What have been the major developments for Victoria Gold over the past year?

2016 was a transformational year for Victoria. We received our final permit for the Eagle Gold project in late 2015. In September 2016, we issued an updated feasibility study that has very good results, so we started to gain more attention. It is rare to come by a fully permitted project, with extremely good economics that is based in as safe a jurisdiction as Yukon.  In 2016, we conducted a $5 million exploration program, which, due to market conditions, was the first time in three years that we had done any exploration. In May 2016, for the first time since 2011, we did a financing which brought in strategic investors:  Tom Kaplan’s Electrum Group invested $16 million in Victoria Gold, and Sun Valley Gold invested $8 million. Tom Kaplan is recognized by many as a very savvy investor.  These investments, along with our exploration results and feasibility study, helped to take our market cap from $40 million to more than $300 million. We have also recently reached an agreement with BNP Paribas to arrange a $220 million debt facility. The project’s capital costs amount to $300 million and we have $40 million in our treasury. This leaves a funding gap. We are looking at various alternatives to fill this gap; it could be through equity, royalty or another strategic investor. We hope to finalize the debt in the next eight weeks and, provided that we secure the additional funds, we can start construction this year. The time frame for construction is short so that will enable us to be in production in 2018.

What are your expectations on the price of gold for the project to be successful?

For the feasibility study we used gold at $1,250. The project break-even is less than $900. You never build a project just to breakeven but, considering that our cash costs are less than $650 per ounce, it leaves us with a big margin at current prices.

What are Victoria Gold’s plans on the Dublin Gulch property for this year?

We acquired the Dublin Gulch property in 2009 and since then, we have devoted most of our efforts on developing Eagle. Only in the last couple of years we have looked at the wider regional potential. We have now identified, through geochem and geophysics, about 15 km of mineralized trend with numerous targets. Two years ago, we focused on an area called Olive-Shamrock, which now has a reserve of which some is included in the feasibility study. This year, we will spend a further $6 million on exploration:  $3 million in exploration at Olive-Shamrock, and an additional $3 million doing preliminary exploration work at additional targets we have identified.

What are the particularities of operating in the Yukon and what are your perspectives for this region?

Yukon is very much under-explored. The challenge with exploration in Yukon is that it’s only possible for four or five months of the year.  This means it takes triple the amount of time to do the same amount of exploration than it would take in a warmer climate, such as southern Ontario. I think that getting Eagle into production and Goldcorp’s acquisition of the Coffee project has brought new focus on the Yukon. The good news is that the production phase can be year-round. I foresee a significant movement of companies from other Canadian mining jurisdictions to Yukon in the near future. When we first went to Yukon in 2009, there were about 20 companies exploring. By 2011, there were probably about 150 companies exploring, and by 2015, there were about ten companies exploring. I anticipate that in 2017, that number being around 50 or 60.

Have you encountered any hurdles in the First Nations negotiation process?

First Nations relations is work; you have to keep at it and it’s a real team effort. We have a person on our team that has been dealing with the First Nation of Na-Cho Nyak Dun for more than 20 years, and knows everyone in the community. We have engaged with the First Nation and, as a result, we were able to sign a full benefits agreement in 2011. I believe it is a good agreement because it has survived three elections. We respect that we operate within their traditional territory.  Our intent is to mine the gold and to ensure that we return the land as close as possible to how we found it in the beginning, while providing sustainable benefit to the community.

What is the status of your Santa Fe project in Nevada?

We decided to sell our Nevada assets in order to focus our efforts on Eagle.  Victoria Gold’s Santa Fe property in Nevada is for sale, but none of us really want to sell it. We believe it has a lot of potential but have not spent any money on it in five years. Perhaps when Eagle is generating revenue, we will be able to spend money on Santa Fe.  The Santa Fe property is a real quality asset that could be a great add-on for someone or a true company anchor for a new group.  Similarly to Yukon, Nevada is under-explored.