Thank you for your interest in West Red Lake Gold Mines.
I know that you are busy and bandwidth is squeezed, so let’s cut to the chase.
Our flagship Ontario asset – The Madsen Gold Mine – is debt free, fully permitted, and has a brand new 800+ tonne per day mill, a tailings and water treatment facility.
The “lower-grade” near surface zone is about 3.5 grams/tonne gold, the higher-grade zone at 500 meters averages 9 grams/tonne gold.
At its peak, the asset was valued at over a billion dollars, 10X our current market cap. There is smart money heavily invested in the current project – Frank Guistra (10%); Sprott Resource (24%).
The previous operator was under-capitalised. Debt repayment obligations forced the company into a quick-to-cash-flow mine model that was ultimately expensive and inefficient.
I have designed, built and operated mines (open pit and underground) in Greece, Turkey and Canada – for Skeena Resources, Eldorado Gold and Rio Tinto. Under Frank Guistra’s guidance, my team conducted three months intense due-diligence on this project. It is clear to me and our technical team, the problems with this mine had to do with management strategies, not the asset itself.
Geologically, metallurgically, politically and environmentally we are not aware of any big negatives with this mine.
We purchased this asset for pennies on the dollar when nobody cared about gold. Investors are starting to care now. With global debt levels reaching $305 trillion, we anticipate the gold price reaching new highs.
The Red Lake District is one of the most prolific gold districts on the planet with over 30 million ounces produced. Our 47 Km2 land package is 13X bigger than NYC’s Central Park.
Next week in Part 2 of my message to shareholders,
I will explain how the previous operators got it wrong, and how we are getting it right.
Sincerely,
Shane Williams
Chief Executive Officer of WRLG
Thank you for your interest in West Red Lake Gold Mines (WRLG.V). This is Part 2 of seven messages I am sending to WRLG shareholders to share my insights about the project and to state clearly our business objectives.
Our flagship Ontario asset, The Madsen Gold Mine, was once valued at $1 billion. In the spring of 2023 we acquired it for $6.5 million cash, 28.5 million shares, while granting the seller a 1% Net Smelter Royalty.
I am often asked: “How is it possible to purchase a fully permitted gold mine with a new 800+ tonne per day mill so cheaply?” There is a simple answer: when the mine was briefly in production it was “sub-economic” – which is a fancy way of saying, “It didn’t make money”. That put off a lot of potential buyers.
After three months’ due diligence we discovered that the problems with the mine were caused by a compounding series of financial and operational decisions, not the mineral asset itself.
The previous operators took on debt with repayment terms that forced them into an early production date with the lowest capex possible. This meant neglecting delineation drilling, leasing equipment that should’ve been purchased, and targeting a close-to-surface lower grade zone.
Covid protocols also created a headwind for the previous operator.
My technical team has reviewed every available financial, engineering, geological and metallurgical document relating to the Madsen project.
We have made a decision to optimize this mine before restarting production. This will involve infill and expansion drilling, underground development, engineering studies and a PEA.
To put it bluntly, the rich 9 gram/tonne gold starts 500 meters below the surface. We are determining the best way to get down there, extract and process the gold for maximum long-term profit.
Next week in Part 3 of my message to shareholders,
I will talk about the existing infrastructure at Madsen, including the modern fully permitted $100 million mill.
Sincerely,
Shane Williams
Chief Executive Officer of WRLG
The West Red Lake Gold Mines’ situation is a bit different. We inherited a modern, fully permitted, virtually-unused mining facility which includes underground equipment, double ramp access, a 1,273-metre-deep shaft, expandable 800+ tonne per day mill, excess tailings capacity and a water treatment plant1.
The mill achieves 95% gold recovery2. The tailings pond and water treatment are regularly inspected and pass with flying colours. Last month I was on site with the Ontario Minister of Mines – a former executive at Placer Dome. He is very supportive of the project.
It’s difficult to put an exact price tag (value) on the existing infrastructure. The mill itself cost approximately $100 million. With rampant inflation in construction, the replacement cost would be significantly higher. But the biggest benefit of the permitted existing infrastructure is the effect on production timelines.
The permitting process can take ten years.
We have challenges to overcome, but in my opinion, the modern, debt-free, permitted infrastructure has significantly de-risked this project.
Next week in Part 4 of my message to shareholders,
I will tell you about the resource expansion potential at Madsen.
Sincerely,
Shane Williams
Chief Executive Officer of WRLG
Thank you for your interest in West Red Lake Gold Mines (WRLG.V). This is the Part 4 of seven messages I am sending to WRLG shareholders. Today I want to discuss the expansion potential at our Madsen property in the Red Lake district of Ontario.
The Madsen land package is 47 km2. That’s 11X bigger than Vancouver’s Stanley Park. With a property this size, and the previous operator’s focus on production infrastructure, the exploration potential at Madsen remains largely unrealized.
According to an updated 43-101, the main Madsen deposit has 6.91 million tonnes averaging 7.4 grams/tonne gold for 1.65 million ounces of indicated gold and another 366,200 inferred ounces @ 6.3 grams/tonne gold. [1]
For instance, we have just begun a 3,000-meter drill program at the Wedge Target, located about two kilometres from the Madsen Mine. Wedge sits next to the Starratt-Olsen Mine which historically produced 163,000 oz of gold.
Wedge already has an Indicated mineral resource of 313,700 ounces @5.6 grams per tonne gold. [1]
Wedge has an additional Inferred resource of 431,100 oz grading 5.7 g/tonne gold. The September, 2023 drill program is intended to expand and upgrade the mineral resource at Wedge.
We have numerous other gold-rich satellite targets around the Madsen Mine, including Russet which has 88,700 indicated tonnes @ 6.9 g/tonne gold, and Fork which has 123,000 indicated tonnes @ 5.3 g/tonne. [1]
We anticipate these satellite deposits will feed the existing Madsen mill, increasing IRR (Internal Rate of Return) and LOM (Life-of-Mine).
Next week in Part 5 of my message to shareholders,
I will talk about The Rowan Gold Project.
Sincerely,
Shane Williams
Chief Executive Officer of WRLG
Our flagship asset – The Madsen Gold Mine – is debt free, fully permitted, with a brand-new 800+ tonne per day mill, a tailings and water treatment facility. [1]
The Rowan Gold Project is 15 kilometers as the crow flies from the Madsen mill. We believe there are synergies between the high-grade resources at Rowan and the Madsen mill.
On September 12, 2023 we published Rowan drill results including an intersection of 8.3 meters @ 70.80 g/t Au and 0.5 meters @ 1,120.19 g/t Au. [2]
In the mining industry it is rare to have size and grade working in your favor, but at Rowan we are seeing both.
Current drilling at Rowan has only tested the gold-grade down to a depth of approximately 550 meters. The high-grade zones remain open below this vertical depth. The Red Lake Mining District is known to host ore bodies that extend down to +4 kilometre (km) depth, so there is upside in the down-plunge.
The Rowan project has 800,000 ounces of gold already defined as a resource. Sometimes, that’s enough to start a mine. But we are treating it as an exploration stage project. From what we can see, it’s a typical Red Lake system. As we drill deeper into the system, we’re getting higher grades.
Our geological team’s confidence in this asset is growing. We believe it is a viable potential future source of high-grade mill-feed for Madsen. The material from Rowan could be trucked around the lake or across an ice-road in the winter.
Next week in Part 6 of my message to shareholders,
I will introduce you to our Superstar Team.
Sincerely,
Shane Williams
Chief Executive Officer of WRLG
Our flagship asset – The Madsen Gold Mine – was identified and targeted for acquisition by Canadian philanthropist and financier Frank Giustra.
Mr. Giustra formed Wheaton River Minerals which was sold to Newmont for USD $10 billion in 2019. He has a track record of unlocking value in prime gold assets.
Under Giustra’s guidance, The Madsen Gold project was purchased six months ago for $6.5 million cash, 28.5 million shares, while granting the seller a 1% Net Smelter Royalty. The mine is currently debt free, fully permitted, with a brand-new 800+ tonne per day mill, a tailings and water treatment facility.[1]
Our V.P of Exploration, Mr. Will Robinson is a precious-metals veteran who was most recently Exploration Manager at Coeur Mining where he evaluated new opportunities and provided technical support to the mine-development teams.
Executive Chairman, Mr. Tom Meredith served as the previous CEO of West Red Lake Gold. He was the President & CEO of Lexam VG Gold from 1995 to 2011, spearheading four gold projects in Timmins, Ontario.
Director, Tony Makuch was CEO of Kirkland Lake Gold driving production from 300,000 ounces to 1.4 million ounces/year, leading to Kirkland’s 2022 merger with Agnico Eagle Mines Limited.
Our VP of Corporate Development Amandip Singh is a former sell-side analyst with a degree in geology. He was part of the management group that developed the Saddle North Cu-Au porphyry project, which sold to Newmont Mining for USD $311 million. [2]
I have designed, built and operated mines (open pit and underground) in Greece, Turkey and Canada – for Skeena Resources, Eldorado Gold and Rio Tinto.
You may be noticing a trend here: the WRLG team is strategically assembled to achieve one collective goal: create a profitable gold mine in the West Red Lake district.
Next week in Part 7 of my message to shareholders,
I will talk about market timing and the demand drivers for gold.
Sincerely,
Shane Williams
Chief Executive Officer of WRLG
Thank you for your interest in West Red Lake Gold Mines (WRLG.V).
This is part 7 – the final installment of seven messages to WRLG shareholders.
Today I want to talk about market timing and the demand drivers for gold.
The value of gold is buried deep in our ancestral psyches. Archeologists have discovered shaved flakes of bullion in Paleolithic caves dating back to 40,000 B.C.[1]. The Chinese love gold. India’s population treats it as a religion [2]. It’s an asset class that is not going away.
At USD $1,950/ounce gold is flirting with all time highs in many foreign currencies including that of
We are confident our plans for the Madsen project will demonstrate robust economics at current and lower gold prices.
Our founder Frank Giustra has a track of buying gold assets for pennies-on-the dollar, building metal inventories and putting mines into production, creating massive leverage to the gold price.
Fiat currency (cash) is losing value because central governments have printed too much money. Total global debt is now $307 trillion [4]. On average, every man, woman and child on the planet owes $38,000. There is no financial model – even scrawled on a napkin – that explains how that money will be repaid [5].
I have a family, I buy groceries. Like everyone else, I feel inflation on a daily basis. The cash in my wallet is getting weaker. What central banks call “a structural mismatch between revenues and spending” is a fancy way of saying they are insolvent and have no choice but to print more money [6].
As Giustra recently said, “Never listen to what a central bank has to say. Watch what they do. They’re loading up on gold because they are anticipating a monetary system reset.”
No-one is sure exactly what that reset will look like. But owning a stake in West Red Lake Gold Mines will be one way to protect and grow wealth.
We will continue to update the market with drill results and the progress of our mine development program.
Sincerely,
Shane Williams
Chief Executive Officer of WRLG
