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technical team has a proven track record and the skills to not only find deposits but also
to build and operate them
Atna Resources Ltd.
Suite 510-510 Burrard Street
Vancouver, B.C. V6B 3A8
David Watkins, M. Sc.
President and CEO
Watkins, M. Sc.
President and CEO
Mr. Watkins is an international mining executive with
35 years experience in exploration and development, acquisitions and mergers, and mining
operations. Mr. Watkins was President of Cyprus Exploration and Development Corporation
and Senior Vice President, Exploration for Cyprus Amax Minerals Company for six years
prior to joining Atna.
Cyprus Amax (acquired by Phelps Dodge Corporation) was a U.S. based, Fortune 500,
multi-national mining company, which produced copper, molybdenum, gold, lithium, and coal,
and had annual revenue of US $3.2 billion. Mr. Watkins joined Falconbridge Copper Ltd. as
an Exploration Geologist in 1977 and became Chief Geologist responsible for exploration in
Quebec and mine operations at Lake Dufault and Opemiska in 1980.
Mr. Watkins was appointed Vice President, Exploration in 1986 and rose to the position of
President of Minnova Inc., the successor company to Falconbridge Copper, in 1991. Minnova
was a base metal and gold mining company with five operating underground and open pit
mines with 2,000 employees in Quebec, Ontario and British Columbia. During Mr. Watkins
tenure at Minnova, the company experienced rapid growth and achieved a market
capitalization of $500 million.
He graduated with a M.Sc. degree in Geology from Carleton University in Ottawa in 1970 and
a B.A. in Geology from Queen's University at Kingston in 1967. During the early part of
his career, Mr. Watkins worked with Newmont Mining and with Noranda as an exploration
geologist in various parts of the world, including Australia, Mexico, Ecuador, and Canada.
Interview conducted June 2005 by: Lynn Fosse,
Senior Editor of CEOCFOinterviews.com:
CEOCFO: Mr. Watkins,
will you tell us about your background with Atna?
Mr. Watkins: I have been with Atna for about five years
now. I joined Atna after having been a senior vice president with Cyprus-Amax Minerals
Company, responsible for their worldwide exploration and project development. I decided
that it would be fun to take on a junior company and try to build it into a significant
CEOCFO: How is that
Mr. Watkins: We are excited with the success that we
are having right now. Our most advanced project is driving toward completion of a
feasibility study and production as early as the second quarter of 2006. Our success here
will add significant value to our shareholders.
CEOCFO: Will you tell us
some of the details about the project?
Mr. Watkins: The project is the Pinson Property. It is
a gold property in Nevada that we have under option agreement from Pinson Mining Company,
a wholly owned subsidiary of Barrick Gold Corporation. The property is a past producer
that Barrick closed in 2000. It was previously an open pit operation and we recognized the
potential for some high-grade feeders below the old pits. Our exploration program over the
last year has been focused on discovering and defining a resource estimate of 1.8 million
ounces of gold. We are now driving underground to complete a feasibility study, which we
anticipate to have done by the end of this year.
CEOCFO: Where does the
project go from there?
Mr. Watkins: Assuming the project advances as
anticipated, we could see the Pinson property producing by the second quarter of next year
(2006). The key to the success, is that not only is Pinson a high-grade body of
mineralization, with average grades in excess of a third of an ounce, but the huge amount
of infrastructure in the district implies minimal capital expenditure. We will be able to
custom process the ore mined precluding the large capital expenditures associated with
building a plant. Much of the other infrastructure is already in-place on the property;
things such as electrical substations, roads, water pipelines, water rights and so on. The
project has a low barrier to entry, particularly in the context of a junior company like
CEOCFO: Do you have the
option to acquire it from Pinson and how much interest do you currently own?
Mr. Watkins: We have an option to acquire the property
from Pinson initially acquiring 70% interest in the property by spending US$12 million;
the cost of the feasibility study we anticipate the completion of at year-end. Upon
completion of the earn-in, several options are triggered for Pinson. Pinson could
participate pro-rata as a 30% interest joint venture partner or they could choose to back
in to increase their interest to 70% in which they would carry us for the next $30 million
of expenditures on the property over a 3-year time period. Should they not choose either
option, Atna may elect to buy the property for a 100% interest. All of the scenarios will
create significant value for Atna shareholders.
CEOCFO: Did you just
hire a project manager for that?
Mr. Watkins: That is correct. We had an excellent V.P.
of Operations who was responsible for the early-stage planning, organization and
implementation on a part-time basis. We recently hired a project manager to take on the
now, full-time job of integrating the ongoing work on site, including; construction of
surface facilities, underground workings, permitting requirements, metallurgical testing
and a variety of other things that go with the mining operation.
CEOCFO: You have things
going on in Chile as well.
Mr. Watkins: We are fortunate to have some highly
potential properties in Chile. While we have not been active in Chile for several years,
we have maintained the projects we felt were the best prospects, patiently looking for the
kinds of partner that we thought could advance it. We have an excellent partner and they
are having success in the work they are doing. We are excited about the potential of that.
CEOCFO: Are there other
properties you are actively working?
Mr. Watkins: We have six exploration properties in our Nevada
portfolio. Our strategy is to build a successful gold exploration, development and mining
enterprise and our focus is Nevada. Nevada is one of the most productive gold districts in
the world. Nevada is a relatively new camp, a place with good potential and where new
discoveries are continually made. We have properties in British Columbia, Yukon, and Chile
and will look for the right opportunities to advance these properties but our focus moving
forward is on Nevada.
CEOCFO: How are you
financing for the expansion?
Mr. Watkins: We are presently in reasonably good
financial condition; however we recognize that as the project advances and company
expands, we will need more financing. We will have a few milestones as we progress towards
production that could represent opportunities to go into the market and raise additional
CEOCFO: What sets Atna
apart from other exploration companies?
Mr. Watkins: I think the unique thing about Atna is
that we are truly an emerging gold producer. There are a number of excellent exploration
companies out there but not another one that I can think of that has the potential to
enter into production in the relatively short-term; that is to say less than a year, and
with the relatively low capital requirement that we have. To turn that around in a short
period, we anticipate the probability of being in the position of generating good cash
flow and looking for additional opportunities of continuing its growth. We have some in
the pipeline already and there are many other opportunities out there, which we are
beginning to look at.
CEOCFO: Do you focus on
garnering the interest of investors?
Mr. Watkins: Yes, we sure do! Our shareholder base has
an interesting history. The company has been around for 21 years. It went through a
discovery cycle with a high-grade deposit in the Yukon in 1996-1997. Many institutional
investors came in at that time. For a variety of reasons, that deposit has not yet
developed but over time the interest in it diminished and the institutional investors
withdrew causing the company to hit a low in the early part of 2001-2002. With a very
broad shareholder base and a lack of interest in what was going on, we refocused the
company on the gold strategy in Nevada and have been rebuilding investor interest since
that time. We have gone from a broad almost exclusively retail base to include a number of
institutional shareholders that are now a significant part of our shareholder list.
CEOCFO: In closing, what
should potential investors realize about Atna that may not be apparent at first glance?
Mr. Watkins: I think the point I would start with is
always good people; we have an excellent technical team with the skills not only to find
deposits but to build them and operate them, with a proven track record of having done
that. We have a board with both technical and financial backgrounds at the senior level. I
think good management and governance are key features that will help make Atna the success
we expected it to be. Following that comes the quality of the projects. We have a good,
conservative, technical team with the ability and experience to create a successful gold
exploration, development and mining enterprise and we have the prospective project,
Pinson, to initiate the game-plan.
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