.4 million ounces of measured and indicated ounces of gold plus about 2.5 million ounces of gold in the inferred category. The total for the company, including inferred material, is about 7.5 million ounces of gold plus about 45 million ounces of silver. That's our resource today.



Dr. Allen Alper: That's excellent. Very large resources, and you have one that's very high grade, and another one that's very large, and you're investigating open pit. That sounds very good. Could you tell me a little bit more about what your plans are for 2017?

Glen Van Treek: Yes, we are and have been focused on the Grassy Mountain project. It's a very interesting project, very high grade. We're in the pre-feasibility stage to develop the underground portion and started that pre-feasibility last year. We've completed the PFS drill program, which was designed to acquire material for additional metallurgical testing, geotechnical, and resource infill. We've been releasing results as we receive them from the lab and expect to receive the remaining assays in the very near future.

In the remaining part of the year, we will commence a metallurgical analysis. We plan to file the plan of operation with the federal government by mid-August. That submission will trigger the commencement of the environmental impact statement by the Bureau of Land Management. With that and after we complete the PFS in early 2018, we plan to file the application permit with the state department, the Oregon Department of Geology and Mineral Industries.



Dr. Allen Alper: That sounds excellent. Could you tell us a bit about your background, your team and your Board?

Glen Van Treek: I'm a geologist by education. I have about 30 years’ experience in mining exploration and operations. I've worked in many countries for both majors and juniors. Prior to joining Paramount six years ago, I handled research and production at a producing copper mine. When I joined Paramount we were focused on a project in Mexico that we sold to Coeur Mining for about $200 million.



Our CFO, Carlo Buffone has been with the company for about seven years. He's been instrumental in the mergers and acquisitions that we've completed over that timeframe. In 2010 we acquired X-Cal Resources and its Sleeper Gold Project. In 2015, we sold, through a merger with Coeur Mining, the San Miguel project in Mexico. Then last year, we acquired a company by the name of Calico Resources and its Grassy Mountain project. Carlo has been instrumental and was the lead on these acquisitions.

We have a great group of experienced geologists in Nevada and in Oregon that have been with us for a number of years.

To give you a broad picture of our Board of Directors, they have a very diverse set of skills amongst them which supports our strategy of building Grassy into a mine. The Board is comprised of several experienced geologists and financial professionals including the CFO of Seabridge Gold. In late 2016, we added Pierre Pelletier, an experienced environmental engineer. His experience will benefit the team with the permitting process that’s ongoing with our Grassy Mountain project in Oregon. In addition, in early 2017 we added the CEO of Seabridge Gold, Rudi Fronk, a mining engineer with over 30 years of industry experience to serve as our chairman.



Dr. Allen Alper: That's a very strong Board, a very experienced Board, and a very accomplished Board. That sounds great. Could you tell me a bit about your capital structure?

Glen Van Treek: We trade on the New York Stock Exchange American under the symbol PZG. We have approximately 17.8 million shares outstanding and 19.8 million on a fully diluted basis. We have no debt.

Our largest shareholders with combined holdings of approximately 25% are FCMI Financial, a well-known industry investor and Seabridge Gold, a successful explorer with the largest, undeveloped gold and copper resource in the world.

In February 2017, we completed a $3.6 million non-brokered private placement, with no fees or commissions paid, with primarily existing shareholders. Both FCMI and Seabridge participated.



Dr. Allen Alper: Well, it sounds like you have a very strong group of investors. That sounds great, sounds like you have a lot of financial support. Could you tell me, Glen, what are the primary reasons our readers and high-net-worth investors should consider investing in your company?

Glen Van Treek: We have two advanced-stage projects in what we consider the safest mining jurisdiction in the world. Both projects have been significantly de-risked with the completion of multiple geologic and financial assessments that show both projects are economic at present gold and silver prices.

We expect to have a permit for our high grade Grassy Mountain project in hand in late 2018 or early 2019. In the first three years of production it will cash flow approximately $50 million per year. This cash flow will allow us to proceed with a PFS at our 6 million ounce Sleeper gold project, while drilling numerous exploration targets that we have defined at both projects, without further dilution.

We believe we are undervalued relative to our peer group. We have over 8 million ounces of gold between both projects, which provides great leverage to the price of gold and with our current plan we see strong potential for our shareholders to have positive returns.



Dr. Allen Alper: That sounds excellent. Very strong reasons for our readers and high-net-worth investors to consider investing in Paramount Gold Nevada. Is there anything else you'd like to add, Glen?

Glen Van Treek: In addition to advancing our current projects, we are very excited about our exploration potential at both Grassy Mountain and Sleeper. At Grassy, we have several targets that have strong potential to find additional resources, which would add years to the mine life. At Sleeper, given our large land package, we have identified some high priority drill targets south of the historical mine pit that we believe can host gold deposits that made the original Sleeper mine famous for its mining grade and profitability.

Dr. Allen Alper: That sounds great. What would be the timing going forward to go from pre-feasibility to feasibility, and then your plans for production? Then do you have a feel for that or you wait, or you're still developing that?

Glen Van Treek: Firstly, we would move directly from Pre- Feasibility to Production as many aspects of the PFS are being conducted to feasibility levels. There's several steps that we need to accomplish along the way. One of the first steps is to file the plan of operation with the BLM, which we expect to complete in late July or early August. With that filing, the BLM will start the environmental impact statement, which will take a year to 18 months. We expect to have the federal permit in place in 2019. Once the PFS is complete in early 2018, we plan to file the permit application with the State of Oregon and expect to have that in late 2018 or early 2019.

We expect to commence construction in 2019 with first pour expected in late 2020.

Dr. Allen Alper: That's a very short time. That's great! You have a great strategy, a great property and great plans. You now have a favorable administration to help, so you should be able to get all your permits and be able to move forward.

Glen Van Treek: Yes, yes. Moreover both Nevada and Oregon have well defined permitting processes with defined timelines.

We believe it is important to note that the high grade deposit at Grassy provides us with protection against one factor outside of our control, the gold price.

By following our strategy, I think we're going to achieve our goal.

Dr. Allen Alper: That sounds good. Do you have a feel for what your costs might be in mining, how competitive you'll be as a producer?

Glen Van Treek: At Grassy, we have a preliminary economic assessment completed, that envisioned a CapEx of $120 million which we believe we could reduce by 20-30% and a cash cost per ounce of gold produced of $577. The all-in cost is $880.



When you evaluate producing companies there costs are in the range of $900 to $1,000. That figure is cash cost plus sustaining capital and does not include the initial capital. In our case, our cash cost plus sustaining capital would be in the range of $600 to $700. That's well below the average in the market right now of $900 to $1,000.



Dr. Allen Alper: That sounds excellent, that's very good. Is there anything else, Glen?

Glen Van Treek: I just want to conclude by saying that we have a committed team that is very focused on achieving our goal of advancing Grassy to production in the near term. When we think about Sleeper we don’t believe there is a better advanced stage multi-million ounce gold project that exists in Nevada.

Dr. Allen Alper: Okay, great!

http://www.paramountnevada.com/

Glen Van Treek, President, CEO and Director
Carlo Buffone, CFO
Christos Theodossiou, Director of Corporate Communications
866-481-2233




Disclaimer | Terms Of Use And Privacy Statement


© Metals News. All rights reserved.