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Provenance Gold has started a large drill program at its Eldorado project in eastern Oregon, with CEO Rauno Perttu emphasizing a pragmatic and experienced approach to exploration. The company believes its assets are significantly undervalued, partly due to lingering misconceptions about Oregon’s mining viability. Provenance has raised $10 million to date and is conducting a 10,000-meter RC drill program to verify and expand a historic 2-million-ounce gold estimate. Though not ready to joint venture, the company anticipates eventual acquisition interest.
TL;DR
- 1. Provenance Gold has started its largest drill program ever in Oregon to expand on a historic 2-million-ounce gold resource.
- 2. CEO Rauno Perttu brings nearly five decades of geological and business experience to the helm.
- 3. The company is operating in a newly mining-friendly Oregon regulatory environment, especially in the east.
- 4. Provenance’s exploration is focused on low-cost, high-efficiency RC drilling with bulk tonnage potential.
- 5. The company believes its share price does not yet reflect the full scale and quality of its Eldorado project.
Is this the right CEO for Provenance Gold?
Rauno Perttu brings nearly five decades of global geological experience, having worked across North and South America and Australia. As a registered engineering geologist in Oregon, he previously held senior roles in major mining firms, including a stint as Director of Business
Development at Kennecott. Perttu emphasized his strategic approach to project selection, stating, “I always prefer to be in that most economic portion because it’s going to be the best news for the shareholders.”
Has Rauno made money for shareholders before?
Perttu says he has been directly involved in multi-billion dollar value creation.
Notably, he led BP/ Kennecott to invest in a high-fluidity coal project in Australia that has yielded billions over the years. Conversely, he halted a molybdenum project in Alaska just before a price collapse, preventing losses. “You don’t do geology for the sake of geology,” he noted. “You do it to enhance the business.”
Has the technical team made money for shareholders before?
Provenance uses a lean consulting model, hiring seasoned professionals like Randy Vance for drill management and Ben Hinkle for 3D modeling.
Perttu noted, “They only get paid when they’re working,” highlighting cost efficiency. These consultants have prior experience with similar intrusive-hosted systems in the U.S., and a third geologist was recently added to assist field operations.
How many shares does the CEO own?
Insiders hold about 8% of the company, with Perttu, Rob Clark, and Tom Martin each owning just over 3 million shares. The remainder of insider ownership comes from long-term backers, including family and professional contacts. “We started with those shares at 10 cents,” Perttu explained.
Did insiders pay for their shares?
Yes, insiders purchased their initial shares at $0.10.
While Perttu has not significantly increased his position due to financial limitations, he has encouraged investment from friends and family, stating, “I am completely confident this project is going to do very, very well.”
Do insiders hold a royalty on the projects?
No. “We would not go that route,” said Perttu.
He emphasized that neither he nor any other insiders hold royalties on Provenance assets, which aligns with investor expectations for transparency and aligned incentives.
How is executive compensation determined?
Executive salaries are not tied to key performance indicators.
“We’re only taking salary as needed to keep on living day-to-day,” Perttu said. He added that future compensation is tied to the company’s success via share appreciation.
How workable is Oregon really?
Oregon’s eastern region has become significantly more mining-friendly.
“Eastern Oregon is a semi- desert with sparse population,” Perttu explained, noting strong local support due to potential economic benefits. Changes in political leadership have further improved the regulatory outlook, culminating in state and federal backing for mining development.
How does the permitting process in Oregon work?
For exploration projects, permitting is streamlined. “We submit plans for up to five acres of disturbance,” Perttu said. Vehicle-based drilling avoids road building, saving space and simplifying approval. The main regulatory body, DOGAMI, has final say, with permits typically processed within 60 days.
Why aren’t there more explorers in Oregon?
“It’s a perception issue,” Perttu explained.
He believes outdated views of Oregon as anti-mining still persist, but major players are beginning to recognize the opportunity. “Some majors have quietly done their homework and are now exploring,” he said.
How did Provenance get Eldorado in the first place?
The project was referred to Provenance by Jerry Baughman of Gold Royalty Corp. With 242 historic drill holes and a non-compliant 2-million-ounce gold estimate, the asset immediately stood out. “It took us about three minutes to say we want that project,” Perttu recalled.
How much money have they raised since 2023?
Provenance has raised approximately $10 million since acquiring its key assets, with $1.5 million currently on hand. Despite challenging markets, the company has attracted steady support, which Perttu attributes to the quality of the Eldorado project.
What’s the exit strategy for PAU?
The goal is to develop the project as if it will go to production, but Perttu anticipates acquisition interest.
“El Dorado East is the single best exploration target in Oregon,” he said, asserting the company will only consider deals that reflect its growing value.
Why drill RC instead of diamond again?
RC drilling is more efficient for bulk-tonnage systems and significantly cheaper. “RC costs us $150- $160 per meter, while core was over $500,” said Perttu. RC also provides better gold recovery in the region’s variably hard and soft rock.
Do they properly understand the structure?
Yes. The team has mapped key northeast-trending structures and identified diorite intrusions that host mineralization.
“We understand where the gold came from and how it got there,” Perttu said, noting that structural insights guide their drill targeting.
Would the nugget-effect be a problem?
Yes, but it’s being managed with photon assays, which test 500-gram samples to reduce statistical variance. “The nugget effect is normally a problem that will help us raise the grade,” Perttu explained, citing past experience in Montana.
When will they be doing more metallurgical work?
Metallurgical testing is ongoing. The company has transitioned to photon assays for early results and plans additional bulk testing to validate gold recoveries. “We can run several [500-gram] tests per sample and blend the results,” said Perttu.
Is there refractory risk?
No significant risk has been identified. Historic and current tests show high recoveries, with much of the gold occurring as free particles. “We can actually see visible gold that’s completely exposed,” Perttu noted.
Is the diorite the host or the source?
The diorite is believed to be both. “The gold is always associated with proximity to the diorite,” Perttu said, explaining that fluids from the intrusion precipitate gold into surrounding carbonaceous shales.
How deep will they drill?
RC drilling has already reached 250 meters, with core drilling planned to go deeper. “We now know we need core holes to explore deeper,” Perttu confirmed, targeting structures dipping at angles favorable to accessible drilling.
When are the assays coming?
Samples are collected weekly, and results are expected imminently. “Paragon Labs picks them up from site. Turnaround can be just a few days,” Perttu said, adding that results will guide future drill targeting.
What would they consider ‘success’?
Perttu defines success as confirming and expanding the historic resource with higher grades and larger footprint. “We want to expand our resource base and establish high-grade target areas,” he said, citing newly exposed structures from a recent wildfire.
When do they have to raise again?
A capital raise is planned but not urgent. “We have enough to keep drilling until the raise,” Perttu noted. The timing will depend on valuation and market conditions.
Do they want to do a JV now?
No. “We’re not ready to move forward in that arena,” said Perttu, noting that Provenance aims to first increase corporate value. Offers have been received, but none yet meet their criteria.
Why is the share price not going up?
Perttu believes outdated perceptions of Oregon and low investor awareness are to blame. “We think recognition will come with results,” he said, noting that institutions are asking the same question.
When will they do an MRE?
No date has been set. “We may not publish a resource until we can clearly label it as interim,” said Perttu. He worries a premature estimate could undervalue a much larger system.
Are they spending more money on marketing?
Yes. “We need to better communicate that we have a high-grade, more profitable project,” Perttu said. Marketing spend is expected to continue, subject to budget.
Do the locals want exploration and mining?
Yes. While there is no immediate local community, support from nearby towns and county officials is strong. “These jobs will more than double the average salary in that county,” said Perttu.
What are institutional investors asking?
The primary concern remains Oregon’s permitting environment. “That’s been answered pretty dramatically recently,” said Perttu, but admitted that perception takes time to shift.
Will they be twinning holes?
Possibly. Consultants disagree on how many twinned holes are needed, but Provenance’s results have exceeded historical values. Perttu expects integration into a future resource will be straightforward.
Why pick up more land?
The newly acquired Eldorado East includes numerous historic high-grade mines. “Sunday Hill is going to be a big hole in the ground,” said Perttu. The land package now totals 32 km2 and contains multiple drill-ready targets.
Is topography a challenge?
Topography at the expanded Eldorado property has not proven to be a significant obstacle. According to Perttu, while parts of the newly acquired land extend into hillier terrain, especially to the north, the area remains manageable for exploration. “Not really,” he replied when asked if the landscape posed challenges, indicating that the team has sufficient access and infrastructure to proceed with exploration effectively.
Is the new target part of the Eldorado system?
Yes, the new target area is called Eldorado East and it iss believed to be a continuation of the broader Eldorado gold system. Perttu described it as having a strong geological connection to Eldorado West, stating, “It all fits into this break pattern,” referring to the major northeast-trending structural zone. He emphasized the potential, saying, “We now have the best exploration property and the most advanced property in a whole new district.”
What are the next steps for the new land?
Provenance plans to begin drilling at Eldorado East before winter. Perttu explained that a 17 hole drill plan is being submitted imminently, and the company aims to get some holes into the ground
by September or October. “We have our next permit in that 60-day clock right now,” he said. Initial sampling has already been done, and the company is waiting on assay results from 13 samples collected from the Sunday Hill area.
What is happening right now?
“We are continuing to advance the original project we talked about before,” Perttu explained. “I think that is going to become a significant. I’m going to call it a new discovery even though it was built historically, simply because we’ve improved the grade and the footprint and the depth.” These improvements, Perttu believes, position the project to eventually become “a multi-million ounce mine at some point in the future.” Also nearby site El Dorado East is described as “a dream come true for an old geologist,” highlighting its special significance. “I think that is going to be special”.
What keeps him up at night?
Perrtu explained that he approaches projects by identifying potential red flags early on and only advancing once major hurdles are addressed. He stated that from a political perspective, he is not currently worried about opposition in Oregon, as the region remains supportive of development.
However, his main concern lies in how individual drill results are interpreted. He cautioned against focusing too much on single drill holes, noting that even in well-managed projects, one in three or four drill holes may yield poor results. This, he said, can lead to premature negative judgments about the entire project.
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