Wealth Podcast Post

Gold Mining with Doug Hurst

George Grombacher January 23, 2022

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Gold Mining with Doug Hurst

LifeBlood: We talked about gold mining, how the industry is approaching the increasing demand for precious metals, how to identify good opportunities, and what the future holds with Doug Hurst, Chairman of Elevation Gold. 

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You can learn more about Douglas at ElevationGold.com and LinkedIn.

Thanks, as always for listening!  If you got some value and enjoyed the show, please leave us a review wherever you listen and subscribe as well. 

You can learn more about us at LifeBlood.Live, Twitter, LinkedIn, Instagram, YouTube and Facebook or you’d like to be a guest on the show, contact us at contact@LifeBlood.Live.

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Our Guests

George Grombacher


Doug Hurst

Episode Transcript

george grombacher 0:00
Come on

one level, this is George G. And the time is right. Welcome. Today’s guest strong, powerful Doug hearse. Doug, are you ready to do this?

Doug Hurst 0:20
I am indeed. I’m looking forward to a conversation. It’ll be great. Yeah. Likewise, Doug is the chairman of elevation gold, he has served as an executive with three mining companies that have gone on to be acquired for over $2 billion. Again, excited to have you on. Doug, tell us a little about your personal life more about your work and why you do what you do.

Right, right. Well, so So I’m a geologist by training, but I never got that professional designation. And because I jumped into the corporate, the corporate and financial and a fairly quick after school, so I sort of never really worked my way through to being a professional geologist. But my background is geology. I love geography as a kid, and I was science oriented, but terrible at math. So so so geology was a was a wonderful blend of those kinds of things. And, and I got a very, very early introduction to the markets, and how the stock market relates to the mining industry. Mining Industry is fairly capital intensive. And so there is a direct relationship between the two industries. And so early days, the early days of my career, actually, when I was even just in university, the first summer that I worked, worked as a prospector slash geologist pounding on the rocks and flying around in helicopters and such, I worked with a guy named Don McKinnon. And Don McKinnon was the Prospector, who staked ground that a huge gold deposit in northern Ontario was discovered. That was called hemlo. And hemlo was a big discovery in the early 80s. Right on the Trans Canada Highway. And, and I started to understand the link between the market which, which was providing capital for drilling, and, and, and how mining companies related and so I got a really early start. And it was just fascinating to peer over the fence into the financial end of things. Yeah. And so that’s sort of how I got my start. Yeah.

george grombacher 2:43
Nice. I appreciate that. So how has it changed? Maybe it’s totally different. Maybe it’s still pretty similar to that experience?

Unknown Speaker 2:55
Well, you know what I mean, metaphorically, it doesn’t change at all. It’s the equivalent of a guy with a donkey, and a pic. Breaking off rock and looking for gold, right? And but what has changed is that the mode of transportation is a bit different. But that’s kind of about it, right? It’s a very pioneering type of industry, it’s an industry that, that that caters to those that are thinking out of the box. Well, so as a really good example, this this prospector that I worked with Don McKinnon. He, he found gold in rocks right on the Trans Canada Highway. So the Trans Canada Highway is the equivalent of, of an interstate highway, right? And, and he was just all he did, he just did the dog work of working his way along the highway, digging up sources of information, and breaking rocks. And even though geologists might come in and go, Well, these rocks aren’t quite the right formation for gold. He didn’t care. He just broke off the rock. And if he saw that there was gold there, then you know what, there’s gold there. And so it was, you know, so he had done was a real out of the box thinker. And, and I sort of carried that forward in my career, where, where things that things that you know, are wrong are probably correct, and you never know. Right, so.

george grombacher 4:27
Yeah, well, I certainly appreciate that. And that was a very, I don’t think the term is serendipitous, very fortunate that Don was able to find the gold right there on the, the main thoroughfare, because I imagine that that’s one of the really one of the biggest challenges to mining in remote areas, like, like, where he like, like Canada, where folks are looking for gold and other precious metals, is how do we actually get all the stuff there? And then how do we get the rocks where we need to actually get them?

Unknown Speaker 4:57
Well, absolutely. Well, I mean, so so I’ve been involved in three companies from the ground up. I’ve been a director of many companies over the years, but but ones where I was directly involved was a company called International royalty Corporation. And the second one was called Newmarket gold. And, and the last one was called northern empire. And, and I’m, and I’m involved with a couple of companies right now. But the common thread with those three companies was, was just finding assets that either the market had forgotten about, or an idea that the market had forgotten about. And, and then, you know, I’m not smarter than anybody else, I just happen to recognize that every now and then an idea rolls across your desk. And you look at it, and you say, okay, that’s the one right? After having, you know, so I don’t know, if you went to, you know, school after after high school, but, you know, part of the process of that was throwing spaghetti against the wall, and you throw spit, and when it sticks, you know, it’s dead, right? Yeah. And so, so, so in my business career, I just threw a lot of spaghetti against the wall. And, and every now and then one would stick, and I would have to sit up and pay attention. But the other thing, too, that I had to, that I had to overcome, was an idea would roll across my desk, and I would look at it and say, Well, you know, that’s that, that doesn’t make any sense. And I just, and I wouldn’t give it its due. Right. And it would roll off the end of my desk, and never to be, you know, brought back again, but every now and then an idea rolls across your desk, and you look at it, and you go, Oh, okay, something is changed. There’s different data. You know, so what is it about this thing that, that I would have ignored it previously, but now it’s good. And so I think that that’s probably one of my skills is just being able to change my opinion based on data. Yeah.

george grombacher 7:09
Which, which is certainly a sign of extreme intelligence and, and lots of wisdom. into wisdom there we got Yeah, perfect. So in, in, in today’s world, talking about the opportunities are looking for it’s it sort of struck me as as value investing, if we’re talking about the stock market, you look for companies that maybe are undervalued for some reason, but you can see that this is this is really, really valuable. If there’s just a couple of things that maybe are changed or fall into place. Is, is there more, he talked about money kind of to get started? Because y’all need money to be able to, to explore and to drill? Is there more money coming into the space now that prices are going up? And, and and we’re seeing a greater need for for precious metals?

Unknown Speaker 8:04
Oh, what so that’s really interesting, I would say sort of, and, you know, I’ve been through several bull and bear markets over the over the years. So when I finished my career as a field geologist, I mean, I only was in it for a couple of years after school. I joined a brokerage firm as their mining analyst just to kick around. You know, just just to bridge the financial and the and the tech of a world. And within six months of me being hired by that brokerage firm, the crash of 1987 came along. So that was a major reorientation of my value system. And it was just something that, that that taught me, like, you know, this is the world today, something happens, oh, it’s a different world tomorrow. Right? So. So when you look at the vault, the flow of capital in and out of the mining industry, we’re sort of in a, in a period where there is some money coming into the industry for very, very specific targets, and for specific assets. But it’s not a wholesale rush of money into the industry. Not yet anyways, I mean, I think that there’s an upward bias to the precious metals right now. And that will probably start to prompt more and more capital coming into the industry, but we’re not quite there yet.

george grombacher 9:32
Do you think that that’s going to happen?

Unknown Speaker 9:35
I do. I do.

george grombacher 9:36
It’s, yeah, it strikes me that me just reading the tea leaves and seeing that we are in great need of all these metals to do green projects and to make phones and electric cars that we we need more metal and it takes a long time to get these minds online for my understanding. So Oh,

Unknown Speaker 9:59
yes. Absolutely, absolutely. Well, and so, so it’s interesting. I mean, it’s interesting that you mentioned that, you know, you have on one side, the fact that that carbon based fuels, you know, should decrease, right. I mean, climate change is an issue that, that we can see going forward. But what’s going to replace it? And, and there is some of a system that will generate enough energy to sort of replace it, but it’s not, you know, 100% of our fossil fuel use cannot be replaced by the renewable energy systems that we have in place now. And, and you’re right, how do we get there? Well, we’re going to need an awful lot more aluminum, we’re going to need a lot more copper, we’re going to need all these rare earths that create magnets for generating systems, we’re probably going to need some nuclear along the way. So uranium and, and gold, the industry that I’m most familiar with is, is something that we’re going to need to create a base for our financial systems. And so these are all and as you describe, it takes a long time to put a copper mine or a bauxite mine or aluminum smelter, or a copper smelter. It takes a long time to build these assets. And we just we haven’t ignored but the government incentives have not pushed the older industries towards creating new product for new worlds going forward. And I think we’re probably 10 years behind on creating enough renewable energy infrastructures, so that we can phase out fossil fuels

george grombacher 11:53
is fascinating. The speed at which we were able to create the vaccines people said, will take years and years and years and we made them in a very, very short amount of time. Yep. If Normally, it would take five or 10 years to get a mining operation online. If you put enough money into it, could you speed that up?

Unknown Speaker 12:15
See, money’s not the issue. It’s permitting huh? Yep. And so so well, the vaccines a wonderful case in point operation work speed. Took a hot knife through butter on getting rid of red tape. Right. And, and you could argue that maybe it was a little bit quick, but boy, did it ever generate results. And, you know, so during the Second World War, Lord Beaverbrook, in Britain ramped up Spitfire production, because he cut red tape, kind of completely bypass the whole thing and really ramped up production. And now, I mean, it’s, you know, it’s difficult to argue that you should short circuit a permitting process to get a mind in production, it should be carefully considered, and there should be all sorts of things in place, but the process could be made quicker for sure.

george grombacher 13:14
Data. Interesting. So, your work with elevation gold. Tell us a little bit about what you’re working on.

Unknown Speaker 13:23
Yeah, absolutely. Well, so when so Mike Allen is the the president and I’m the chairman of elevation. And we work together with in a company called northern empire and northern empire, we found an asset called the Sterling, which was in Nevada, and it was, it was an asset that the market had really forgotten about. And, and we started kicking tires, looking around for other assets. And we found the moss mine were intrigued by the geology that the gold deposit at the moss mine is, is held it. And so we really started looking at it hard. And we realized that, that the markets sort of acknowledged that there was a mine there, but they weren’t. They didn’t fully understand the potential of it. And so so we went into merger talks with Northern vertex A, it went on for a good five or six months. And then in February of last year, we completed the merger. And, and, you know, we bought we brought a different set of expertise to the table. So we had, we had a lot we have a lot of experience in capital markets, raising capital, understanding the the capital markets, and so that was something that the vertex guys didn’t have as much of. We also we also brought a lot of technical expertise to the table. So my gallon as the president is a geologist, a registered professional geologist. And, and we also brought the VP of exploration for for our company, again, in warbird. Board and more, Rick has been able to bring all sorts of incredible talent to the table, figuring out the geology. Now, we’ve also, we also brought some capital to the, to the company, the original, we did an original financing, which is part of the conditions of merger. So we brought capital. And we’ve also cleaned up the company, we there was a convertible debt, that was higher priced. So we got rid of that, we rolled the company back. So we fixed the share structure of the company, we rolled that back six for one, and, and we started to understand the mining operation. But way more importantly, is to understand the geology and the mechanisms of how this gold occurs at the last minute, and so we just saw this wonderful opportunity to bring an asset that had been dwelling in the shadows, and to bring it into the light.

george grombacher 16:11
Nice, I appreciate that. And so what what are what are the plants moving forward with the moss mine? Yeah, so.

Unknown Speaker 16:20
So the moss mine is, is occurs in about a kilometer and a half. And, and outside of that there’s another six or seven kilometers of the moss vein where the vein is sticking out of the ground, and it has gold values on it. And there have been no drill holes. So. So this is an opera, this is the easy opportunity for us to start marching our drill rigs away from the open pit mine, and to see if we can’t expand the resources dramatically, and we think we can the geology is quite permissive. There are values on you know, as I say, the vein is kind of sticking out of the ground. And we’ve got gold values on surface and there’s no drilling. So that’s something that we’re gonna fairly easily capitalize on. And that’s something that we’d like to, to really start in earnest in the new year.

george grombacher 17:15
Nice. Well, that’s certainly exciting time.

Unknown Speaker 17:18
Yeah, absolutely. It’s very interesting. It’s, it’s a great district. And we’re, it’s the same as Nevada geology. But we’ve come over the state line in Arizona, which is part of the reason why it was unrecognized. You know, it’s funny, you, you know, you’re in one paradigm and you step out of it, and you go to another paradigm, and they don’t, and they don’t understand each other. So you step over the state line. The rocks are still there, but it’s not in Nevada. So people kind of shrugged their shoulders. But But definitely, the geology is still there. And so is the gold. Nice. Well, very exciting.

george grombacher 17:55
I like it. And okay, so unique opportunities and challenges. Instead of dealing with the state of Nevada, you’re also dealing with the state of Arizona. And while they may be very similar states, they could be totally opposite when it comes to what the regulations are and everything else.

Unknown Speaker 18:11
Yep. Yep, that’s exactly right. Yeah, yeah.

george grombacher 18:15
I love it. Well, Doug, the people are ready for that difference making tip? What do you have for them?

Unknown Speaker 18:23
Well, I’d like to say hope is not a strategy. But I think that I think that along those lines that, that that in fact that it’s, it’s, it’s all about the people. And you can you can have good management and good people. And if you have a good asset, then it all works. You can have great management and good people and a terrible asset. And they will understand that it’s not worth spending money on and they move on. And then you can take bad management and people that aren’t so kind and they can have a great asset and they will screw it up. And so it really comes down to people. You know, can you get your ego and your hubris out of the way enough to say okay, I don’t have expertise there I need to bring people in. And and to be able to recognize that and so so that’s a big, big part of what I see in the business going forward. Working with the right people. Making sure that they are empowered and and once you have them in place is to make sure that they are supported and heard and understood.

george grombacher 19:58
Well, I think that that is great. stuff that definitely gets come up. Having the right people is key. And everything you just described makes all the sense in the world to me. And I also agree, Doug that hope is absolutely not a strategy. So Doug, thank you so much for coming on. Where can people learn more about you and elevation gold?

Unknown Speaker 20:19
Sure. It’s elevation gold. All one word.com It’s pretty easy. Yep. Perfect.

george grombacher 20:27
Well, if you enjoyed this as much as I did show Doug, your appreciation and share today’s show with a friend who also appreciates good ideas, go to Elevation gold.com And check out everything that they are working on and follow along with the progress of the moss mine here coming up in 2022. Thanks, good duck.

Unknown Speaker 20:47
Wonderful. Thanks so much for your time, George. It was a wonderful conversation,

george grombacher 20:51
enjoyed it as well. And until next time, keep fighting the good fight. We’re all in this together.

Transcribed by https://otter.ai

Thanks, as always for listening! If you got some value and enjoyed the show, please leave us a review wherever you listen and we’d be grateful if you’d subscribe as well.

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