Aurania Resources Ltd. (ARU) Earnings Call Transcript & Summary

Thank you for standing by. This is the conference operator. Welcome to the Aurania Resources Ltd. Exploration Update Conference Call. On the call with us today, we have Keith Barron, Chairman and CEO; and Richard Spencer, President. [Operator Instructions] And the conference is being recorded. [Operator Instructions] I would now like to turn the conference over to Keith Barron. Please go ahead.

Well, hello, everyone, and thank you very much for joining us today. Richard Spencer is going to do the -- an exploration update for you. And so I'll let our President take it away. Thank you very much.

Thanks very much, Keith, and welcome, and thanks very much for calling in and taking the time. We will be having a Q&A session afterwards. We will try and keep the presentation relatively short to give as much time as possible for everyone to ask their questions and some questions have been sent in already. So we'll deal with those first after the -- as soon as since the presentation is finished. So Aurania is an exploration company that is focused on Southeastern Ecuador. And I must just be upfront and say that, obviously, we will be making forward-looking statements, and all those comments are on Page 2 of the presentation. And then just as a very high-level overview. So we've got about 208,000 hectares contiguous concession in a mountain range on the Southeastern part of the Andes, 42 mineral concessions, and we've been drilling there for a while. It's a jungle covered area, very high rainfall. And so, we depend on drilling very early in the exploration program to ensure that we can actually see the rock, that we can see the geological continuity. And so, we drill earlier than most companies would drill and the reason for that is the intense jungle cover. And we call that drilling scout drilling. So we've drilled about 15,000 meters or so. And yes, we continue with that at the moment. So -- of the -- so, we've done basic exploration over the -- most of this area. It's never been explored before. And the exploration that we've done has -- it's broad-based enough that it will pick up any mineralization that's there, any metals that are there. And so what we found from that broad exploration net, if you like, is the indications of gold systems, which we expected to see there. Indications of porphyry systems that are copper targets and we expect to see those from -- because both of those kinds of deposits are found in the area adjacent to us in the south, which is a very well-endowed gold and copper belt. And then in addition to those 2 kinds of targets, there's a certain salt type that we didn't really expect to see there. The one is the sedimentary-hosted copper. And the other one is silver-zinc, that's also found in sediment. So those are the 4 kinds of deposits that -- or styles of mineralization that have turned up in our exploration of the area. And just finally, the exploration team does have and the management team does have a lot of experience in the adjacent belt. So on Page 4, we show the concession area in the Southeastern part of Ecuador, the red area on that map. And then I just wanted to talk a little bit about the contiguous area to the south of us to the bottom part of that slide in -- on Page 5. Our concession area again shown in red at the top part of that diagram. And the point of this slide is just to show that there is a huge endowment of both gold and copper to the south of us. This is the same geological trend that we are in, in the red area. So we would expect that we -- our whole exploration approach is to find multiple deposits. We are absolutely focused on discovery of multiple deposits. The 1 difference is that in the Southern area, it is more deeply eroded. So, many of the deposits are actually exposed at surface. Many of the porphyries that have very good endowment of copper in them are actually exposed at surface. You can feel them, you can touch them. Where as in our area, they tend to be a little bit deeper. They tend to be covered, which is -- it complicates our exploration a little bit. It's not daunting. It's just one of those things that we have to live with in that area. So on Page 6, focusing in on the concession area itself. The project actually naturally divides itself up quite nicely into an epithermal area down in the bottom left. And in fact, there's a second epithermal belt in that sort of blank area that's starting to emerge at the moment. And then we go up into the area in orange circle where the main -- exploration for sediment-hosted copper is focused. Then all the red blobs where the silver-zinc target is. And then in green, the 2 principal areas for copper and gold exploration through these so-called porphyries. Tatasham is a target that I'll talk about in a minute. And also Awacha is another area that's emerging and sort of jostling its way up in the profile and in the priority listing. So one thing that I should just reiterate while we're talking about this is that we get a lot of feedback from shareholders saying, hey, guys, what on earth are you doing? You're talking about gold 1 day, you're talking about sedimentary copper, then porphyry copper, then sediment-hosted silver and zinc. And what is it that you're focusing on? We are focusing on discovery. We feel that our job is to create value for the shareholders. And quite honestly, it doesn't matter whether that comes through a silver discovery or a gold discovery or copper discovery. And we believe that we have potential to make multiple discoveries. And so our field teams, the geologists that are working in the field, all of them are focusing on -- this is a group that's working on the epithermal stuff for gold. There's another group that's working on the sedimentary copper and a third group on the porphyries and a fourth group on the silver-zinc. So, all of those guys are working in parallel and the news that we released just is whatever happens, we feel happens to be topical at that time. So, we're not jumping around. We're extremely focused. And that's the reason behind why the news might be sort of perceived to be jumbled. The Lost Cities on Page 7, which was the original premise of us getting into this area. And that's the reason that Keith originally applied for the concession area. The black and white image in the background is the mountain ranges, the topographies and the flat areas of the valleys. And we've been a little bit quiet on the Lost Cities, the search for those 2 gold mines that we believe are in this area. But effectively being quiet doesn't mean that we haven't been working on it. In the top, there are a couple of little sort of temple-shaped icons up there. And those are areas where there were 2 really, really well-developed cities, Huapula and Kilamope. One of those, Huapula is projected to have had about 10,000 inhabitants that seemed to have been sort of [indiscernible] in origin, because everything is from the [indiscernible] square, streets, drainage, all the rest of it extremely organized. And those guys lived there from about 500 BC onwards, had very fine pottery. And what we're beginning to realize is that there was a trade route that joined both -- that area of high population. It's a nice, flat, great agricultural area. And Huapula and Kilamope were joined to the Amazon by that route that's shown there. And we're picking up bits and pieces of that route and just beginning to realize how crucially important it is and those 3 stars that are there are salt springs that are still important to the Shuar today where the Shuar are producing salts from those fountains today. And that salt would have been fundamentally important. It would have been a huge trade item of enormous value for the Amazonian people, who had no access to salt. So we're beginning to realize that there was an infrastructure in this area before the Spanish arrived and the colonial Spanish that we believe mined the 2 gold deposits of Logroño and Sevilla. And so, this ancient road that's been there for thousands of years and used for thousands of years is in the green and yellow. And then there's a sort of white with a red margin road going up to the north, completely different style of road. It's cobbled. The rest of the road is not cobbled. And we think that, that's a Spanish road. And we feel that, that road that goes -- that's marked in the white and red, goes up to where Sevilla was located and we're obviously doing a bit of quiet work in the background there. So, there's been a lot of questions about what we're doing, where we're focusing, when we're going to get access and the access is opening up now nicely. So, we'll be talking more about the Lost Cities shortly, that work is going on in the background. Turning over on to the next page. Tiria-Shimpia, the silver-zinc target. We've drilled 4 holes, the hole 4, we're pretty excited about. We've decided not to drill hole 5 yet. And the reason for that I'll come on to in a second. We're going to wait for the results. They should be back shortly on hole 4. And once those results are in, we'll say what our plan is for the Tiria-Shimpia area. So, those results are due in December, and we'll publish them as soon as they come in. Turning to the sediment-hosted mineralization. And I've used -- we've used the term sediment hosted rather than sediment-hosted copper, because this applies to the sediment-hosted silver-zinc as well. We've just had Gregor Borg on site. This is him working with the geologists in the core shack there. And Gregor has -- he spent his entire career working on not only copper, but lead and zinc and silver comes along it in basins. And so, we were looking at core, both of the red bed hosted mineralization, which is mainly copper dominated and then the silver-zinc that we've seen in the limestones as well. And what is incredibly exciting about this is we've been talking for a while about linking those systems. And if we do link them, they are -- they constitute about 55 kilometers long, which is massive. And obviously, the deposits are going to be little pieces along that 55-kilometer trend. And what was so incredibly exciting about Gregor's visit is that he confirmed a whole bunch of textures and things that we were seeing in the core where we could see it -- the same textures in the red beds and we could see them in the limestones. And that helped us -- and he confirmed that they were the same thing. So, he helped us confirm this sort of fundamental relationship and link between the silver-zinc in the limestone, which is a different kind of rock to the copper in the red bed. So, we made so much progress during Gregor's week-long trip there, and he left treading on air. He is just so excited. And yes, I'm going to go into a couple of technical details here. Well, in fact, not so technical, because I'm going to be referring to Irish Porter cheese. But one of the things that Gregor confirmed is that we're seeing on the right-hand side, that's a photo of core. So it's about 5 cm, 5.5 cms wide. And these are little fragments of limestone. But where the black arrow is, you can see that they are actually embedded into each other, which means that, that limestone was soft at the time it was deposited in the sedimentary layering. And why is this important is that, that limestone would have formed on the shoulder of one of the faults. So, if we go across on to the vertical profile on the left-hand side of Page 10, you see the sort of bottom light brown stuff going into the sort of ruddy brown, you see those faults and they have a high shoulder on them. And that's where the limestone would have developed. And then it's the branches were that limestone when it was sort of cheese like in -- so it was sort of hard, but it was still like cheese, reasonably soft. It was hard enough to break. But as it slipped down that fault, it then -- it was breaking as it went and then it connected in the bottom of the faults. And what is so crucially important about that is that phase of fault that we drilled with this texture and that's shown in the core on the right-hand side, and we've called that texture, the IP breccia, because it looks exactly like that, porter cheese that we've shown in the bottom graphic. And that's exactly what it is. It's a cheese-like thing that -- anyway, that accumulated there. And the importance of that is that it says that, that fault was moving, and that fault was likely to have been pumping the metal-bearing fluids into that area. And the egg-shaped blowup of the vertical slice on the top left, that shows our model of the metals coming up and being moved up on those faults and then precipitating along the bedding. And so, that Irish Porter cheese texture is telling us, hey, that fault was moving and it was pumping the fluid. So it's a detail. It's a technical detail, but it absolutely tells us that we're close. Okay, this is one of the folks that you need to pay attention to. Going on to Page 11. The other thing we've been talking a lot about evaporites and the importance of the evaporites. And the evaporites are just reactive layers. They are important because they are sealed. And all our whole model for the -- be it copper or silver-zinc is related to metals moving in these fluids around the basin. And we've got proof that we're dealing with -- and this at the top is a photo of salar -- or Uyuni Salar in Bolivia. These are massive extensive things. And now we've got the proof that we -- meaning what's exactly a Salar that is 150 million years old. And these things are important in terms of copper, lead and zinc mineralization. So, we just have different textures. The boreholes. So we've got an image from a hole 7 on the right and hole 8 on the left, just showing the different textures that we get in different parts of the salar. And going on to Page 12. I mean all we're trying to do is see where we were in relative to that salar because it's important in terms of the mineralization. So on Page 12, we've got the fault, that sort of translucent parity red stuff is potassium salt, the pale yellow stuff, the urine-colored stuff is ordinary table salt. And then those are all different textures that we see that just says that the salt that was on the right-hand side has now migrated out of those rocks and that migration is important because it makes the rock permeable, it makes the sedimentary layering easy for the metal-bearing fluids to get into. And it's also important because the sulfate in the rock provides a mechanism of capturing the metals. So, we've made huge progress in our understanding of where we are in the salar systems. We can use this zoning to go -- to move towards the most sort of prospective part of that salar system. So on Page 13, again, this is a vertical slice through where we're drilling at Tsenken. 09 should start in very shortly. It hasn't started. I haven't actually checked this morning. But in yellow, we're finding those are where those salar systems there are, the so-called evaporites that have -- critically, they have salt, but they have the sulfate in them and the sulfate is the thing that will give up its sulfur to the metal-bearing fluids and capture that metal as a sulfide. So, with Gregor, we reviewed hole 6, which is crucially important, hole 7, hole 8. And we're beginning to identify where the salt layer were and where those targets are. So we're drilling hole 9 at the moment. We're excited about hole 9 because it's close to where the spreads would have been brought up by the faults. Moving across on to Page 14. This is Tatasham, the MobileMT data, the lower left graphic looking from in plan view looking from above. The red is the conductivity. So, we would expect more sulfides in those areas and the sort of gray hedgehog on the bottom left is the 3D model. The 3D inversion of the magnetic data. So, there are actually 2 kinds of data represented here, the magnetic in the gray and the conductivity from the MMT in the color and the profile on the top right is just a slice. It's a vertical slice through the graphic on the bottom left and the pineapple looks like porphyry and the conductive area around the edge is what one would expect to see on the edge of the porphyry. This Tatasham is partly covered by up to 400 meters of sandstone. So, it's a little bit of a complicated target. It's not something that we want to drill 1 hole on and believe that we'll get a direct hit. We need to approach this a little bit cautiously. And therefore, it's been juggled a little bit in the priorities. Next page, on Page 15 is Awacha, that's emerging. It's moving up the priority listing. The pink body and these are all plan views, looking down from the top. The pink body is the conductivity, like was shown in red on the Tatasham model previously. This is very, very conductive stuff. And the little blue bodies, the sort of blue gray things, those are the magnetic bodies. And that target number 1 looks like a porphyry. It's about a kilometer wide, which is typical of a porphyry. The porphyries are very -- they can be magnetic. And having the magnetic thing in the middle and then the pink conductive zone around the edge, that looks like porphyry. Target 2, that's a donut with all this conductivity around the edge of it. Maybe the porphyry is not magnetic in that case. But our target for the porphyry would be -- still be in the middle. Because the -- in the middle of the donut, because the pink stuff is likely to be around the edge of the porphyry. And then in fact, that piece that sort of trends down to the bottom of the diagram that [indiscernible] that might be a third target there. Anyway, the blue dots are the molybdenum, the green dots are copper. Both of those, obviously, the copper [indiscernible] over copper porphyry and so is molybdenum and the molybdenum doesn't move much [ in form ]. So, this is a pretty exciting stuff. We feel that going back to our history of discovery of porphyries in the southern part of the belt, this is what some [indiscernible] would have looked like. So -- and it looks as though it's not covered. So, it's a simpler target, and this is why it's been moved up in the priority ranking. Latorre C, we continue to -- different team working down there and moving it towards target definition. I'm not going to dwell much on that. And just to sum up, I mean, we've had a couple of questions on COVID. Our COVID infection rate in Q4 so far has dropped down nicely, we had 1 person infected. There is a new wave coming, but we're maintaining our COVID protocols. And yes, that's all I've got to say about that. I mean we're keeping all the protocols in place. And then on Page 18, please keep the questions coming. Carolyn is the one who's most reliable, she can track down Keith and myself. And with that, I'll hand over to Carolyn to deal with -- just to read out some of the main questions that have come in so far -- come in via e-mail.

Okay. Thanks, Richard. Just to cover off a few that I think you tried to cover during the slide presentation, but just so that we're answering those questions. I've got a question about the allocation of drill rigs to target. I know you went through this, but maybe just so it's clear for everybody.

Yes. So, we drilled hole 4 at Tiria-Shimpia, and we stopped drilling there. We're watching cash very, very carefully. And so we've stopped until those results come back. We've just started or we should have started this morning the drilling on hole 9 at Tsenken. And again, we'll probably stop the drilling after that and wait for those results to come in. And then we are preparing [indiscernible] for drilling. But as I mentioned, it's a bit of a complicated target. We are trying to advance Awacha as quickly as we can to get that drill ready and Latorre will probably come after that. So, our priority at the moment is probably Awacha next for drilling, then Tatasham and then Latorre C. We've slowed down the drilling. And the reason for that is we are watching every cent as, obviously, we've always done. But the Ontario Securities Commission has wanted us to ensure that the last raise that organized marketed offering and the concurrent private placement that, that provided enough cash to keep the company going for a year and to ensure that we have enough cash to pay for the concession fees and all that kind of thing. So that is good for the shareholder. It's great. Because it gives us a year's worth of runway. The flip side of that, where we are under a little bit of pressure is that we don't have as much for exploration as we would like to have. And that was very clear in the prospectus. And so, we've been very careful with our drilling and our burn rate. So that's why we've slowed down the drilling a little bit. And to be perfectly honest, I think that, that probably works in our favor and that we have time to look at the holes. We have time to get the results back. What it does mean is that if like for Tiria-Shimpia, for example, having stocked off the hole 4, the results will come back in December. And then based on those results, we might decide to do more drilling there. It means that we will probably jump around a bit more with the drill rig, but it's just to be very, very, very careful with cash.

Okay. And maybe you can comment on access to Awacha?

Yes. Awacha has been one of those areas that has been elusive in terms of access, like in the Southeastern part of the concession block. I'm happy to report that there's been phenomenal progress. We have 3 steps to take in Awacha area, and 2 have been successfully taken in the last couple of days, and we are due to take the third one in the next couple of days. So, we should have the green light to get in there pretty smartly. And as soon as we do get the green light, we're going to flood it with geologists.

Okay. And then there's a question about Lost Cities access. When can we expect to be on the ground exploring in the concessions that...

Yes. That's the same area as Awacha. And although Awacha is a porphyry target, you would have noticed it from some of our slides that we've got the word gold in there. It might be a porphyry copper gold cluster. And very often where you enhance those kinds of porphyries and then many examples of this in Ecuador and Chile and Peru. You have gold-bearing veins, some of which can be extremely rich, sort of sitting on the shoulders of those porphyries. So -- and you could see by that slide on the Lost Cities, the 1 Spanish road that is a cobbled road. So, it's a very different style from the very old roads, that seems to go up into the Awacha area. So, we're thinking that once we look -- what I can say is that the geologists who are going in to do the exploration on the porphyry target at Awacha are absolutely primed to look forward for old workings there as well. And there is some indication of stuff up there in the [indiscernible] as well.

Okay. Next question also relates to Lost Cities, and this might be one for Keith. The recording from [indiscernible], Keith couldn't comment on the location of Lost Cities. Can he comment now? Or has there been no progress on securing the site access on or off our area?

No comments.

Okay. All right. I'll move on to the next question. What will it take to deploy the third rig? Is the reason for parking the third rig until a discovery is made purely economic? Or do you still need to refine the target site Latorre C, for example?

And I would say that it's absolutely economic. So to be clear, we're drilling with 1 rig at the moment. And that is purely economic. So since our marketed offering that's because of the stipulation by the Ontario Securities Commission that we had a runway of a year, which includes the concession payments in March and all that kind of thing, it's limited the amount of money that we've got available for drilling and exploration in general. And I'm not complaining about that. I think the Ontario Securities Commission, their job is to look after the security of the investors. So -- and that's good. It just means that we've had to go back and we -- if anyone mentions the word budget to me, I'll have a heart attack, because we've been in budgeting mode for the last couple of weeks. And so, we're being really, really careful with the money, seeing what we can trim. Because whatever we can trim from any other thing, be that social engagement, be it environment, be it corporate, that frees up a little bit of cash to go to the drill bit. So, that's what we're involved with at the moment. So, third rig is out of the question at the moment. Second rig is a possibility. But the way we are at today is we're using 1 rig. And as I mentioned previously, [indiscernible] to give us a chance to get the results and all that kind of thing, I think, is going to allow us to be a bit more efficient in terms of burn rate. And so, we're literally waiting for the results to come in from hole 4 on Tiria-Shimpia to know whether we've made a discovery there. And then on the basis of those results, we'll evaluate whether we bring in a second rig to do any more drilling there or whether we continue to make -- to look for a second or third discovery.

Okay. Thank you. Next question, will we do a joint venture without a discovery hole? And then I guess, second part of that question, what is to be expected after a JV deal is sealed, be it Tsenken or Tiria-Shimpia?

I think I'll answer that, but I'll answer it in a minute. We'll go through all these questions first. I'm going to make a bit of a statement here in a minute. Okay. Can you hear me?

Yes, go ahead, Keith. Keith, are you there?

I'm here.

Okay. Go ahead.

Okay. I don't know when this mute button is muting me or not. I'm sorry. I can't tell from the phone. So, what I just said was that I'm going to address the question about JVs in a minute or two.

Sure. So, go ahead with your statement.

Oh, okay. Well, now you saw from the corporate presentation about the COVID situation. And let's just hope for the whole world that we're most of the way through this damn thing. But you saw that from the outset, we've had 55% of our employees with COVID. Last year, of course, we were shut down from March until June. And then after that, we were only allowed 50% of our complements, both in the field and in the office. Now we broke the rules in the field a lot, because we didn't have anyone looking over our shoulder. But our numbers were reduced and sometimes communities went from red to green and then back to red. Also when somebody got COVID, we had to isolate and put into quarantine everyone else who worked with them. And I don't think anybody out there realizes the seriousness of the situation. But of course, the whole world had to deal with this and with lockdowns and everything else. But this is one of the reasons why we didn't have a lot of progress last year in terms of our field results. And quite frankly, the share price over the last year has not been very impressive. I'm not happy with it. We had to deal with the COVID situation. Let's hope that it's getting -- we're getting through the thing now, and it's almost done. And as Richard said, we've only had 1 case in the last quarter, which is fantastic. But really, the shareholders have to cut us a bit of slack here. We are subject to all the regulations of the federal government here, and we have to follow things. And let's just hope that this new variant doesn't take hold. And if it does, we are going to shut down our activities immediately and can serve the cash. I want that message out there loud and clear. My foundation is doing a sports tournament, a football tournament right now for 10 villages, actually 20 different teams, 10 men's and 10 women. And we have had no cases of COVID amongst the players. No cases of COVID amongst the spectators. All of these folks are Shuar. So, they're all the indigenous people in our area, and that's fantastic. So let's just hope that this -- we're on the backside of this whole pandemic thing. Second point that I want to raise, 5 days ago, the Bank of Montreal, BMO, came out with a report on Warintza. Now I can't attest the accuracy of this report, because this is not our property. We haven't reviewed it or anything. I'm just going to tell you what's in the report. Now it's 15 kilometers south of our southern boundary more or less. They have 12 drill rigs on the thing right now. The company is at CAD 1.4 billion market cap. That's as of 5 days ago. Now BMO has done their own number crunching in the back room. These are not numbers that Solaris is saying, but BMO is saying that they have in site 1 billion tons of 0.5% copper, 33.5 years of production. And I would say, looking at their drill pattern, they've drilled about 10% of it so far, and that makes this thing potentially a massive size. BMO is calling it a potential super pits. The mineralization seems to be 5 x 7 kilometers long. And if you saw the graphic that we have on Awacha, it's not that big, but it's getting there. Certainly very, very interesting for us. And I just want everyone to be aware that the shareholders that bought into this thing before -- Solaris has really taken off in the last 2 years, but people who have stuck by us for the last 4 years, you have lucked into the world's best proximity play. The world's best proximity play. Because we have porphyry target -- porphyry copper type targets on our property. And I can tell you, Awacha is very, very compelling. It does not have -- it's not covered. So there's QSP type alteration that quartz sericite pyrites in abundance right on the surface, and that's why we're getting both the moly and then in the stream sentiment. It's fantastic looking. Anyway, so -- please folks don't fixate on individual drill results. These are not what the majors are interested in. Major companies don't look at this stuff and suddenly throw a fits and call things dusters, from one individual drill hole to the next drill hole. We are playing the long game here. We're not trying to goose the market. We're not running a pump and dump. And we're not building mining dynasties. But we are looking for a situation here where with these massive, massive mineralized situations here on the property, the copper, silver and the zinc silver together is 55 kilometers long. Who else in the business owns something that's this big? And I can tell you there's no one. The only one to do is the communist government of China, in China. That's the only people, who have something that's 55 kilometers long and mineralized like this. This is potentially something that can make a real dynasty for a major mining company. And Gregor Borg has talked, he's found collapsed breaches and tailors breaches in the inner drill cores. Now -- okay, so that's not going to maybe excite the market, the retail market. But I can tell you right now that these are very, very intriguing things for a major company. Because it shows that there is porosity in these rocks and potential to have precipitation of copper and zinc and silver on very, very large scale. This is a real, real milestone for the company. So just to finish here, we are reaching in our exploration. We're getting up to, let me just say, critical math here. We're getting to the limit of what a junior company can do, quite honestly, 55-kilometer long mineralization, where the hell you put the drill holes in that. I mean a very, very big company would be very interested in that, because potentially, there's going to be several mines along that strike length. And that's the attraction. So we are thinking and talking with -- we've had folks in the data room for some time, but don't be at all surprised at some point when we will be talking seriously with someone about joint ventures. This has been the plan of the company now since the inception. We are not building mining dynasties here. We are not intending to go into production. And I'm not going to be beguiled into that. The exes strategy here is to get JVs and then get various chunks of the projects sold off and get the best deal that we can for the shareholders. That's the end of what I've got to say here. And I'll let you take it back, Carolyn.

Okay. Thanks, Keith. Do you want to address that question that I asked earlier? Will we do a joint venture without a discovery hole?

Sure. If somebody wants to joint venture without a discovery hole, there's a saying in the mining business -- and please don't start firing flames at me and saying I'm a misogynist, but you don't undress the bride before the wedding. And we are not going to go and put ourselves up against the wall and spend huge amounts of our budget drilling holes that realistically a major company is going to drill anyway. So as I've said, and -- we have a very, very major potential world-class discovery just on our southern boundary. We have geology that looks very, very similar. And the shareholders can draw their own conclusions, whether that's valuable or not.

Okay. Keith, can you go into a little bit about what's to be expected after a joint venture deal is sealed?

Well, I -- there's nothing on the table right now, just to be very clear. But a pretty standard joint venture for a company such as ours would be potentially giving up 60% or 70% of the project for maybe some cash, but usually, it's an expenditure on the project. So the major company has to spend the money. And it's an earn-in over time. So there have to be several milestones that are met, before there are certain percentages that the company earns in. This is pretty standard in the business. And at the end of the day, depending on how long the joint venture would last, I would prefer to have things that we're taking, they take us all the way to a pre-feasibility or even a feasibility. Sometimes when things are looking really, really good, you can get taken right to production. That's unusual, though. Usually, the junior company has to find its proportion of the money to build the mine. But that's rather a moot point because quite often, and quite seriously, when you get to that point, often the major will just gobble up the junior partner and acquire them. So -- but in any case, if we continue to raise money and dilute the stock and push a lot of paper out, it's going to have really the same effect, if not a worse effect, than doing a joint venture with a major. If we do a joint venture with a major, we have credibility. We have access to their bank account and also access to their expertise. And that is a real, real major components of why we do things like this. I don't pretend to be an expert on all facets of geology and neither does Richard or Jean Paul. We're doing the best we can, but there's a lot of stuff here that's -- well, Gregor Borg has really given us an education. He's got more years in that type of target than I do. But yes, no, you pull in 1, 2, 3 majors, whoever it is, I don't know, and you get access to their team.

If I can just add to that. I mean, many of the JVs that have been done in Ecuador are of the type that Keith is talking about, where the company gets carried to completion of the feasibility study. That would be our primary goal in the joint venture negotiation. Because it means that both sides are absolutely aligned at the end goal getting to the definition of the discovery or the deposit as quickly as possible. And secondly, just to reiterate what I mentioned earlier about the natural grouping of the gold targets and the copper targets and the sedimentary copper and the sedimentary silver, zinc, the property is sort of naturally divided at the end itself through multiple joint ventures. We are unlikely to do a joint venture on the whole thing.

Okay. Thanks. Just in the interest of time, I'm going to try to quickly go through these questions, so we can open up the floor to Q&A. I have a question here asking how deep and thick the mineralized layer is at Tiria-Shimpia? And then just along with that, how long will it take to get drill assays back?

Okay. So we won't comment on thickness at the moment. And the reason for that, I'm not just BS-ing. The -- so the intercept was at about 50 meters between 50 and 60 meters, so shallow. And the mineralization has been oxidized. In other words, it's been weathered and rusted. So it makes it a little bit difficult to estimate grade, because it's not the sort of bright shiny stuff that people have seen in photographs from Tiria-Shimpia, sort of pale orange clay looking stuff. And that's why we're being very, very cautious about what we're saying about it in the press release and everything. So we'll talk about that as soon as the results come in and the results should be in December.

Okay. Sorry, Richard, did you comment on how long it typically takes to get drill assays back?

Yes. It takes typically 6, 7 weeks, something like that. In the case of Tiria-Shimpia, we put them in for rush assay, which is typically 3 weeks and that it might be 4, because the labs are under a bit of pressure at the moment. So in December, we should have it.

And I have one final question here about a...

Carolyn, can you hear me? Carolyn can you hear me?

Yes.

Yes, I just want to add, we are subject to securities law. And not all of our shareholders are on this call and the broad public. And we are very restricted from what we can say publicly about the thickness of mineralization and grade without presenting that in the formal press release. I know that a lot of our retail shareholders are not really aware of the rules, but we have to follow the rules.

Thanks, Keith. And I'll turn this last question to you before we open up the floor, because we're running out of time. Keith said in Malmo that we could expect news about Peru soon. What's up with this?

Okay. Can you hear me?

Yes.

And, so you just got to have to wait and see on that.

Okay. Thank you. I think we can open up the floor for Q&A, and then I'll turn that over to you, guys.

[Operator Instructions] The first question comes from Mark Reichman with Noble Capital Markets.

So it appears that you're beginning to focus on the targets that you want to move forward, at least on Page 7 of your MD&A, plus maybe Tiria-Shimpia and Awacha. And I was just wondering if you could discuss your plans mentioned in your financial filings to reduce the number of concessions in Ecuador by 50% by March 2022. In your plans in Peru, I mean I know that the concession fee go up. So if you cut them 50%, you'll be level with last year. But what impact might that have on the ability to do JVs? Or is it -- can you cleanly define the concession area such that you're able to still move those key targets forward?

Yes. Mark, we...

Richard? We lost you there.

Keith wanted to take that -- Carolyn, Keith wanted to take the question.

Yes, yes, I'm going to take that one. I'm sorry, I can't see if I'm muted or not muted. I'm very sorry about that. That's all the confusion here that's going on. So it says in the document that we would drop ground. That's not necessarily true. What we would do is offload the obligations. So I'm not necessarily in favor of dropping ground and getting nothing for it and nothing from it. And -- but we do have to get out of those obligations. Now the concession fees are not going to double, because we have been -- like all the other players in Ecuador, we've been given an extension. And that's because a lot of the permits, including water permits were not forthcoming from the governments. And some companies that had drill hole -- drilled targets on their property, were actually not even able to access them for 4 years, because of lack of a water permit to do the drilling. So they've got extensions. Our extensions are anywhere up from 1.5 years to actually 3 years. It depends on where it is on the concession. So we don't have a massive bill coming up next March. And yes, so that's what I've got to say about that.

So just as a follow-up. So the information, for example, in the MD&A, that's obviously you have the filing requirements and et cetera. So that's -- so that's kind of a plan. But I guess what I'm kind of taking away from this is there's quite a bit of wiggle room. In other words, if you just take at face value, the footnote where it says to reduce the obligations and that you're not going to spend any more money in Peru. Obviously, as an exploration company, you're not generating revenues. You're dependent on the capital markets to continue to fund your efforts. So a lot of that will hinge on the capital market access, but there's still going to be some play in terms of these -- the exploration budget for next year and the targets that were identified and also just how you approach the concession decisions.

No, that's correct. And I think we were pretty clear in the prospectus and in the MD&A that our intention is to do something with Peru -- the properties in Peru prior to midyear next year when the concession fees are available. So as Keith mentioned, there will be news on that. The fold of -- before at the end of June.

Okay. And then also just on some of the drilling, I thought it was kind of intriguing your last release, and I was just wondering how the information from hole 7 and 8 kind of informs your geologic understanding of sinking and one, and maybe the positive implications that it might have for additional targets? And then second, how are you feeling about the concept of a link between copper, silver at Tsenken and the silver zinc at Tiria-Shimpia?

Mark, the big thing from Gregor Borg's trip was the confirmation of the possibility of copper mineralization in the red beds, I've been pretty negative on that, because I couldn't see a way of precipitating the copper in the red beds. But once he was able to confirm that these strange sort of broken rocks, the so-called breaches, where the footprint of where there was salt. And that does 2 things. It will -- it gives us a precipitation mechanism. So I was absolutely wrong in thinking that there was no precipitation mechanism in the red beds. There absolute yes. And it comes from the observation of that broken rock, which is the footprint of where that salt layer was. The salt layers would have been like a Salar today, tens of kilometers and extend. And that -- so the salt moving out of that layer does 2 things. It creates permeability, because it breaks up that rock and it allows the fluids to get into that specific layer, and it's easier for the fluids to move along that layer. A fundamentally important -- the second thing is the salt is with this mineral called gypsum, which is a calcium sulfate. And the sulfate is what gives the -- gives up its sulfur to take the metal out of solution and precipitate it as a sulfide mineral. So there absolutely is the perfect mechanism for extracting that metal out of the fluid and obviously, to form a deposit, you need a big concentration of that fluid. And the evaporites layers of salt and gypsum that key sulfate mineral, is it provides the permeability. It provides the seal to stop the fluids from moving everywhere. It provides a way of concentrating those fluids. And certainly, it provides a way of donating its sulfur to the metal to make it precipitate. So hole 6 was crucial because it hits the salt dome. Hole 7 was fundamental, because it hit the thick layer of evaporite and crucially, right underneath that evaporite is where there's this pyrite enrichment. And so what that says is the whole mechanism is working, because that -- the pyrite says that, that fluid that got to that part where we hit hole -- where we drilled hole 7 was rich in iron. If it dropped its copper and lead and silver and zinc already, only iron was left in that fluid. And it saw the sulfur in the sulfate in that evaporite layer and it precipitated. So it's the proof that, that mechanism works. And one other little bit of proof that we've got in there that is spectacular is that the evaporites contain a lot of a metal and element called strontium. And so the only place in a basin where you would get high concentrations of strontium is in the Salar, in the evaporite horizon. And lo and behold, the pyrite bearing zone has got strontium in it. It's got very high strontium. And that is the last piece in the puzzle that says absolutely this sulfur that precipitated the iron to form pyrite came from the evaporite because -- and we know that because of its strontium content. So the model is absolutely working. And we didn't have it in today's presentation, but we had one of Gregor Borg's prior graphics where it showed copper zone going through the zinc zone into the lead zone -- sorry, copper, lead, zinc and then pyrites. And hole 7 hit that pyrite. And we know from a hole 7 that the whole mechanism that we're talking about works. So hole 8 was important, because it showed us where there was a footprint where a sulfuric had been. So that is -- that layer is another target. And in hole 9 where we've started it, should go through that same target of hole 8 and then down into the one that we got at hole 7. But again, we're hole 7 hit pyrite. Hole 9 is close to the feet of faults where the -- that fluid should have dropped its copper.

The next question comes from [ Terry Ortslan ] with TSO.

Actually, Keith, you're speaking, can you go first?

Okay. I just -- can you hear me now?

I can. We can -- I'm sure we all can hear.

Okay. Okay. I just wanted to say, remember, 2 years ago, Gregor Borg talking about a double whammy. This is the only basin as far as he is aware and he's worked all over the world that has both porphyry copper intruding into it and sedimentary-hosted copper. And potentially the low-grade halos on what are apparently shaping up for us as a couple of copper porphyries on our property, they would have been mobilized by all that salts into the sediments. Basically, I'm talking here. We are interested in baiting the hook for the majors here. And this is a very, very interesting scenario. I'll let you go ahead, Terry.

Thank you, Keith. Maybe we should wrap up this thing with some headline issues. One next door, Peru had very inconsistent information and policy and strategy this week and then reverted back to some normalcy, but the cat is out of the bag. The neighbor is becoming a bit more restricted for majors to be involved in and to consider joint ventures for instance. So Ecuador still shines in our books, but I don't know things happening that probably can give you an update, including the fact that [ Real Mario ] is one discovery we had this week as well, which is not next to [indiscernible] . It's 35 kilometers away. So district play is becoming quite important and that one of the hole they have is spectacular, obviously. But there is a lot of mineralization in this country and the country, maybe wondering when the shovel is going to go in. The question is that you are talking about a joint venture, and I heard from Richard talking of joint ventures. So it's not a singular thing. It's probably a plural thing to where you may dissect the area and also segment it. Plus not one deal or template may work. Some templates work whereby there is a time element, what is with expenditures and then partnership starts and so on and so forth. Who the operator going to be and either one can be different. On the one, will be joint ventures, possibility, because one want to do it. Other ones will be also looking on their rearview mirror, what they're missing, and they may be interested in that. And secondly, are you going to be the operator. And three, in a sense that how would you dissect that -- the area? I am just wondering.

Look I think that it's really easy to dissect the area by target type. And so geographically, the areas are reasonably well defined. So I think it's realistic to do multiple JVs. And the last thing that we want out of the joint venture is a company earning a 50% holding in the block for having expended x million dollars in the field. And that kind of joint venture just absolutely doesn't work for us, because then you hamstrung. They stop spending, and they've got 51% or whatever. And then you're absolutely against the wall. So we will not go for that kind of joint venture unless we're forced into that situation. The joint venture that we would like to go for is the one where you get to the feasibility study as soon as possible. Because that means that the majors are aligned with us and with our shareholders. Our -- everyone's goal is to get to the joint venture a year to get to the definition of the deposit and the economic study and the completion of that economic study as quickly as possible. I mean the way that some of these companies -- the big companies can throw money around. They can spend $10 million, $20 million, $30 million, $50 million in a flash. And sometimes don't achieve terribly much with that, because it's a rounding area to them. To us, that would be a disaster. If they spend $50 million and get us to a completion of a feasibility study, and that's great, but we don't want to be hamstrung by big expenditure coming in and not actually achieving all that much.

Well, okay, the big part of the question was, would you be the partner whereby you'll be operating the exploration program?

Terry, I don't know. I mean I think our feelings to relations are such that, that would be one part that we would very like -- very much like to keep our toes. And I think the majors respect the relationship that we've built with the Shuar and certainly, if I were in the shoes of a major, I wouldn't touch that. But as Keith alluded to earlier, we -- the majors have expertise that we don't have. And if they wanted to take over the technical exploration program and they have better knowledge than we do, better expertise in that particular field, be it looking for porphyries or sedimentary copper or whatever, it's absolute pleasure. Our goal is to get to a definition of a deposit as quickly as possible.

There is no secret, how many majors are in the country is looking or active or prospecting. So that's a given. You don't have to get anybody I assume brand new coming in, although they'll be looking into it as well. But next door neighbors as I said earlier, is the position, if it's truly position, uncertainty. They're mining countries, they may fix it up eventually, but it's not immediate. And here, we have discoveries, shovel ready some of them actually. So -- and the government still looking for the shovels to go in and that they should actually, I mean they would see, and there was an ex, I believe the last few days or weeks. How did they go? Anybody attended that and what's the government's expectations in terms of next year.

And Terry, I think 2 points. I mean the one that you make about many majors being here, is obviously absolutely valid. But what's exciting as well is that some of the people that are in our data room are majors that are not in country yet. And I just -- I heard Mark Bristow of Barrick say something the other day in an interview that I thought was jaw-dropping. Someone asked him about that same old question about political stability and why he can work in places like the Congo and all that kind of thing. And Bristow's answer was that, if you actually really do want to make a difference to the world, you've got to go to the places that you need most help. And then he quoted all sorts of numbers and statistics as to the impact that their operations have had in a place like the Congo and I sought good on you. You're not one of the people that's hiding behind, political stability and say, oh, well, I'm not going to work there. And then -- and I mean, we are absolutely engaged with the Shuar, and I believe that we are making a very positive impact on them. And to hear, the CEO of a major recognized that as one of the fundamental sort of basic things of being a human being, I thought good on him. I've never ever heard a CEO say that. And I think he needs every accolade from that attitude.

This concludes the question-and-answer session. I would like to turn the conference back over to Keith Barron for any closing remarks.

Thank you very much. Hopefully, you can hear me. So yes, we'll just wrap this up. Some very, very interesting stuff coming out of the field. And some very interesting developments, both in our general area in Ecuador and elsewhere in Ecuador. And as has been commented, Peru and Chile as mining venues are not looking too great these days. I attended an expo here called Ecuador Open for Business last week. There were 500 delegates from foreign countries here. It's fantastic. The President spoke. This is certainly one of the premier places to go for mineral exploration on the whole planet. Thank you so much for your participation and for listening and stay well, God bless.

This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.