Can you provide background on Melkior Resources and the landmark deal you recently transacted with Kirkland Lake Gold on your flagship Carscallen project?

Melkior is a very tightly-structured company with 20 million shares outstanding. That brings us to a market cap of around C$18 million (November 2020). Our portfolio is split between two assets in Ontario and two assets in Quebec. In Ontario, we have our flagship Carscallen project, which has had a very successful 2020. That success brought forward the partnership that we announced at the end of September with Kirkland Lake Gold. The details of this deal include a C$110 million option to earn-in and joint venture, which allows Kirkland to earn 50% of the project in return for spending C$10 million on exploration. Upon earning the 50% the deal converts to joint venture, which allows Kirkland the ability to earn another 25% for C$100 million.

In addition to Carscallen, Melkior has its White Lake Gold project, which is 20 kilometers east of Barrick's Hemlo mine. This is another option and joint venture deal we executed, this time with Barrick, who will have the option to earn 75% of the project.

Stepping to our Quebec side, Melkior has assets that remain under its full ownership and are operated by our technical team. The first is our Val d'Or project where Melkior has several near-term catalysts. We are currently completing an IP geophysics and airborne mag survey. Plus, we will be doing our maiden drill program in Q1 2021. Our last project is the Maseres project in the Urban Barry gold camp. Maseres is a larger project, with over 400 claims as part of it and we identified an over 12-kilometer conductive trend, which brought very positive soil results and had some very good, anomalous gold and base metal intercepts. As we look forward, we are assessing a potential drill program on that project.

How does Melkior’s dealmaking fit with its overall business strategy?

As a discovery stage exploration company, you always have to be producing catalysts. That is a big part of our strategy at Melkior. We always want to have projects to develop so that we continually develop our story. We want to create optionality to establish value for our shareholders and, in the case of White Lake and Carscallen, shareholders have the benefit of C$110 million in potential work commitment investment by a partner that is one of the best in the industry in terms of exploration success. At the end of the day, we still have 25% of the project and that is carried forward in a joint venture arrangement. That limits dilution, which for juniors typically plays a big part in financing and taking projects to the next level. In Melkior’s case, having partners such as Kirkland Lake and Barrick, we are able to progress those projects with their capital, and we are able to focus our efforts on our Quebec assets. This also leads to considerable de-risking, as there is obviously a level of credibility that comes to a company when you partner with major mining companies. They have recognized our exploration success, and they have the money, expertise and infrastructure that allows them to move the asset forward to potential production much faster than we are able to.

Another key to our success,is Melkior’s management team are completely aligned with shareholders, with over 30% ownership of the company. I am also confident to say that we have the lowest G&A burn in the industry. As a result, we are well funded and will not need to go back to the market for any financing before the end of 2021.

Is there any particular reason why Melkior chooses to focus its development in Ontario and Quebec?

As a grassroots exploration company, our principal job is to effectively manage capital, and in Ontario and Quebec, we have the infrastructure in place that we are able to conduct exploration programs and get the most out of every dollar raised. We cannot say the same about any other province in Canada or any other jurisdiction outside of Canada. There is still tremendous potential for success in Ontario and Quebec before you have to move on to other, less favorable jurisdictions.

Have you seen an uptick in M&A appetites from gold producers looking to augment their exploration pipelines?

The industry has seen a big uptick since March 2020 and even more through the Fall. We have now seen the Yamana-Monarch Gold deal, Agnico Eagle’s strategic investment in Maple Gold and our Carscallen deal with Kirkland Lake. That is just a start of many, whether it be takeovers, JVs or options. I would say the last six months have been busier than the last eight years, so it is very positive to see it. A big part of that is there has been significant underinvestment by the majors and mid tiers in exploration because money financing margins have been stretched. With the gold price dynamics firm, I think this is just the start of M&A in the space.