A New Copper Player Arrives in Argentina | Centauri Minerals

0:16All right, everybody, welcome back into Mining Stock Daily. There's a new copper player from Argentina that began trading here today, and that made one of the news segments here of the morning briefing on MSD. Happy to welcome in Sam Leong, who is the CEO of Centauri Minerals. This is a spin-off, spin-out, I guess, from the Aldebaran portfolio. We first introduced this story from the PDAC floor here earlier this winter. It's been a long time coming, another financing or two, and that company is now publicly traded on the venture with the symbol CENT. Happy to welcome in Sam here for a conversation.

0:58Sam, congratulations. Huge day for you and everybody, the team involved in this spin out. We've been trading for about an hour now, I guess, hour and a half at time of recording. Widespread here between the highs and slows of where it's at. But, you know, this got to feel good to get this off the plate out to the public. Oh, hi, Trevor. Thank you. Yeah, it's been excellent. You know, exciting day. I'm very caffeinated as I started quite early this morning. But great to catch up with you since our last conversation in March. And I think our first discussion about the spin-out concept when it was unnamed still back in September at Beaver Creek almost a year ago.

1:42So I think it feels great to be able to track to the guidance that we've been giving our investors from the beginning, as well as working with the Aldebrand team to give guidance to their shareholders who've now officially become shareholders of Centauri. Yeah. Maybe let's walk us through the makeup of the structure of the company here. How many shares out, a couple of the financing, what does the capital in the bank look like right now? And then let's get into maybe some of the technical work that is expected to kind of begin launching here this winter. Yep, no problem. So where we started was that we raised 5.7 million Canadian back in October.

2:25That was the seed capital that allowed us to turn the lights on and start to separate the business and the assets within Argentina. And from there, I think the major milestone that we had was really the updating the qualifying asset, the technical report and mineral resource estimate on the flagship project, which is Rio Grande. This is a big, porphyry, gold, copper, and silver deposit, very close to Fortuna Minings, Linderro Mine in Salta, in the north of Argentina. And then from that resource, we updated an estimate, the first one since 2018, on no new drilling yet. We were able to double the estimate of contained gold, copper, and silver.

3:13So I think investors in Centauri and Aldebaran saw that and were very happy. And as we were giving guidance on what would the GoPublic route look like, we saw an opportunity to do a GoPublic financing, which was completed in July. So just this past month, which we raised$25 million at a dollar a share, which is a GoPublic price. Where that puts us from a cap structure standpoint is that we have 77 million shares outstanding with a cash position of just under 30 million Canadians. So from an enterprise value standpoint, out of the gate, D1, you know, 50 million Canadian market cap for an early, even an early mineral resource estimate that has 3 million ounces of gold, 1.8 billion pounds of copper and 30 million ounces of silver.

4:11And indicating for it is, I think, really good value and compelling for investors. Sam, so we've worked with the Aldebaran team and Regulus as well for the last couple of years. And with the spin out from the Aldebaran shareholders, can you maybe describe, is it fair to say most of those long-term investors, shareholders, specifically the institutions that have been supportive of the team, are they now supportive of you and Centauri? And then what other additions, just with a successful track record that John Black and team have had over the last number of years, what did that also bring with this go public round?

4:57Did you find some new faces, some new names? Yes, absolutely. No, I think credit. I think we talked about in detail in March in our last interview. credit to John Black, Kevin Heather, Mark Wayne, the trio who've been together for about 20 years now and well-known for the success of Antares. That was sold in 2010 and the spin-outs into Regulus and Aldebaran, which combine well over a billion dollars in market cap for those companies. And they have a unique level of trust from their long-term shareholders, you know groups like Route One out of San Francisco as well you know the corporate strategics that are in them including Self32 and St.

5:47Bono Stillwater and so I think they're unique and they're big insider holdings as well amongst themselves and the greater management team and board and so from that kind of foundation we had a lot of confidence that you know the level amount that they would distribute to their shareholders of Centauri shares would largely be held. And that was a big key point in my marketing and talking to new funds and groups who had expressed interest starting from last September in financing and supporting Centauri through multiple rounds of future financing. And so we were pleased to welcome Altius Minerals, of course, out of Newfoundland.

6:32They were a big instigator in me coming into the junior space about 10 years ago. And they've supported me in every vehicle that I've helped to build. So Altius began with a small investment in the seed round and have upped it in this public round to 5 % of Centauri. as well. There are a couple, under five major funds, well-sophisticated fund managers, fund management groups that participated in big ways here in the GoPublic route. So I think they were very pleased, I think, with the track record of the Aldebrand team and Regulus and where the genetics of this company, where it comes from, the assets themselves, why they were held for all these years, how the region in northern Argentina has continued to grow and evolve and attract attention in both mining and exploration.

7:35So that kind of puts us in a really, really strong position. Aldebaran itself continues to own just under 30 % of Centauri. so you know they've said from the beginning to the shareholders that their money and capital is committed to the Altar project in San Juan for Centauri that they're really just you know major shareholders both as an organization and personally and aligned for our success. Well Sam let's not belittle your own success in Argentina with Abra Silver and what that also brings to the table so So it's almost like a convergence of two really good track records meeting once again in Argentina, not only for Rio Grande, but a couple of those other early stage projects, which could offer some incredible blue sky potential.

8:23I'm just kind of curious, now that you are, you know, the listing is public, you're actively trading, and the real work begins. The real work on the ground is about to begin pretty heavy as we get into the seasonality down there. But maybe talk about what similarities that you kind of feel now, as maybe you did back, you know, in your last go with Abra Silver. You know, what do you think is going to be easily replicable? And what is maybe going to be something you're going to have to shift as far as, you know, is there anything you're going to have to shift, I guess, as far or be open to shifting as you regain the helms of an early stage project?

9:04Oh, that's a good question. I think first off, I should mention, I want to thank Adam Greening, who's head of corporate development for Aldebrand and Regulus. I've known Adam since he was at Yamana and I was coming out of Lundin Mining. And Adam was very much the catalyst who approached me about leading the spin out as it had been in discussions within the Aldebrand group for a number of years. and he contacted me after we had sold Aventus two years ago and said, Sam, based on your experience in Latin America building Aventus and helping build a team at Ava Silver, I don't know if you know, but you should have a closer look at this asset and we think that we can work with you on this.

9:54So Adam deserves a lot of credit for recognizing that and inviting me to really get to know the guys and earning their trust to earn this mandate. So we have Adam to thank. On Abra, the update there just more recently is that I officially stepped off the board in July after, well, seven, eight years all in, if you count Athon as well before that, kind of the merging of two companies that we instigated back in 2019. So it was a great, great ride. And I'm still very, very close. Some of my closest friends and colleagues I've ever had are involved with ABRA. So I'm still there and we're neighbors now.

10:36But I made the decision largely because I knew that as Centauri got up and running in public, that there could be more conflicts or the very least perceived conflicts. And I wanted my undivided attention on Centauri. To your question about comparisons, I think that is kind of what I saw from the beginning, personally, with my experience, the parallels in how we assessed the Diablos project that Abra Plata had at a time in 2019 when we identified it as a merger candidate, and how some of these assets that seem to have a historical legacy wrap of being uneconomic or too low-grade or too challenging in a jurisdiction with uncertainty, that if you kind of go in with a new lens and focus on gaps that maybe you can address, there's a unique opportunity to unlock value and demonstrate results instead of just planning for hope.

11:41So I think that's how ABRA started. We were in 2019. I remind people that we were at 10 million Canadian market cap, two companies that were desperate coming together. Obviously, the market and the backdrop in Argentina has improved significantly since then. But Centauri starting with a 50 million enterprise value Canadian, but with a much bigger deposit in Rio Grande and a whole portfolio of six projects versus just one and almost four times as much mineral concession area, I think is a tremendous start with a lot of parallels. Yeah. Okay, let's talk about the work at hand. You did mention in an email sent out to shareholders last week about putting drills on the ground there at Rio Grande in Q4.

12:34So it's obviously a major drill program. This is following that resource, mineral resource that was published earlier this one. I think it was late in the spring or early summer. I'm pretty sure we spoke with John Black about that once it was published. if my mind doesn't play tricks on me right now. But maybe talk about what is at store here for Rio Grande with the resource. What is maybe the strategic approach here this season with Rio Grande and the drill program? Yeah, with Rio Grande, you know, we've been busy at work. I think we put out the mineral resource estimate and 43-101 report in March, April of this year.

13:15So we announced it at PDAC and then filed it about a month later. So that is available on CDAR for all investors. And that was good work done by SLR, formerly Roscoe Postal Associates. On the kind of foundation of that estimate, our key findings as a team were that, okay, There's a lot of review work that we need to refresh and understand as a team. There is a lot of geophysics and new tools really in a 15-year era span that has changed and evolved. And I think the modern set of tools in geophysics has demonstrated and led to new discoveries, not just in Argentina, but across South America. So that was a toolkit that we wanted to obtain and execute on, which we've done in terms of the field program in August of this year, so this month.

14:19And we're crunching those numbers right now, the new data sets and iterating with very experienced consultants on interpretations. Geophysics is never a guarantee. It's still an art with the science of it. And it continues to evolve. And like all models, all models are wrong. And it's down to the users to interpret, right? And the experience to interpret it. So we are spending that time now. In parallel, we've also done a metallurgic review. Being a bad metallurgist in my early career, I'm still connected to better metallurgists that I've worked with from Hatch and Lundin and Aventus. And so I have a couple of former colleagues who are independent now who've been helping me do a review of historical work, which is very limited.

15:11If you look at the recovery and testing of Rio Grande, it's very limited. So that's a huge kind of another path of work that we've been working on to kind of make sure that we've got those bases covered. what does new samples, new areas, higher grade potential look like from drill targeting standpoint. So we're getting clues from the metallurgic overview as well. What does that all mean? Well, it really comes down to drill targets and giving us a higher probability chance of success in drilling better holes, better intercepts. And what we've been doing the past couple weeks here is having our final decisions on the drilling contractors that will begin work.

16:00We're guiding Q4. I always try to get things going ahead of guidance, as you know. So we're looking to mobilize them in October here, start drilling with one rig in October, ramping up to two. And that will begin a, hopefully, a steady cycle of new flow and results to shareholders. Sam, I think it's fair to say, and you can disagree with me if you want or if you feel the need to, but I think one of the biggest takeaways from my site visit at Altar that I took from the team is, if you look at one data point, the amount of meters drilled per ounce in the ground is very incredible. And you could talk about completely de-risking the geology of projects as that team are thorough drillers.

16:53They want to do precise definition. And so if you look at that aspect of, you know, meters per ounce, it's very high compared to a lot of piers with similar, you know, similar scope and scale to it. But using that, I mean, what are some of those key exploration data points that maybe the Regulus and Aldebaran team have implemented over the years that are really going to be transferable to Rio Grande and the other projects? I mean, that's just one data point. But what have you learned from them that's like, man, to be the next one on the block, this is what we need to do? yeah that's a really good question um and and it makes me well i think maybe a healthy amount of uh of of nervousness because they set a high standard they know they set a very high standards standards are very very high yes it's like coming into new in-laws and it's kind of like oh god what i get myself into that's that's right that's right exactly so so that that's a good analogy And it's like I've married into the family and the intimidating, you know, parents in law are Kevin, Heather and John Black from from an exploration standpoint.

18:10And, you know, they, you know, they're Kevin and John are in particular are such joys to work with. Hard to believe we've only been working together for a year now. But, you know, they they are meticulous, number one. And they're also endlessly curious. They're always learning and changing with the times. And they love it. All those things. So if you look at the evolution of what they did at Akira for Antares, historically at Rio Grande to what they've now done at Antakori, continue to do Antakori, and Altar for Aldebaran, they've continuously implemented new and better tools as they've evaluated.

18:56them. And so I think for us, it's a, you know, we can't do everything that they're currently doing at those projects because in many ways, there's a lot of dust on Rio Grande. It's been so long since anyone's worked on Rio Grande as well as the other projects. I think we have to start, you know, in a smaller, more efficient way, kind of, you know, gleaning the best lessons that they have and putting it to work as a start and then to ramp up accordingly based on iterative results. So, for example, if David was on this call, he would tell you that for the longest time, he was never convinced of geophysics, that he kind of looked at as a bit more kind of voodoo science than actual targeting tools.

19:43But it was that evaluation and new thinking on, you know, MT and IP programs at Altar that's led to some of that, you know, real efficient drilling and discovery that you know of and many investors do as well. And we've used the same group, put them to work here on that first program at Rio Grande. And that group will continue on to Aguascalientes, our Centauri second project in September. So that will kind of, you know, while we have them in the north, we're going to continue the second part of the work with them on the second project. So that's how we're going to start. My hope is that, you know, the iterations will go well.

20:25You know, it supports the truth machine, which is always the drill rig. The drill rig is going up there. And then from there, you know, Kevin, John, and our advisors will continue to help us. We'll have a keen eye to see what results we get and help us generate ideas as well. Okay. And my last question, I want to try to keep as succinct as possible, but it is kind of a bigger question. I'm not quite sure how to appropriately frame it, but it really comes down to not just the management team behind Aldebaran and Regulus. So we've, you know, talking about John and Adam and Mr. Heather, all, you know, all those, all those, but really with that team comes an incredible, very tight knit technical team that have worked together.

21:16within that group for a number of years now. And I know it's hard to imagine them taking on a third company, a third big project at the moment with both Antiquori and Altar, you know, the market kind of expecting some sort of move from one or either of those projects here. But can you talk about, will some of that team be working with Centauri Or is it maybe an expectation that once time is freed up from either side, that maybe those individuals would be coming in helping Centauri? Can you kind of walk us through that dynamic, the timing of it all? And really, you know, there's a lot of things to be juggling right now.

22:02That's a very good question. And I think it harks back to our discussions, you know, start of September and then also in March. No, for sure. Their team is unique in how long they've been together and how effective and efficient they are managing two companies and two mega projects that are rare in our space without the big empires of big majors and big exploration departments. And so, from the beginning, I've been very cognizant. It was one of the driving motivators of me coming in here to lead Centauri and to build a separate team that would take on a new set of day jobs, but with support of the guys who already have two jobs.

22:49So I think I mentioned Kevin and John being involved as advisors. A key person who has been integral to helping Centauri, helping me build the team has been Javier Roberto, who's their country manager and a geologist who has a continuity on all of Centauri's projects. Javier has lived in Salta for a very long time and that continues to be his base. and he's a very well-known, well-respected professional in Argentina. So my request from the beginning was that he would be on the board of Centauri and he continues to be, so he's there. But as we go public here day one, we've already been discussing additional additions to our exploration team in particular as we spread from Rio Grande to Aguascalientes and then look to re-energize sampling work in the rest of the portfolio.

23:50So Dario Gonzalez and Ignacio Butler are two key guys in Salta. These are our exploration manager and our country manager, you know, who are there, very experienced, also growing in profile and growing our company's profile within Argentina. But we will need more help. So we are definitely hiring more, you know, more geologists, especially, you know, younger ones who are hungry to get in the field here in the north with us. Very cool. All right. Sam, again, congratulations. Huge day on getting it to this point, but there's a lot of work to be done here and we'll be following the story in the weeks and months to come.

24:32Probably be seeing you on the road as conference season begins to really kick off as well into the fall. So I look forward to those future conversations and look forward to being a shareholder of Centauri as well, as I did participate in earlier financing this, or late last year, I think it was. So about a year ago. Oh, thank you, Trevor. Always a pleasure to speak with you. And now I invite your listeners to have a closer look at us and contact me with any questions. We're traded under the symbol CENT on the TSX Venture and expect news on an OTC or a listing in the U.S. in the weeks and months ahead here.

25:13Very good. All right, Sam, have yourself a great week ahead. Thank you so much.

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