NewPeak Metals is focused on its 100%-owned Las Opeñas gold project in San Juan, Argentina. The project is about 70 km southeast of Barrick and Shandong’s Veladero mine, in the El Indio belt. Teck and Genesis Minerals both explored it in the past. In this interview, I asked asked him about the project’s history, why he thinks Teck and Genesis missed what NewPeak is now chasing, what success looks like in the pending results, and how he plans to fund the next steps without wrecking the share structure, as well as time, money, and risks.
TL;DR
NewPeak has found a big but low-grade gold-zinc-silver breccia system, and it is now drilling west for a higher-grade gold core. Phase 2 drilling just finished, and assays are expected by year end. Mark told me the stock works only if they find higher grade. If they don’t, he said they’ll drop the project and look for another one in Argentina. With about A$1.6 million in the bank and a drill bill still to pay, funding is the main overhang either way.
What have they done for shareholders lately?
They bought out the JV partner to get 100% of the permits. They then drilled six diamond holes for about 2,500 m, with a best hole of 663 m at 0.41 g/t gold equivalent. Less than 40% of that value is gold; zinc makes up much of the rest. Mark said gold grades rise toward what they think is the centre of the breccia, and the best gold sits in the top 200 m or so. He also said the system is mineralized down to 600 m and the breccia maps at about 800 by 600 m at surface. Mark has put about A$120,000 of his own cash into the stock, A$100,000 on market and A$20,000 in the placement, for about 6.7 million shares at an average cost of roughly 1.7 to 1.8 cents. He also holds 23 million performance rights that vest only if the 10-day VWAP reaches 5 and 7 cents. Board and management own about 19%, or 25 to 26% if you add Neil Stuart. A new 10.6% holder came in through the last placement.
How much money do they have and what are they spending it on?
They had A$1.6 million in cash at 30 September, but the Phase 2 drilling invoice hasn’t been paid yet. Mark said all-in drilling costs run about A$900 to A$1,000 per metre because the holes are deep. They also hold about 3.5 million shares of an ASX-listed oil and gas company, worth around A$900,000 at spot, and they have sold some of those over the past year. G&A is about A$100,000 a month. More than half of that goes to Mark and Alistair, and roughly A$15,000 goes to marketing. Mark’s salary is A$300,000, and he said the rest of last year’s reported pay was the accounting value of equity incentives that never paid out. The last raise was A$3.5 million at 1.3 cents in August, which came with options exercisable at 2 cents. When I pointed out that raising A$2 million at this market cap would grow the share count by about 50%, Mark said the real answer is a discovery that lifts the share price. He is open to a JV on Las Opeñas and wants to sell or monetize the non-core assets.
Upcoming catalysts
The big one is Phase 2 assays from Las Opeñas. Mark wants them by the end of the year and would love early December, but he said labs have never once delivered on time for him. He told me success would be grades around 1 g/t gold over much more than 10 m, ideally over the long widths they already see. If results are good, the next steps are more geophysics over the breccia, another drill program, early metallurgical testing and possibly a resource. Beyond that, he expects to try to monetize the existing non-core assets: the Queensland gold project, the uranium ground, and a 35% Argentine farm-in where NewPeak pays 100% of exploration. He may also bring in a new Argentine project. When I asked about deposit size, he guessed 2 to 3 million ounces, which he called “finger in the air territory.”
Risks
The main risk is geological. If the higher-grade core isn’t there, that could be the end of this project, according to Mark himself. IP picks up both the zinc and the gold phases, so it can’t tell the two apart, and Phase 2 is drilling a structure up a gully rather than a clear gold signature. Financing at a sub-A$4 million market cap means heavy dilution unless results re-rate the stock, and Mark couldn’t put numbers on Phase 3 or a replacement project. There is no metallurgical work yet. Teck holds a 2% NSR. Genesis walked away after drilling nearby holes, and Mark guesses it’s because Argentina was harder to work in back then, and those grades weren’t attractive at the time. The site sits at about 3,200 m, and they lost only about two weeks of access this year.
NewPeak Metals CEO Interview
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