Impressed with Goldquest

POSTED ON October 15, 2015 BY Tommy Humphreys
CATEGORY Goldquest Mining,

Chairman Bill Fisher presents GoldQuest $GQC in Vancouver on October 14, 2015

Yesterday, Goldquest Mining Corp. Executive Chairman Bill Fisher presented in Vancouver and Eric Coffin, editor of the Hard Rock Advisory newsletter and a close follower of the company, encouraged us to attend.

Note: Mr. Fisher's comments about Goldquest were made in a "Forward-Looking" context. This means they may not come true, and are subject to a number of risks which are discussed in Goldquest's profile on www.SEDAR.com. Additionally, this publication may contain errors. Junior mining shares like Goldquest are about as risky and volatile as securities get. Always do your own due diligence and talk to a licensed investment advisor prior to making any investment decision. Only you are responsible for your trades.

Chat thread from Bill Fisher's Oct. 14, 2015 GQC presentation starts here.

The first thing you should know about Goldquest is the management team has an impressive track record of mine development in the Dominican Republic, where Goldquest's flagship Romero project is located. The same team built the producing Cerro de Maimon open-pit copper-gold mine from 2004-2008, on time and budget, and are familiar with the framework for advancing mines in the region. This should lend some credibility to their plans to build an underground mine at Romero.

Additionally, Fisher has been involved with some spectacular exploration successes. He was executive chairman at Aurelian Resources, which found the Fruta Del Norte deposit in Ecuador now being developed by Lundin Gold. Shares in the junior explorer soared from pennies to $40 per share on the back of that find. I found Mr. Fisher to be a well-spoken and confident presenter.

The next thing you should know about Goldquest is its Romero discovery in the Dominican Republic is a very compact and high-grade deposit. Fisher said Romero has yielded the best mineral exploration drill holes in the history of the Caribbean basin, including Mexico. According to a 2015 PEA, Romero has a $219-million NPV using a 6% discount rate and US$1225 gold. The proposed project has a 34% after-tax IRR and $572 all-in sustaining costs. A little over $143 million is required in pre-production capital. Payback is 2.7 years. The project will ramp to 150,000 ounces of annual production in years 3-4 for a 10-year mine life.

There is considerable exploration upside, according to Fisher. The current mine plan only uses about 34% of the indicated resource and Fisher believes at higher gold prices the remaining material will be attractive for future expansions. He also sees exploration potential throughout the company's 50-km land package. Goldquest has also recently announced an exploration alliance with Precipitate Gold, another explorer in the area with a new high-grade gold discovery. Fisher said it is highly unlikely, geologically, that they will find only one Romero.

Goldquest is raising $3.5 million now (11-cent units with three-year half warrant at 18 cents) and will come back to the market for about $7 million in early 2016, Fisher said. This will be adequate capital to publish a PFS in early 2016, secure surface rights, complete a full FS, and be a shovel-ready project.

The company's stock soared to $2 following the 2012 Romero discovery. Goldquest hasn't raised money since a $1.25 bought-deal financing. The shares now trade at pre-discovery levels, and I asked Coffin why he thought the company had been so discounted.

"I think its partially just the concern about having huge dilution to finance production," Mr. Coffin said. "I think there is concern about the DR too, although I don't share it. There was a bit of a pissing contest between the government and Barrick/Goldcorp on royalties and with Xstrata on permitting. GQC agrees with Xstrata but its become a political football for a number of reasons and the truth is that at current nickel prices there's no way they will expand the nickel laterite operation. ABX/G is a one-off. It was a disagreement about terms of the deal between the former government and former owner of Pueblo Viejo (Placer). That was a one-off deal - an auction, essentially. The DR has a well-defined mining code and good tax policy which is what applies to all the other projects there. It was Bill and Julio, the CEO, that permitted and built Cerro Maimon, which went pretty smoothly. One other important note that Bill harped on today is that Romero will be a copper concentrate producer. Bill knows that sector, having worked for Boliden. There is a lot of financial engineering that can be done with smelters and import-export banks when you have concentrate. They covered a big chunk of the bill for Cerro Maimon that way and will likely do the same with Romero."

Take a test drive of Eric Coffin's Hard Rock Advisory newsletter. Get the service for three months for only $9 here.

CEO.CA Chat thread from Mr. Fisher's presentation starts here.

Read Goldquest's corporate presentation here.

Goldquest Mining Corp $GQC.V
Shares outstanding: 145,955,044
Recent price: $0.115
Market cap: $16.785 million
Cash: $2,921,948 (June 30, 2015)
http://www.goldquestcorp.com/

Author holds no position in Goldquest at the time of writing but that may change without notice.

Forward Looking Statement

Statements contained on this website that are not historical facts are forward-looking information that involves known and unknown risks and uncertainties. Forward-looking statements in this presentation include, but are not limited to, statements with respect to the merits of the Company's mineral properties, mineral resource estimates, and the Company's plans, exploration programs and studies for its mineral properties, including the timing of such plans, programs and studies. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "has proven", "expects" or "does not expect", "is expected", "potential", "appears", "budget", "scheduled", "estimates", "forecasts", "at least", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "should", "might" or "will be taken", "occur" or "be achieved".

Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and other factors include, among others, risks related to uncertainties inherent in the estimation of mineral resources; commodity prices; changes in general economic conditions; market sentiment; currency exchange rates; the Company's ability to continue as a going concern; the Company's ability to raise funds through equity financings; risks inherent in mineral exploration; risks related to operations in foreign countries; future prices of metals; failure of equipment or processes to operate as anticipated; accidents, labor disputes and other risks of the mining industry; delays in obtaining governmental approvals; government regulation of mining operations; environmental risks; title disputes or claims; limitations on insurance coverage and the timing and possible outcome of litigation. Although the Company has attempted to identify important factors that could affect the Company and may cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, do not place undue reliance on forward-looking statements. All statements are made as of the date of this presentation and the Company is under no obligation to update or alter any forward-looking statements.

Forward-looking statements are based on assumptions that the Company believes to be reasonable, including expectations regarding mineral exploration and development costs; expected trends in mineral prices and currency exchange rates; the accuracy of the Company's current mineral resource estimates; that the Company's activities will be in accordance with the Company's public statements and stated goals; that there will be no material adverse change affecting the Company or its properties; that all required approvals will be obtained and that there will be no significant disruptions affecting the Company or its properties.

Mineral resources that are not mineral reserves do not have demonstrated economic viability. There is no certainty that the mineral resources will be categorized as mineral reserves.

Tommy Humphreys

Tommy Humphreys, 30, is an entrepreneur, investor and writer from Vancouver, Canada. He founded CEO.CA, a popular junior mining and Canadian finance blog, in 2012. He has been the president of Pacific Website Company Inc., a private marketing and web development company, since 2007. Tommy has authored articles for Globe and Mail, Financial Post and others. He speaks at select conferences. Reach him by email: tommy@ceo.ca. Follow him on Twitter: @TommyHump More →

Twitter: @tommyhump

tommyhump@gmail.com

Tommy Humphreys

Twitter: @tommyhump

tommyhump@gmail.com

Disclaimer:

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Forward-Looking Statements: This article may include certain "forward-looking information" within the meaning of Canadian securities legislation. Forward-looking statements include predictions, projections and forecasts and are often, but not always, identified by the use of words such as "seek", "anticipate", "believe", "plan", "estimate", "forecast", "expect", "potential", "project", "target", "schedule", budget" and "intend" and statements that an event or result "may", "will", "should", "could" or "might" occur or be achieved and other similar expressions and includes the negatives thereof. All statements other than statements of historical fact included in this release, including, without limitation, statements regarding the potential of the Company's properties are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are based on a number of material factors and assumptions. Important factors that could cause actual results to differ materially from Company's expectations include actual exploration results, changes in project parameters as plans continue to be refined, future metal prices, availability of capital and financing on acceptable terms, general economic, market or business conditions, uninsured risks, regulatory changes, delays or inability to receive required approvals, and other exploration or other risks detailed herein and from time to time in the filings made by the Company with securities regulators. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ from those described in forward-looking statements, there may be other factors that cause such actions, events or results to differ materially from those anticipated. There can be no assurance that forward-looking statements will prove to be accurate and accordingly readers are cautioned not to place undue reliance on forward-looking statements which speak only as of the date of this article. The Company disclaims any intention or obligation, except to the extent required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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