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Interview
conducted by:, Lynn Fosse, Senior Editor, CEOCFOinterviews.com, Published –
August 26, 2011
CEOCFO: Mr. Gill, we spoke about a year ago and Lomiko has
changed a bit since then, what is the focus today?
Mr. Gill:
Our focus is on the Vines Lake property in northern British Columbia, which
is in the vicinity of gold and molybdenum properties. There is a Chinese
gold mine owned by China Minerals Mining to the direct east of our Vines
Lake property, to the north there is Columbia Yukon, which is a molybdenum
deposit and there is another discovery of molybdenum to the west.
Historically, it is estimated 2 million ounces of gold were found in the
streams during the Klondike Gold Rush. Therefore, we are in a really good
spot for minerals and mining discovery.
CEOCFO: How did you come upon your Vines
Lake property?
Mr. Gill:
Lomiko has owned the Vines Lake property since 2006, so it has always been
there in the property portfolio. In the intervening years, we allotted to
develop the lithium side of the exploration business, and we did that for a
period of time. We have always had a focus of lithium/gold and this is
particularly an interesting gold property in north British Columbia.
CEOCFO: What is happening today on Vines
Lake property?
Mr. Gill:
Right now, we are in the middle of a four-month long exploration program on
our Vines Lake property. We completed line grid sampling, which is the
taking of soil samples every 50 meters. The lines are 200 meters apart, and
this is done to give the geologists a good picture the chemistry of the
soil. Then we also took samples of rock out crop as well. Therefore, we are
well into this exploration program. The next step for us is to drill test
and put out exploration results.
CEOCFO: Is it difficult to get people to
work the property these days with so much activity?
Mr. Gill:
We are very lucky that we have a specialist in the Cassiar area that lives
right near the area, and has been working in the Cassiar area for thirty
years. I am referring to Ms. Lesley Hunt, our exploration manager. Lesley
managed activity at the Table Mountain Gold Mine, which is adjacent to the
Vines Lake property and was part of the discovery team up there. She has had
a long history, so we are very lucky. However, generally speaking it is tough
to get geologists and prospecting geologists especially into this location.
CEOCFO: Have you added to the property
recently?
Mr. Gill:
Absolutely! We initially had only twelve hundred hectares at the site and
there has been staking all around us. We have a pretty diligent team, but we
discovered that as time goes on some people lose interest in the area and
move on or they were staking on the basis of speculation that did not pan
out. Therefore, we took an initial chunk of 414 hectares to the direct west
of the property and then another 3,600 hectors to the south of the property.
The reason being simply that to the east there is a mine as well as a
deposit to the north, and there is a molybdenum discovery to the west. So we
think that there is good potential in this area and we want to make sure
that we tie down a lot of the property in the area before we put out any
information on Vines Lake itself.
CEOCFO: Does Lomiko Metals own the
property 100%; what is your philosophy of ownership?
Mr. Gill:
Our ownership philosophy is to own property 100% and to avoid option
payments that bleed companies without producing results. Therefore, we have
initially wanted to purchase properties and focus on properties where we
have ownership 100%, which is what we did. The only other aspect of it is
that there is a 2% NSR on the property and that is held within the
executive. I myself am the vendor of the property, so I control that 2% NSR
and of course that will be used to the benefit of shareholders of Lomiko, of
which I am a large holder as well.
CEOCFO: What is the infrastructure like
at Lomiko’s Vines Lake property?
Mr. Gill:
The infrastructure in the area of our Vines Lake property is very good. We
have Hwy 37 that runs directly through the property and goes from the
southwest to the northeast, so access is very good. From that we can bridge
out and travel along logging roads, gravel roads, and reach all areas of the
Vines Lake property. We are very lucky in that respect, with not having to
helicopter in material or people, saving cost.
CEOCFO: Do you have any molybdenum on
the property at this point?
Mr. Gill:
Right now, we do not have any molybdenum on the property at this point, but
we think it is a potential for this molybdenum on this property as well.
There are also other people looking for rare earth elements in the area.
What has happened is there is a large segment of this area in which you have
volcanic activity that has occurred and lots of destruction and lava flow,
so that is an area that you want to look at that has any kind of potential.
Molybdenum is specifically something that the Chinese groups are looking for
based on their consumption of steel, as it’s use in steel manufacturing. You
can also build pipelines with it that are non-corrosive, which is needed in
the oil industry. Therefore, there is a great demand for it and it is now at
$15 a pound.
CEOCFO: What is the financial picture
for Lomiko Metals these days?
Mr. Gill:
We have about $350,000 in the bank at this time with the ability to raise more.
We have gone to the market whenever we have needed funds, but only when we
have needed funds. We do not go just to build up the treasury and hold on to
people’s money. We have the capability and the shareholders are very
supportive, so we have had some good luck in that regard.
CEOCFO: Do you find in general that
investors are putting more money into the exploration given the current
economy, or still not so much?
Mr. Gill:
With most speculative investments as Lomiko is, it is difficult to attract
retail investors, but institutional investors understand the need for the
high-growth, high-potential investment such as a small company like Lomiko.
Therefore, we have a pretty good exposure to institutions, such as Pine Tree
Capital, which is a shareholder of Lomiko, and we have Bob Rose of Dominic &
Dominic as a shareholder. We have Mineral Fields and other related
institutions that have raised money for us, so we are very comfortable with
the direction things are goings in, but certainly, that enthusiasm has not
hit the retail sector yet. The next exciting phase of the minerals and
mining industry is that we are going to see individual investors coming up
and getting involved in the sector. As they continue to do so, and there is
a steady stream of them, certainly prices will move up in a northward
direction for all of junior mining stocks. If there is anything that can
ever be considered undervalued, I think we can see that mining stocks are
undervalued in a general sense. Lomiko is itself is a exercise in risk
management and our future depends on managements ability to deliver a
discovery, so our focus is having good management, good geologists, a tight
balance sheet, a really focused approach and entrepreneurial spirit.
CEOCFO: Do you do much outreach to
retail investments or is that for the future?
Mr. Gill:
Certainly we try to keep people involved and informed. We have done a few
emails to different lists when we started exploration, but we do not try to
spend too much money. Basically we want to stay on the radar of a lot of
people so that they know who we are when we do make discovery.
CEOCFO: Are there any other projects
that Lomiko Metals is currently working on?
Mr. Gill:
Our focus is on our Vines Lake property right now. That is the most
interesting project at this point in time. Everything else is a little bit
further away.
CEOCFO: Potential investors have lots of
companies in your sector/industry to choose from, why does Lomiko Metals
stand out?
Mr. Gill:
We have a management team that has a fantastic track record of success, and
we know where to look for minerals and make discoveries. We have a very
focused approach. We want to buy properties that are 100% owned and not just
option other people’s properties. With the metals and mining sector the way
it is right now, we are going to get return on investment for investors
either through this property or other ones that we will acquire. That is an
approach that is unique in this business. In a 52-week span we have been up
to about $0.12 and down to about $0.4, and we are sitting at $0.6 now, so it
is a good opportunity.
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