Liberty Gold: Building Idaho's Next Major Gold Mine

0:16Trevor Hall: All right, everybody, welcome back into Mining Stock Daily, wrapping up our first day here in Zurich at the Precious Metals Summit. I've been looking forward to this conversation with Liberty Gold. They do trade on the TSX with LGD and on the OTCQX with LGDTF. A continuing, compelling story here with Liberty Gold. They did publish some new technical report, obviously, and I think there's a lot of market expectations for this company and the Black Pine Project. Happy to welcome in Tyler Cole, Vice President of Project Development. Did I get that right? Yes, that's correct. Thanks, Trevor. Great to be here.

0:59Trevor Hall: Yeah, good to have you on. You're just stepping into the shoes doing the conference tour? Yes. Is somebody sick?

1:10You volunteered to do? I was voluntold, but I'm happy to be here. It's a pleasure to come. This is my first time in Switzerland. Oh, cool. And this is a fantastic conference, so yeah, happy to be here.

1:21Trevor Hall: All right. Well, there was a lot of people in the room this morning. I did chair the session when you did the presentation. But let's talk about that feasibility study for Black Pine. 60 % IRR using a$32.50 gold price. What's the number in that study? There's a loaded question. What's the number in that study that actually worries you the most? Because that thing was very... Yeah, look, I mean, the feasibility study, we put a lot of work into it. We took the lens that we weren't going to package this up for sale. Our goal here is to build this mine. And so we made sure that when we made a decision in the feasibility study, we knew we were going to have to live with this for the next maybe 20 or even 30 years.

2:11And so we were very deliberate when we selected every choice we made. So the number I would say that I am a little bit concerned about is our initial capital stamp. Not because the data isn't good. We actually have very good data, and we've already started to secure some of our long-lead items. And thus far, we've been under budget. it. But the reason why I'm a little bit concerned is just because of inflation and tariffs, two sort of unknowns. And so as we work through it, that's what might catch us out. We've done what we could to adjust for inflation, but we still don't know where that'll land in the next couple of years as we build this.

2:58Trevor Hall: Okay. The$411 million, was that the CapEx? Yes, that's the initial capital. And you would ideally probably raise more than that just to have some padding, yeah? Yeah, absolutely. So we will need, in addition to that, some working capital as we ramp up to full commercial production. And so we don't have an exact number yet, but we will raise a little bit more than that 411 to make sure we have a buffer to cover any unforeseen cost overruns and to cover things like inflation. And if we are unable to source some of the stuff within the U.S., we will be subject to those tariffs. You kind of talked about this in your presentation about what a potential financing package would look like.

3:49Trevor Hall: Debt markets look pretty favorable right now because of paybacks so well, especially with a project like Black Pine. It looks very favorable. So you also want to watch your dilution. What would be the most ideal situation for Liberty right now? Yeah, so we view it as having sort of three sensible options for financing this project. You mentioned debt, and equity is another option, and we do have the ability to put a stream on it. Currently, Black Pine only has a half a percent royalty on the property, and we actually have the right to buy back half of that half. And so our financial model assumes that we've deployed that capital, buy back that quarter percent and it carries a quarter percent royalty throughout the mine life.

4:34So it does have the capacity to put on another small stream of royalty without having too much of a negative impact to the financials. As you mentioned, this asset has a very short payback period and it generates a tremendous amount of free cash flow very early in the mine life. And because of that, this asset does have the capacity to take on quite a lot of debt. And so we believe where we'll land is likely the lion's share of the project financing will come from debt financing, with either one or two of the other two options making up the difference.

5:10Trevor Hall: Okay. Let's talk about a few of the technicals. And the one that really got my attention when that feasibility was published was the recovery. This is a run of mine. I think that there were in general the entire project showed about 70 % average recovery but was it range front that run a mine was 90 % or not if not better yeah crushing does nothing yeah our recovery curve as it relates to particle size is almost horizontal yeah it's very very flat and so we've we've looked at a a number of options that would involve crushing in it and there's just no economic justification. As you mentioned, our recently published results from our bulk column tests, which is run at run of mine size, our range front deposit came back above 90%.

5:59And what's even more interesting is 80 % of that recoverable gold came out in the first 10 days. So that is lightning fast leech kinetics.

6:07Trevor Hall: Is there any other comparable project that leeches that fast? I've never come across one. I remember at another conference, we overheard a conversation where the company was very excited because they got 80 % of their recoverable gold in the first 35 days, which is fast. That is very worth getting excited about, but 10 days is, we've never seen anything like that. It's like a cheat code. You know, it's like up, up, down, down, A, B, A, B, start, and then 10 days you have 80 % gold. A lot of gold. Isn't that amazing? Yeah, absolutely. Those numbers really were jaw-dropping. But is there upside?

6:44Trevor Hall: I mean, obviously the range front has 90%, but for the other part of where you're doing these recoverable tests work, I think 70 % is kind of... Yeah, the weighted average across the property is 70.2. Okay. And yeah, there's definitely some opportunity to improve upon that. We think we have used a relatively conservative approach when building our recovery equations. and we've validated our recoveries through extensive metallurgical test work. We've run over a thousand extraction tests, many of which are column tests. Some of them are the traditional sort of five-foot tall, four-inch diameter or a couple-inch diameter columns and then all the way up to those four-foot, 20-foot tall bulk columns.

7:31We've done a lot of extensive metallurgical test work. We think where the real opportunity lies is in the conservatism that we've used in classifying our ore types. We have identified a few different ore types, MET 1, 2, 3, 4, and POC. MET 4 and POC are waste. It doesn't matter the grade that they contain, we waste them because of the potential for preg robbing. MET 1 is our rocket fuel. That is the clean stuff. You put it right on the pad and you get the gold right away. Met 2, we believe, is right now we're treating it as special ore. So the way we handle it on the leach pad is we will put it only on the final outside edge of the pad so that no ore will ever be stacked on top of it.

8:22Once we get into operation, there is a very high likelihood that that will transition to Met 1. and our Met 3 product, which we stockpile until the end of the mine life, and we put a thin layer of it at the top of our leach pad. So again, no ore will ever be stacked on top of that. We believe that we'll have an opportunity to treat that more like the Met 2 and put that on the outside perimeter. And so that's where the opportunity lies to increase that recovery.

8:48Trevor Hall: Okay. I do want to talk to you about Rangefront because it's open to the north. You're doing some drilling yet. You've got targeting 25 to 35 million tons of inferred material to upgrade. Yeah, absolutely. And so we are data constrained at the surface. So when we were exploring it, we sort of took that wagon wheel approach where we'd build a drill pad and we'd send several drill holes down. So we have great data at depth, but at surface it creates some gaps. And so one of the focuses of the drill program this year was some resource conversion. And so we've put a lot more surface holes in that range front deposit.

9:26And as we get that information back, we will update the resource model. We'll release a new mineral resource estimate in the first half of next year that will incorporate all the drill results from 2026. In addition to that program, we actually did some step-out drilling to that north end of the pit. And we are seeing very encouraging results. We published those results recently and we are expecting some at least modest resource growth coming from that drilling program.

9:56Trevor Hall: Resource growth at this stage improves mine life, is that fair to say? Yeah, absolutely. So it'll help smooth our production profile and extend the mine life. Any chance it maybe tweaks the early years of blackbind? So right now, in the early years of mining, we focus on our discovery pit. And that's just because the really nice grade is very close to surface. It doesn't have the same leach kinetics as the rangefront deposit, but it's still very, very fast. And so that's where the mine plan focuses on in the early years. However, if we do get some sort of very favorable results from that rangefront deposit, we may be able to pull that forward even further.

10:41We did pull it forward from the PFS to FS by a couple of years. but that is our sort of cleanest ore and it's right next to our leach pad so we will continue to evaluate opportunities to pull that further forward.

10:56Trevor Hall: Okay talk about management team Curtis Cadwell's general manager Craig Doudre is on the board as you kind of move into this next moment for Black Pine and for Liberty Gold, where is the personnel kind of holes you need to fill to continue the process to get to a final investment decision? Yeah, absolutely. So as you mentioned, we just recently appointed our site general manager. So this is Curtis Cadwell. He's got about 30 years of mining experience. He's been the general manager of several operations, many of which are very comparable to Black Pine and so we're very lucky to have him on the team.

11:41We will continue to build out his team so we are currently recruiting for a number of the site leadership roles that will ultimately be responsible for the mine production. We recently appointed what will be the process manager so this is a guy named Chris he's got a metallurgical background, very strong metallurgist. He was previously a corporate metallurgist at Barrick but he was also the interim process manager at SSR's Marigold mine which is very comparable to Black Pine, very same almost identical flow sheet and so he has the the technical background and also the operational experience so very very pleased to have him on the team as well.

12:26We are very close to extending an offer for a health and safety manager and we have a very strong candidate who's very interested in the maintenance manager. And then we'll just continue to build out that site leadership team. In parallel, we'll also strengthen the project owners team. Right now, we have secured our EPCM partners, which we're using M3 as our main EPCM partner. And we intend to do sort of a salt and pepper approach when it comes to the execution of the build. We will lean on M3's expertise in this EPCM space, but by peppering in some of the owners' teams, we really get that sense of ownership on each decision we make and make sure that we drive a really positive outcome.

13:15And so we are actively recruiting for a project director role. We'll be recruiting early next year for some help with our project controls manager. So we'll get a scheduler, a cost controller, and a dock controller. and then we'll just continue to build from there.

13:33Trevor Hall: You're revving up. Absolutely. Right now, our head count is right around 30 people in the entire company. This time next year, we'll be well north of 60, and by this time, the year after, we'll be at about 300 people. So this is what I find interesting because I think through a lot of chatter, Liberty has really positioned itself to be potentially the next takeover target. It is incredibly de-risked. I'm sure I'm not the only one that's brought this up today or this week, whatever. But you are revving up like that's not, I don't know if that's plan B or plan A, but you're revving up as if you don't have an option to build it yourself.

14:16Trevor Hall: So we... Other than to build it yourself. Yeah, no problem. No, we see that the real value for our shareholders will be in building it ourselves. and so we're not oblivious to the fact that we're an attractive takeout target but but that's not our goal here we don't want that if somebody comes in with a very large premium we're sort of obligated to take it but but we view that as still even if somebody came in with a really high premium we still believe there's more value for our shareholders by building this and experiencing that re-rate when we hit production and then potentially getting taken out then, maybe that's a good outcome.

14:56Ultimately, my first prize for me would be to build it and put it into production and keep it in the portfolio and use Black Pine as a foundational asset to take Liberty Gold into that sort of mid-tier producer in the next handful of years and really build off Black Pine's success and find other assets to create additional sort of legs in the stool. Yeah.

15:20Trevor Hall: Okay. You had$28.5 million at quarter end while you're continuing to do a lot of these lead item orders. So you are spending some cash. And then obviously you mentioned a number of people you are hiring, right? So how long does that$28 million last? And when does, do you have kind of a moment in the 2027 calendar for a financing deal, which kind of needs to be put in place? Yeah, so in addition to the$28.5 million that we have in Treasury right now, we have another$30 million coming in over the next sort of 12 months, some of which are coming in through warrants that are at$0.45. We're trading above$2 a share now, so we're pretty confident that money's coming in.

16:04But we also have some time-stage payments from the divestiture of our non-core asset, Gold Strike. And so we have another$20 million coming in over the next 12 months from that sale. So combined with the$28 million in Treasury, we are fully financed to finish engineering, finish permitting activities, to put deposits on long lead items, and run a modest drill program next year. We are targeting to have the project fully financed by probably no later than sort of middle of next year.

16:38Trevor Hall: Okay. Okay. What do those conversations kind of encompass right now I'm sure there's a lot of offers out on the table we have started that we actually started those conversations several months ago and after we published the feasibility study those conversations definitely ramped up and got a lot more serious and we do have you know a few options available to us and yeah we'll continue those conversations so watch this space closely. Okay. The company was included in the GDXJ ETF here not too long ago. So that broadens your shareholder base, right? Absolutely. What are European investors, you know, what are they asking you about as a U.S.

17:23Trevor Hall: developer? Just kind of curious. Yeah. So in the meetings that we've had so far at this conference, we're seeing a lot of questions around permitting timelines, permitting risks and project financing. I mean I think most people can see through the feasibility study that this has been very well de-risked from a technical perspective. We've done extensive metallurgical test work, we know our flow sheet is really straightforward, this is not new technology, it's been deployed across the planet for many decades and so from that perspective it is very well de-risked. So yeah most of the questions are coming in around permitting and project financing.

18:01Trevor Hall: Okay this could be Idaho's next big mine. Absolutely. Perpetua and Sted Knight and then you know Blackbine. That's pretty amazing that's a pretty good run for one state. If this does you know obviously get put into production here in the next two or three years right? Yeah absolutely. That's a good track record. Yeah and Idaho we believe is a fantastic place to build mine. The governor of Idaho is very pro-mining. We are actually part of the Fast 41 program, which is a federal program in the U.S. that helps drive visibility, but also accountability during the permitting process. And Black Pine is actually the first mining project in U.S.

18:47history where the state regulators have aligned with the federal regulatory agencies. And so as being a fully covered project under Fast 41, our permitting timelines at the federal level and at the state level are now fully published on the U.S. government's website. And so, yeah, like I said, we believe Idaho is a fantastic place to build a mine.

19:11Trevor Hall: And I may be wrong, not too far off, though, but Delamar is quite just behind Black Pine. Is that correct? Or are they ahead of Black Pine in that? No, we're definitely ahead of them as far as getting into production. Sure. Yes. But I'm just going to, does the state have capacity to work on both of those projects relatively in parallel? Well, the nice thing about the Fast 41 program is they have the ability to supplement resources, both from a capital but also from a people perspective. So if there is an agency that is at risk of falling behind in their permitting timelines, they can put their hand up and the Fast 41 program will help source and place some resources for them.

20:02And so that will help keep them on track. The Fast 41 program, it's a phenomenal program and we've seen some great results coming out of them. and actually I met with their executive director a couple weeks ago in Idaho. And she said, simply put, she will not accept we don't have the resources as an excuse for missing a timeline. So she will work hard to supplement those resources.

20:27Trevor Hall: That's great news. Great news. Okay, Tyler, thanks so much. Hope you enjoyed your first day. Pace yourself. A couple more days to go. All right, everybody, that's your update from Liberty Gold. And we're going to wrap up day one here. We'll be back tomorrow with day two from Zurich. So stay tuned for more corporate updates coming from the Precious Metal Summit. The information presented should not be considered investment advice. Mining Stock Daily Yen's affiliates are not responsible for any loss arising from any investment decision in connection with the material presented herein. Please do your own research or speak with a licensed financial representative before making any investment decisions.