TRANSCRIPTION OF FINANCE NEWS NETWORK INTERVIEW WITH OCTAGONAL RESOURCES LIMITED (ASX:ORS) MANAGING DIRECTOR, ANTHONY GRAY
Rebecca Richardson: Hello Rebecca Richardson for the Finance News Network. Joining me from junior gold explorer Octagonal Resources Limited (ASX:ORS) is Managing Director, Anthony Gray. Anthony welcome to FNN.
Anthony Gray: Thanks Rebecca.
Rebecca Richardson: Can you start by introducing Octagonal Resources?
Anthony Gray: Octagonal is an Australian gold focused exploration mining company that listed on the Australian Stock Exchange on the 5th of January this year. We raised $12 million by the issue of 48 million shares at 25 cents per share and we’re focused on developing exploration and mining assets, both in Victoria and Western Australia.
Rebecca Richardson: Okay thanks Anthony. Now where are your projects?
Anthony Gray: Okay Victoria – our project is centred at Maldon which is 35 kilometres southwest of Bendigo and in Western Australia, we’re located 70 kilometres southeast of Kalgoorlie.
Rebecca Richardson: And who’s behind the Company?
Anthony Gray: Our Chairman is Ian Gandel. Ian is a sophisticated investor; he’s also a director of Alliance Resources, Alkane Resources and Gippsland Limited. And we have a non-executive director, John Harrison who’s also a Victorian manager and he’s a mining engineer with over forty years’ experience mining in Australia and New Zealand. And I’m a geologist with over fifteen years’ experience looking for gold both in Western Australia and in Victoria.
Rebecca Richardson: Good, so Anthony for investors not familiar with Octagonal Resources, what’s your share price and market cap?
Anthony Gray: Okay our share price at the moment is at 16 cents, over the last month or so it’s ranged between 18 and 16 cents. We’ve got 100 million shares on issue which currently gives us a market capitalisation of $16 million.
Rebecca Richardson: Starting in Victoria an area with a long history of gold mining, what are your key assets in the region?
Anthony Gray: At Maldon we’ve 150,000 tonne per annum carbon in leach Gold Processing Facility, which is our ability to turn dirt into gold and generate a cash flow. We have 235,000 ounces of open-pit and underground resources and a 1.9 kilometre long decline that’s within 100 metres of the underground resources, which total 182,000 ounces of gold.
Rebecca Richardson: And when do you anticipate production?
Anthony Gray: We expect to be into production later this year. We’re currently waiting on regulatory approvals and as soon as they’re received, we’ll commence mining.
Rebecca Richardson: And now to Western Australia and your Hogans Project in the eastern goldfields. What is Octagonal’s stake and when did you acquire it?
Anthony Gray: Octagonal is earning up to 80% equity in the Hogans Project from a number of joint venture partners. Octagonal purchased this right to earn into these projects from Newmont in December last year.
Rebecca Richardson: Now the area is highly prospective with the Daisy Milano mine to the north of your project and you’re adjacent to the Mount Monger fault line. What does your exploration programme involve?
Anthony Gray: Octagonal’s budgeted $2 million towards exploration of the Hogan’s project over a two year period. The first phase of exploration which commenced in March this year will consist of regional aircore drilling and a gravity survey. This first phase of exploration is expected to cost $1 million and should give us a good indication as to the exploration potential of the entire project area.
Rebecca Richardson: And what have recent results indicated?
Anthony Gray: Recent aircore drilling results that we announced in early May are very encouraging. We’ve been drilling very wide spaced aircore holes, 160 metres by 640 metres, which is about as wide as you can easily expect to drill in the eastern gold fields and get indications of gold mineralisation that maybe related to a larger gold deposit.
We’ve had some significant results including up to 23 metres at 0.5 gram gold which we’re very encouraged by and we’re looking at infill drilling in the coming months.
Rebecca Richardson: Thanks, so potentially your stake in the Hogans Project could transform the Company. Is that the expectation?
Anthony Gray: That’s correct. We’re looking at developing a sustainable gold mining operation in Victoria to generate an ongoing cash flow. And we’re going to be looking at growing the Company in Western Australia where we’re exploring for plus million ounce gold deposits, to essentially take us from a junior gold producer to a mid-tier gold producing level.
Rebecca Richardson: Now to corporate matters. What are you spending each quarter?
Anthony Gray: We’ve only listed on the Stock Exchange in early January and have reported one set of quarterly expenditure results. We’ve budgeted to spend $12 million over a two year period with $5 million allocated towards open-pit and underground mining. $1.6 million towards resource definition drilling in central Victoria to sustain that mining operation, and $2.6 million in exploration with the bulk of that $2 million to go into Western Australia, where we’re looking to grow the Company.
This budget doesn’t account for any income and we expect to be producing gold as I said earlier, later this year.
Rebecca Richardson: Last question. Where would you like to see Octagonal Resources twelve months from now?
Anthony Gray: Twelve months from now, I expect to see that we would be producing both open-pit and underground sourced gold in central Victoria. We’re looking at ramping up our exploration in Western Australia, as I’ve said earlier we’ve had some very good encouraging results. I expect we would be bedrock drill testing and hopefully we’ll be onto a significant gold deposit.
Rebecca Richardson: Anthony Gray thanks for the introduction.
