GSP Resource Corp. (TSXV:GSPR, OTCQB: GSRCF) CEO Simon Dyakowski

00;00;07;21 – 00;00;31;27

And welcome back to another episode of The Mind and Markets podcast hosted by Senergy Capital. Joining us today is the CEO of GSP Resource Corp., which trades on the venture exchange under symbol PR, Mr. Simon Koski. Simon, how are you? Hey, good daily. I’m doing great. Thanks for having me on the show today. The last time we spoke, I believe it was about your other company, Aztec, which is almost the big brother in this situation.

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And GSP is the infant which is making some serious strides, in my view. There’s a ton of potential upside here. One of my clients I was recently speaking with told me just yesterday, he said, Ali, you know, finding the right exploration company has to have three P’s, which is project people in place, which I think GSP represents quite well.

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The location is excellent. It’s just neighboring the largest copper mine in Canada known as the Highland Valley Copper mine. The team is experienced and the project itself is extremely attractive, not to mention the tiny market cap and extremely tight share structure, which of course is an added bonus. SIMON Let’s talk about the plans here for the remainder of 2023 going into the New Year.

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I know the company recently announced a new drill targets, which look exciting. What’s the objective here for drilling and the plan moving forward? Yeah, thanks. We do have a great project, great people, and we acquired this all Wood mine project back in 2020, and we’ve been working up the case to go and drill it now for the past year.

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We did do some limited drilling back in 2020 and 2021, had some good results, but then realized that we really needed to go ahead and consolidate some of the historic information associated with this project. So that’s really been the focus of the last 12 months from late last summer until today has been a data review, modeling and compilation.

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And what we found is over 60,000 meters of historic drill data, which we’ve now modeled, we can now verify the number of the old assay results, and it’s really given us a new look at this historic asset, which was only partially mined back in the early 1980s and early 1972 before being prematurely shut down due to a very short lived blip down in the copper price during the recession in the early eighties.

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So it’s had no mining since then. Really not a lot of meaningful work. And with copper being such a scarce resource, we thought this is really a good opportunity to go and have a second look. The project is located next to the largest copper mine in Canada known as the Highland Valley Mine, which is really important to point out, not just because that mine is operated by a giant multinational company, Teck Resources, but that we’re basically in a brownfields area of completely disturbed land.

00;02;46;20 – 00;03;07;28

And with the ESG landscape that we see in the world, these days, you know, it’s really a big advantage to be somewhere that’s not pristine, you know, has had industrial activity on it before so that we’re you know, we’re not proposing to wreck any new environment. It’s just really to build upon something that’s already been disturbed. So we’re really lucky in the location of the project.

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Touching a little bit on the team know we have an excellent technical team that we hired about a year ago that started doing this data review and compilation that’s led by Chris Raffel, a company called Apex Geoscience that has had a number of very well-known clients in the in the British Columbia mining exploration sector. We’ve recently added a new director, Rodney Stephens.

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He is a former award winning analyst from Salomon Partners. He was one of the top stock pickers in the bull market of 2006 seven, Where he went to Star Minority was the silver and lost insolvent part of their stock. And we have added a couple of geological advisors to the team, most notably David Pyle, over 40 years experience in the industry.

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He discovered multiple copper projects in the Americas and as well on our advisory team is Greg Dawson, who is currently VP of Sinclair Gold, which has been doing really well recently. So you know, the teams there, the projects there and we’ve been patient in getting the right game plan together for drilling, which is our intention for the fourth quarter of 2023 to go in and drill approximately 12 to 1500 meters at the Allwood Mine and fill in some knowledge gaps and hopefully expand on this project as well.

00;04;23;08 – 00;04;41;02

Okay. So you guys did some initial drilling back in 2020. So this this plan moving forward is to follow up on that drill campaign. Is that correct? It’s really to follow up on the new model that’s been reinterpreted. You know, we’ve identified some areas where we think we can find out the up and down plunge extensions of the mineralization, and that has not yet been drilled.

00;04;41;04 – 00;04;58;15

And also to continue to verify the historic dataset of 60,000 meters of drilling. So it’s a little bit of both. It’s some confirmation and some expansion drilling, which I think is a nice mix for this point of the development of this project. I know it’s a little bit hard to speculate, but what’s kind of the timeline for drilling this year?

00;04;58;22 – 00;05;15;14

So the timeline is to get going in the fourth quarter. October. November is a great time to be drilling up in the Highland Valley. It’s past the summer fire season and it’s before the really cold, snowy season in the winter. So it’ll be it’ll be this fourth quarter. Okay. I want to talk a little bit more about the location.

00;05;15;14 – 00;05;37;13

You know, is the end goal with GSP to be a potential out from Teck given that it’s right next door or you know what what do you see here with that The end goal is to make the shareholders money. We’d love to sell the project eventually, but we’re only about four or five going on right now, which is it’s peanuts for an established copper project in the mining friendly jurisdiction like British Columbia.

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So we don’t want to get ahead of ourselves. We don’t want to talk about selling anything too early. We really want to prove out and discover more in the interim and then ultimately monetize the asset for our shareholders. You know, who or in what format that transaction might take place. Is it still uncertain? Of course. It obviously doesn’t hurt to have a gigantic operator next door that’s ramping up production.

00;05;59;17 – 00;06;21;25

But, you know, there’s many, many options, especially in B.C., if you have a good high grade copper project. And is it the case that, you know, Teck might be expanding their footprint and, you know, looking at other projects nearby, has that happened historically, or is this kind of something that you’re you’re kind of anticipating? Well, no. We’ve seen in their filings that they’re expanding their valley pit, which is directly adjacent to us.

00;06;21;25 – 00;06;41;26

They’re they’re pushing it out in our direction so that, you know, that’s known how far they want to push that out going forward in the future, We don’t know. But it’s certainly it’s positive that it’s coming into our direction and we don’t really know if our Islwyn mine project is just an extension of that mine or if it’s something deeper and bigger beneath the mine that we already know about.

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So, you know, it’s still early days in exploring this thing. But again, just being so close to an expanding mine, obviously expanding in our direction certainly adds an element of excitement to the story. Right. And you guys, for the upcoming drill program, do you guys have the cash to do it or are you guys going to do a raise soon?

00;06;58;06 – 00;07;14;28

What’s that looking like? Yeah, we recently did a raise of just under 400 grams, so it’s given us sufficient working capital for the next couple quarters here. And then, you know, we’ll we’ll look if there is an attractive option to raise a little bit more money, we might. But, you know, nothing that will hurt the share structure too much at this point.

00;07;14;28 – 00;07;32;27

That’s that’s our goal plan or game plan. And our goal is to preserve the, you know, the tight nature of the share structure. I mean, the stock’s been moving quite well the last few days here. And really I think that’s due to the fact that we’ve been patient. You know, we haven’t issued too many cheap shares in the past.

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You know, we’ve waited to get the right model to have the right timing to go ahead and do this drill program. So, you know, we’re certainly not anticipating, you know, any sort of hugely dilutive financing to, you know, in the next near future. Right now that we’re on the topic, let’s talk a little bit about the share structure.

00;07;51;23 – 00;08;10;00

I know that it’s extremely tight and well put together. Can you touch upon this a little bit? Yeah. So the company was taken public at $0.20 a couple of years ago, which is right around where we’re training right now. So we’re at the IPO price. There’s only been a couple of really small financings below this price, you know, one three years ago at $0.50.

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And then obviously the one a few months ago at $0.12. But that’s still locked up for a couple of months. And it was modest, you know, mostly taken by investors that are really close with the company. So, you know, we certainly don’t anticipate too much selling coming out of that camp. And you know, 26 million shares out is minimal for a property of this stage.

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And to add to that, we have over 30% of our shares are currently locked up by insiders

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So, you know, really strong insider ownership on this on this company, which we’ve been very deliberate in preserving over the past couple of years. Right. Let’s switch a little bit. I want to talk more about the macro story with copper.

00;08;46;13 – 00;09;02;21

You know, it seems that the supply and the demand is expected to grow further, wiser price disconnect because, you know, I always keep seeing on the news and I keep reading about, you know, there’s just simply not enough supply of copper. And recently it’s become a U.S. critical mineral. This took quite a long time. What do you think about this?

00;09;02;27 – 00;09;34;03

Yeah, I mean, there’s obviously a disconnect between the big supply gap that’s looming and the recent trading in the copper price. You mean? I would point out that if you look over a five or ten year period, copper is trading at a very healthy level. And although it’s had a bit of a correction over the past 12 to 18 months, most likely due to the slowdown in China, you know, the Chinese government is now reportedly adding stimulus to their economy and that’s typically a big driver of the copper story is having good growth over over in Asia.

00;09;34;06 – 00;10;03;13

So that seems to be turning around. And then, of course, there’s a lot of new mines being built, which as the, you know, the metal refiners work through their stockpiles. They just try to find new sources from the mines that are being built and simply through the laws of economics, the basic, you know, laws of supply and demand, you know, there’s a very, very positive outlook for for copper, you know, the battery metals in general, copper being a very important part of, you know, further electrical grid buildout.

00;10;03;15 – 00;10;22;27

So while it’s been tough over the past two years, I think it’s a temporary blip. And, you know, we we seem to be back on track, at least recently. The price of copper has recovered quite nicely over the past few months. And, you know, at this point, that’s a very positive signal for us. Nobody can tell the future, of course, But you know, the trend can be your friend.

00;10;22;27 – 00;10;43;29

And the trend is definitely, you know, our friend in recent weeks, given that there needs to be more supply. And I think there’s, you know, a big emphasis on North American Juniors, you know, becoming producers, Do you see any government funding on the horizon for for GSP resource? Well, that’s not something we’ve explored yet. And the reason for that is, you know, you typically look for that in terms of development.

00;10;43;29 – 00;11;04;21

So, you know, we still think there’s, you know, enormous exploration upside on this project. So we want to you know, we really want to focus on the exploration discovery before thinking about any development plans. But one thing that the government has done recently is added copper to the list of critical mineral elements that are obtained, favorable tax status in the in exploration expenditure.

00;11;04;22 – 00;11;25;18

So that’s you know, that’s definitely positive for companies located in British Columbia and Canada in general. Is that you know, there is good support from that perspective. And then, you know, hopefully there’s more as these projects become more advanced. And, you know, I kind of assets earlier, But why do you think it’s recently become a critical mineral? You know, because I think before back in the day, it was mostly industrial copper was used there.

00;11;25;18 – 00;11;49;26

People now realizing the need for copper with electrification and clean energy. How come it takes so long? You know, I think copper has always been obviously, you know, copper wiring is a key element of transmitting electricity and there’s been a push recently to to increase the electrical grid. So the reason that it’s been classified as critical is that there is a critical need to find more copper to support the build out of the grid.

00;11;49;26 – 00;12;09;16

Whereas, you know, before there there was a better clarity, I think, on demand supply coming on. So so classifying it as critical just kind of highlights that, you know, more needs to be found fast and put in production versus the historic cycle of these assets. Right. Great. Simon, thanks so much. If there’s any other catalysts coming up, now’s the time.

00;12;09;23 – 00;12;27;12

Absolutely. So the catalysts coming up for us are the start up of drilling, you know, further plans on the drilling. We will endeavor to keep our shareholders and prospective shareholders, you know, as up to date as we can as it relates to, you know, drilling, mobilizing the start up, you know, the completion of certain holes, the results thereafter.

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And then we continue to grow and continue to discover. So plenty of catalysts. The news flow cycle hasn’t even really kicked off yet. You know, we had news a couple of weeks ago highlighting our plans. Obviously, some investors became quite excited about that. And I think as we continue to execute on these plans, we should have more opportunities to highlight the compelling proposition of this project and company two to the market.

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Perfect. I’m looking forward to the news float and I wish you guys the best of luck. Thanks again for your time today. SIMON Well, likewise. Thank you very much.