Having a multi-property brownfield project portfolio, sponsorship and money in the bank, puts Cartier in an ideal position to benefit from a rising gold price moving forward.

Philippe Cloutier

CEO, CARTIER RESOURCES

February 25, 2019

Can you give a brief overview of Cartier Resources and the company’s flagship project?

Cartier Resources is a junior gold exploration company focused exclusively on the Abitibi greenstone belt in Quebec. The company’s business model, although relatively simple, is anchored in a time-tested approach of adding value through exploration. We have built a portfolio of projects that have historical resource estimates. These estimates are not 43-101 compliant, simply because drilling that followed discovery was completed prior to the 1997 Bre-X Minerals scandal. The 43-101 national instrument for the standards of disclosure for mineral project within Canada only came to light in 2001.

Cartier’s signature business model was to acquire projects that had demonstrated their mineralized endowment at a time when drilling was conducted within a 0m to 250 m range. The company’s strategy, once having acquired these projects, was to upgrade the database into a digital platform to better understand the characteristics of the mineralization in order to design an appropriate and modern exploration program. We aim to explore the geometric extensions of the deposits.

In 2016, Agnico Eagle took an interest in Cartier Resources as they liked our robust and simple business model. They saw that we were on the verge of in-depth exploration on our deposits and, fortunately, they wanted to sponsor our drilling activities. In December 2016, Agnico Eagle took a 19.9% interest in our shares for an investment of C$16 million. Subsequently, JP Morgan UK took a 9.9% interest in Cartier Resources. This gave us significant publicity which attracted various other investment interests and, by the end of 2017, the company had C$16 million.

Concurrently, we launched an aggressive diamond drilling program on our Chimo deposit. We also drilled two other projects, but Chimo started rewarding us with consistent results and we felt that, if we were truly going to move one project towards mine status, we would have to focus only on the Chimo project. The Chimo project quickly went from a 15,000 m drilling program to now having approximately 50,000 m from 120 holes. All of the holes were drilled within a 500 m radius of the shaft,, and we had two machines drilling around the shaft and two machines drilling deep beneath the historic main mine lands. In all, there were 23 individual mineralized zones to be explored at depth and we were very successful in demonstrating that all of the mineralized zones extended depth.

We realized that we would have to prioritize and we thus launched a phase two program to focus on only seven of the 23 zones. Currently, three of the seven zones have actually emerged as significant as they fundamentally tip the project. We hope to bring a maiden resource calculation to market in the near future. The resource estimate aims to show that Chimo mine could go back into production for the fourth time.

As there is a vast history on the property, the Chimo project is well established and in order. Is this reflected in Cartier Resources’ share prices?

The market does not appreciate brownfield projects the way it should, and the value of the project has not been reflected in our share price. The value has not even been reflected within our peer group of investors as, although we have exceeded expectations on the technical level, we have not been very focused on marketing. We have to educate the market on brownfield projects and explain the value proposition that these projects can hold.

Chimo is a past producing mine, which means that we have all the past production statistics, the metallurgical recoveries, the rock mechanics and a very good handle on the structural and metalogenic controls of the ore. It is a project which benefits from a significant amount of data, which is generally the costly part of the project. The environmental aspect is also minimal to a great extent. Chimo is also within a 50 km drive from numerous mills which are all under capacity, meaning that the potential ore can be shipped to any of the mills, eliminating the need to construct a facility and minimizing the environmental impact. There lies a substantial amount of value in rehabilitating an old mine as it has historical information, it is close to infrastructure and a qualified workforce, and there is no anticipated environmental or social pushback.

Will the investment from Agnico Eagle and JP Morgan be used to get the mine into production?

The investment funds of Agnico Eagle and JP Morgan is mainly for exploration, but we still have approximately C$8 million in the bank. We are not adverse to raising money as it will enable us to keep adding value to the project. Part of our business model is to monetize Cartier Resources’ assets to the benefit our shareholders.

Do you have a final message for our international readership?

The objective is always for Cartier Resources to be the preferred name within the industry. The end game in our business is to provide the industry with the gold ounces, as that is how we believe value is created. If you take as much risk out of the equation as you can, you are more likely to reward your investors. The Chimo Mine project, for us, offers the lowest risk highest reward situation. Having a multi-property brownfield project portfolio, sponsorship and money in the bank, puts Cartier in an ideal position to benefit from a rising gold price moving forward.  

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