“My job is to increase value for shareholders,” said Phillip Walford, CEO of Marathon Gold (T.MOZ). Increasing value for Marathon shareholders at its Valentine Lake Gold Camp, in central Newfoundland, means drilling. And drilling means a steady flow of results. In Marathon’s most recent release Walford stated, “The high-grade areas tested to date in the Main Zone of the Leprechaun Deposit are much better defined by our recent drilling. Four drill rigs are continuing to add to the resources at both the Marathon and Leprechaun Deposits. We are on track to complete the property-wide resource estimation by early November and begin the PEA.”
“With our drilling at Marathon we are converting the inferred resources to measured and indicated,” said Walford. “This is the largest drilling program we have done on the property. We’re doing a lot of infill work as well as exploration to expand the resources. In the short term, we are developing the critical mass for the Preliminary Economic Assessment. We are on track to have a new resource estimate by the end of October and then go forward with a PEA. But we’ll continue to drill into the new year on exploration targets and resource development.”
In early September, Marathon announced that it had hired Robbert Borst to manage the upcoming PEA. Borst will coordinate a team of professionals to produce the PEA. “We need a first-class study,” said Walford. “We want the “A” team all the way through.”
To achieve a “first-class report” Marathon has to have a number of pieces lined up. There is, of course, the resource itself. But there is also metallurgy and environmental impact to consider. Plus there is a degree of mine planning which has to be undertaken.
Walford is very confident about the metallurgy and recovery potential of the Marathon deposit. “We have to make decisions. Heap leach or flotation or combination: we have choices. Our mill recoveries have been very high. The PEA will refine our choices and it will outline the areas where we need to do further work.”
Marathon’s general plan is to pit mine initially. “We have at least two deposits on the property which could stand alone,” said Walford. “We would start with pits but there is also an underground element. We see areas of mineralization at depth. At least one deposit goes down to 1 kilometre and is up to 100 meters wide. We are seeing visible gold at depth.”
For Walford, who has been in the mining business since 1969, the drilling at Valentine Lake is very encouraging. “We’re excited by the results we are getting.”
Those results have also created excitement in other quarters. Shawn Ryan, the famous Yukon prospector, has led a staking rush in Newfoundland and sometimes refers to the ground he is exploring as being on the “Marathon trend”.
Which is interesting, but Walford is more focused on the nuts and bolts of moving the Marathon story ahead. Asked about the processing of the Marathon core, Walford said, “We are very fortunate with our lab. Eastern Analytic is a two-hour drive away from our site. We are a priority client and we get 10 day turn around.”
Jurisdictionally, Newfoundland is very mining friendly, “The government is very positive. They understand mining,” said Walford. “They understand what we have and they can see the possible economic benefits and continue to give financial support to the mining industry which has benefited Marathon
For the moment Walford and Marathon are focused on expanding the resource, doing the Preliminary Economic Assessment and moving forward on the permitting process and feasibility. “We add value by getting the PEA completed and moving forward with developing the project.
Walford expects to release new reserve numbers at the end of October or in early November. He expects the PEA to be done in Q2 of 2018. Then Marathon will have to make some decisions as to how best to continue adding shareholder value. At the moment, Valentine Lake holds 2.1 million ounces of measured and indicated plus inferred gold. As the 60,000 meter drill program proceeds it is a good bet that much of the inferred will move to the measured and indicated column and that, as the drill program moves along strike, more gold will be found.
With many majors looking to replenish their reserves, Marathon will be an attractive takeover target; but it might also be an excellent joint venture opportunity for a larger company or a project that Marathon may want to put into production
Either way, Phillip Walford wants to ensure the maximum value for Marathon’s shareholders.