As 2012 came to an end, we sat down with Jeff Tindale, CEO of Cliffmont Resources (CMO.V) to evaluate the exploration program of 2012, and to discuss the plans for 2013.
- You announced drill results from Merceditas and San Jorge in October. A lot of people weren’t impressed with the short intervals. As both programs were designed to drill-test mineralization at depth at Merceditas and to drill-test channel samplings at San Jorge. Do you consider your exploration program to be successful?
- Yes of course we were extremely pleased. We are drilling for the continuity of the historical epithermal veins below the old mines and confirmed that they continued at depth and in some cases seemed to increase in grade. In a mining scenario for this style of mineralization the company looks for an average of 1.5 metres to limit dilution when mining. The intersections we identified were consistent with
historical workings so we completed exactly what our objective was.
- Which exploration efforts would you like to complete in 2013? Will you continue to drill the currently known veins in order to complete a maiden NI43-compliant resource estimate?
- Our initial strategy of development is still in place; identifying sufficient mineralization to begin drifting which has now been permitted. This drifting will be the start of the mine at San Jorge and will give us the information needed to move forward with additional ramps, and drifts as we work towards small scale production. We will also continue detailed mapping, sampling and exploration drilling over the rest of the project as part of our exploration plan. If we do work towards a NI 43-101 resource it would be with the combination of drilling and drifting.
- Back in September, we estimated you could obtain your mining permits before the second half of 2013, do you still think this timeline is achievable? Is getting San Jorge into small-scale production still one of your top priorities?
- Yes, we have currently received our permits for exploration drifting and we are moving forward with our other permitting. At San Jorge, as it was in production recently we are looking at just amending the current permitting and not applying for new ones which is a big advantage. San Jorge is a top priority in our development and the company owns all the surface rights giving us full access.
- Are you looking to acquire more properties in Colombia or will you focus on the current projects for now?
- We are currently focused on San Luis as we have a large land package. As we have a first mover advantage we continue to identify other projects for potential joint venture, farm-out or core properties only if they increase shareholder value.
- What’s your current cash position?
- We currently have about $1M in working capital.
- Why should investors invest in Cliffmont Resources?
- Cliffmont has one of the most exciting new projects in Colombia. We have demonstrated we know how to get things done in the country and we look to give our shareholders exposure to potential production in a very short time frame. This is just the beginning and as we continue with our development at our San Jorge property we have potential propertywide as only 20 percent of our property has been explored. We believe there are multiple targets on our property which alone could be company makers. Cliffmont has put together a very strong social and environmental program which is essential in any successful mining project.
Cliffmont is ticking boxes to bring further advance the San Luis Property. We believe San Jorge could reach a steady production rate by the summer of 2014 if they are able to amend the mining permit by the end of Q3 this year.
If Cliffmont would construct a 100tpd mill and obtains an average mill feed grade of 8g/t AuEq, San Jorge could produce approximately 7,000 ounces of gold per year for an annual cash flow of around $7M, based on a $1700/oz gold price. As the market currently doesn’t care about non-producing assets, we feel the market will re-rate Cliffmont as soon as it realizes Cliffmont will be able to self-fund further exploration at San Luis.
Disclosure: Cliffmont Resources Ltd. is a sponsoring company. Please see our disclaimer for current positions.
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