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The Hughes
Exploration Group has shown good success finding mines, with a track-record of 1 in 35
Exploration
Metals/Mining
(GCR-TSXV)
Golden Chalice Resources, Inc.
711-675 West Hastings Street
Vancouver, BC Canada V6B 1N2
Phone: 604-684-2222
Richard W. Hughes
Chairman and President
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
Published – May 25, 2007
BIO:
Richard W. Hughes - Board Chairman, President
Mr. Richard Hughes, President of Klondike Gold Corp., is widely recognized as one of the
original people behind the discovery of the Hemlo gold mines in Ontario and was also
behind the discovery of the Balmoral Mine in Quebec. Mr. Hughes controls Hastings
Management Corp., and is the president of six companies currently listed on the Toronto
Venture Stock Exchange. He was also instrumental in discovering and putting into
production the Sleeping Giant Mine (owned 50% by Aurizon Mines and 50% by Cambior), and
also the Beaufor Mine (owned by Aurizon Mines). Mr. Hughes' proven track record and
extensive experience in the management of public mineral exploration companies enables
Klondike Silver to pursue potential world class projects.
Company Profile:
Golden Chalice Resources Inc. is a national Canadian mining exploration company that seeks
to find mineable mineralization in Ontario, New Brunswick, Quebec, British Columbia, Yukon
and Nevada. Creative geological interpretations along with the latest in geophysical and
geochemical surveys give this aggressive company a full range of prospects that may host
gold, silver, platinum group metals, nickel, copper and diamonds. The Company's portfolio
of properties provide shareholders good diversification in a number of jurisdictions with
different targets within a single company.
Please ‘check’ any highlighted words or phrases listed as inaudible; these words
or phrases could not be fully understood during transcription.
CEOCFO: Mr. Hughes, please tell us about the
company.
Mr. Hughes: “Golden Chalice has over 30
projects, most if those are in Ontario, Canada. Golden Chalice has About 68 million shares
outstanding; fully diluted it would be 99 million shares and that has about $1.5 million
in the treasury. The 21 million warrants outstanding all of the money, will bring in
another $4 million to the treasury. We are well financed and not looking for a financing.
We also have one project in Nevada where a senior company is going to be optioning that
and leaving us with a 20% net profits carried interest. Most of the other projects we own
100% other than a small net royalty to some of the vendors. We go after gold projects,
massive sulfide like copper and gold exploration and also lead/zinc/silver as well as
platinum/ palladium and nickel. Of the major projects that we have, there are about 6 of
them that we have brought forward out of the stable of properties. We spent about three
years, 2003-2006, accumulating our stable of properties we have in 2003-2005. In 2006, we
raised $11 million of flow-through funds to drill on the properties which is now
underway.”
CEOCFO: What is the common thread?
Mr. Hughes: “We look for something big.
There are lots of little mineralized narrow veins, but the odds of finding a mine are one
chance in a thousand from a prospect. However, our odds are one chance in thirty-five; we
beat the odds considerably. We have put the Belmoral mines into production; it started as
a dime, but it is now $40.00 and it is a great gold producer in Quebec for over thirteen
years. We did the Sleeping Giant Mine, which is in Quebec also north of Amos; that was
Perron Gold starting at .12 cents; it went to $7.00, and Dorville, which starts at .20
cents went to .13 dollars. The name change on that became Aurizon Mines Ltd. (AMEX:AZK;
TSX:ARZ), which trades around the $4.00 mark and that has been a great producer of gold
for the last fifteen years; around 70 thousand ounces a year. Two companies with large
gain are Golden Scepter and Goliath Gold Mine. About 20 years ago, we made a discovery in
Hemlo Ontario. Those both started around .25 cents; they went to $30.00 because of the
world-class deposit that we made at the Hemlo gold mines in Ontario. We brought in a
partner in Noranda, and they put in $276 million into the project; we did not have that
kind of funding. They earned 50% of the project for putting in the $276 million, which
left us with about 25% interest in each of the two junior companies. The company started
around .20 cents and went to $30.00; I split the stock three for one, the stock went back
to $10.00 and then went above $30.00 again. Overall the net jumped from around .20 cents
to $94.00 on Golden Scepter and about $96.00 on Goliath Gold Mine. The people were very
happy because about $2000.00 investment was worth just under $1 million at the top of the
market. That has been a great producer of about 400 thousand ounces of gold per year for
over fifteen years and that is per year, at a cost base of $150 US per ounce. It was
lucrative. It has an average width of about 65 feet and a net value of .28 ounces of gold
per tonne, so it is about $230.00 rock in today’s evaluation, per tonne.
The discovery Golden Chalice just made in Langmuir south of Timmons, Ontario, is a
nickel/platinum/ palladium property. The width appears to be at least 150 feet wide and
could be as much as 200 feet wide. There are four anomalies to drill; this is the just the
first one we put a hole into. With a dollar value of over $500.00 a tonne rock, it is
two-and-a-half times the value of our Hemlo deposit per ton. It is encouraging that the
stock has jumped up from $0.28 to about a $1.50. It is a huge property about 20 kilometers
east west and about 20 kilometers north south. Golden Chalice has 18 targets to drill on
about ? of the property that we have looked at so far. There is a lot of upside. The
company has over 30 projects and one of them is Abitibi east and that is looking for
another Kidd Creek deposit. The Kidd Creek deposit is about the biggest deposit in Canada.
It is worth about $35 billion and has been in production since the late 1950’s. We
are on to what we think could be a mirror image of the Kidd Creek deposit. It is about 60
kilometers to the east of Kidd Creek, same geological setting, same strategraphic horizon.
We are starting to announce the zinc, copper, and gold in that project. We hope to do some
deep drilling to find out where the prospective ore body might be. It is a nice project
but it would take several hours to go through all of our projects. We look for big things;
we don’t look for a little, narrow vein.”
CEOCFO:
How does your experience allow you to take on so much at one time?
Mr. Hughes: “We hire good people, the
right people and they are very intelligent people. We have a great crew in the field and
in the office. Together amongst our six or seven companies, we probably have staff in the
field and the office here of about sixty people and they know the mine business; I know
how to find mines and bring them into production.”
CEOCFO:
In closing, why should potential investors be interested in Golden Chalice?
Mr. Hughes: “Golden Chalice is starting
to spend about $5 million on its drill programs on the 30 odd projects. These are
mega-sized projects with big dollar returns. It is hard to find mines because the odds are
against you, but our track record has been 1 in 35 that has made the mines. Our projects
today are far better than in the past. We think we are going to have several successes in
Golden Chalice and anyone that is involved with the shares for the next year or two years,
they will see a lot of activity in the stock and hopefully a lot of upside potential, and
hopefully some new mines for Canada and we are working hard on it.”
disclaimers
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