Pitch Battle: BeMetals vs. E79 Resources

0:08 Well, hello, everyone, and welcome to this highly anticipated pitch battle between 2 former colleagues. And now here they are competing in the ring. We have with nearly 30 years of experience in mineral exploration, capital markets, corporate development and investor relations, E79 Resources President and CEO, Patrick Donnelly. And with over 18 years of experience and has been involved in over 20 mergers and acquisitions and property divestitures, we have B Metals VP of Investor Relations and Corporate Development, Derek Iwanakwa. Hey. Welcome, everybody. So how is this going to work is we'll be asking a series of questions and both these contestants will have 2 minutes to answer. Once we get through all of the rounds, you can decide who won by writing in the chat. And of course, feel free to submit your own questions

1:01 at any time throughout by using the Q&A tab on the right-hand side of the screen. All right, so let's kick it off. I'm gonna get the timer ready. First question. First question here is, What is the most unique aspect about your team compared to your opponent? I'm going to send it over to you, Patrick, to kick it off, starting the clock now.

1:26 Yeah, I think the most important thing about our team is the fact that Most of them are at site and live at site. Our projects are in the state of Victoria in Australia. Our technical team is led by Shane Malley, who's from the area. We also have a contingent of geologists and other geoscientists that have decades of exploration in Victorian geology. One thing we have that's really nice is our projects are a 10-minute drive from the local town, So our GEOs and technical people sleep in their own beds every night as opposed to in many cases, you know, having to fly out to Western Australia. So I think that's how we're able to attract really good people.

2:13 And Australia is a fantastic place because, you know, it's got such a deep talent pool and we're very fortunate to have that. Great, thank you. And now your turn, Derek, I'm gonna restart the clock and here you go.

2:31 Okay, thank you. I mean, Patrick's team has a lot of experience, obviously, Patrick himself does, but, you know, looking at our team and our, especially our founding group of directors, officers, advisors, we have probably a record second to none really. If you look at the collective team, we've discovered over 36 million ounces of gold, 56 million ounces of silver, 6 billion pounds of copper, and collectively have raised over $5 billion Canadian. That's not obviously just me, but that's our collective group, which would include one of our directors, Clive Johnson, Tom Gerrigan, Roger Richet, Mark Conley,

3:09 all have tremendous experience. So I think that would set us apart from almost any company out there. And collectively, on the technical side, they've either constructed or operated 10 mines around the world globally. So if you put all those stats together, that means they've produced over 9 million ounces of gold and generated over $15 billion in gold revenue sales. So it's probably one of the best records out there. Great, thank you. Moving on to round 2. Why does the jurisdiction you operate in present a better opportunity?

3:46 I'm gonna pass it over to you, Derek, starting the clock. Well, I mean Australia is a great place. I've actually done some work in Kambalda, at a nickel mine there, and Australia is a terrific area to be operating. But what I like about Japan is when you arrive in Japan, there are no other companies out there. Unlike Australia, where you have a very well-known mining jurisdiction,

4:16 you have tons of competition over there. In Japan, there are literally only 3 companies that are operating, at least foreign companies that are actively exploring over there. Each one of us is backed by a major. So we have, in our case, B2Gold that's supporting us. And then we have 2 others, Newmont and Barrick. So some of the largest companies are backing us explorers in Japan. That's probably saying something for the pedigree of the area. And then what is probably not well known is Japan hosts one of the highest grade gold mines in the world, the Hishikari gold mines, like a textbook example of an epithermal gold system that is extremely high grade, has been producing 3 decades now, and I think it's getting close to 9 million ounces of gold produced there an average head grade of over 20 grams per ton. So it's certainly one of the best places to be active in today.

5:09 And it's very under explored. It really hasn't seen modern exploration since World War II. Thank you. Patrick, what about your jurisdiction?

5:21 Well, we're in the state of Victoria in Australia, and specifically, we're in the Victorian gold fields, which has yielded over 80 million ounces of gold. And the flagship asset in this jurisdiction is the Fosterville mine, which is owned by Nico Eagle. And they made a major discovery in 2016

5:41 at Fosterville, specifically the Swan Zone, where they delineated over 3 million tons, grading over an ounce. And so that's really opened up the whole region. This region is known for very, very high grade gold deposits. Again, multi-ounce, multi-million ounce, multi-ounce grades. And so, and again, Fosterville, I think it was last year, produced over 600,000 ounces a year at a cash cost. I think it was around $300 an ounce, which is astronomical. In terms of being in the right country for assets, it's great. And Victoria has got a very straightforward, well-utilized permitting system and goes from exploration drilling to development and operation.

6:31 Because of that, it's a great place to work. It's probably the safest jurisdiction in the world. And Australia in itself is a mining country and frequently, almost always, is ranked number 1 in the

6:45 world. And then again, as I mentioned before, getting good people is incredible. There's a deep talent pool of people there and Australians are mind builders. They're great geologists. And so, yeah, I don't think it'd be any, I think it's probably the best place in the world to explore for and develop a project. All right, thank you very much. All right, what are each of you doing to generate the most value for your shareholders? I'm gonna throw it to you, Patrick. Well, for me, and this is my bias,

7:18 my background, I'm a geologist and I've always believed in adding value to the drill bit and that's why I joined this company. We have 2 large properties that are dripping with Gold basically. Every penny we have, we try to put all our money into the drill bit. In our third hole we drilled there, we drilled 11m of 160g and subsequently we had other intercepts of about

7:49 2m or 3m of 40g, 20g to 30g, 40g and we had numerous holes like that. It's a simple story, just drill. This area produced, our property produced over 5 million ounces of gold historically, and they stopped mining in World War I, and only drilled, only mined down to the water table. And so we're just following up with the drill bit. And I think that's number 1 way to add value and I think that's what the market recognizes when you put that out.

8:24 Great. Thank you. Derek, what are you doing to generate the most value for your shareholders? I have to admit, I can't agree with Patrick anymore. We've put most of our money towards the drill bit as well. And for us, we're drilling in Japan as we speak. I was just in Japan a couple of weeks ago, watched the drill rig penetrating into the zone actually as I was leaving. So really interesting geology. The grades that we're seeing have been hitting, or sorry, the intersections have been hitting right where we expected. Our first hole, We've only released 2 holes so far, but the first one was 11 and a half meters at 6.42 grams per ton, and then another intersection at 8.7 meters at 7.8 grams per ton.

9:13 We are stepping out, sorry, not stepping out, but we're actually further down the strike, about 300 meters down from the last 2 holes. I think if we can intersect in 1 or both of the next holes, we could really seriously extend the strike length of that vein that we've so far discovered. And this could really turn into something that could become a deposit, I think fairly easy because the grade is so high.

9:44 So it's really exciting times. The next couple of holes could really kind of determine the fate of that particular project. I mean we still have other targets but I think these 2 are particularly interesting for us. So you know I like I said I agree with that. We're delivering the most value at the drill bit, or sorry, with the drill bit. Right, thank you so much. All right, next question is, in what ways is your asset superior to other assets in your commodity type? I'm gonna throw it back to you, Derek, to kick it off. Yeah, so the Kato project is one of those typical low-sulfide. I mean, we have a geologist actually on here, so I'm sure Pat could give you more details. But it's a classic low-sulfide epithermal vein target.

10:38 We are seeing everything that you would typically see. We have Sinter at the top. We have Cinnabar that we're finding near the surface as well. We're going down,

10:50 we're hitting high-grade veins throughout the last 2 holes that we've done, and hopefully this last hole that just as I was leaving Japan, they were getting into the zone there. So

11:03 it's one of those places where it hasn't seen modern exploration for so many years. The country really just opened in 2012 to foreign companies. And so it's, yeah, it just has probably the best exploration potential out there because it has seen so little activity. What was nice about our particular projects are, you know, because nobody else has been actively mining these things, none of them have royalties, everything is clean. So you're basically on almost like virgin ground whenever you get to some of these properties, although all of our properties are generally near past producing mines. So not necessarily on our property, but very close to our property. So there's been a lot of mining in the area, but not for almost a century in some cases at our projects.

11:56 So yeah, really exciting. Great, Thank you. Same question to you, Patrick. In what ways is your asset superior to other assets? Well, as I mentioned before, the Myrtleford project, which is over 40 kilometers long, it's a very large land package. It's yielded over 5 million ounces of gold. And Most of this Gold was recovered between the late 1800s and WWI. The old timers were mostly extracting it basically with pickaxes and shovels. What's really fascinating is they only mined down to the water table. They just picked everything at the surface. It's already yielded a lot of Gold. Since World War I, there hasn't been anybody there.

12:41 Nobody's been there with drills or anything. We're the first company to go in there and do a very systematic drilling program. As I mentioned before, we've already had some incredible drill results. The other thing is access. We're about a 20-minute drive to the local town of Beechworth, which is a few thousand people, and we're about a 3-hour drive to Melbourne. Unlike, as I mentioned, I'm a geologist, most of my experience is in Northern Canada where we're flying around in helicopters and having camps. In this case, we're 10 minutes to town and we can have a beer. And also the Australian dollar is very, very favourable. It's very, you know, drilling costs, our direct drilling costs are $150 a metre and all lands are around $225 CAD. So Very, very cheap costs.

13:32 A property that has had very little systemic expiration and it's already yielded millions of ounces of gold. And we're going after the low hanging fruit. So it's an incredible opportunity for us and our shareholders. Great, thank you so much. All right, for both of you, where do you think prices are going with your respective commodity? I'm gonna pass it to you, Patrick, to start. So I'll talk about gold. And right now I'm in Zurich. I just saw Pierre Lassonde give a presentation. And obviously he's very, very bullish on gold. And what was really interesting, what he said was the price of gold is 80% correlated with the US dollar. And so we've seen the US dollar hit very record highs, and that's going to come off, and that's going to be very, very good for gold.

14:25 And actually, gold prices have been holding it, compared to other asset classes during this tough times, gold's held up relatively well. And I think given that we're going, you know, we're dealing with inflation still and we're dealing with a very rocky economy, you know, and we've seen now the cryptos are crumbling, gold, it's shown its resilience. So I think the fundamentals, I'm not saying we're going to have $5,000 gold, I'm not crazy like that, but do I see gold being around $2,000? Absolutely. And I think there's a growing realization that to preserve your wealth, you need a portion of your portfolio in gold and obviously by extension gold equities.

15:12 So based on what I'm seeing and what people are saying. I'm pretty positive on the outlook for gold right now. Great. Same question to you, Derek. Where do you think prices are going with your respective commodities? Yeah, I mean, actually, our primary focus is gold, but since we also have exposure to copper, I'll speak to copper. And, you know, I guess for the outlook of copper, it is going to be quite dependent on how the economy evolves in China. But Just looking globally, if you look at the demand for copper, there's really no question, unless we go back to the dark ages, that any country that's developing is going to require additional infrastructure. Mature countries like United States, Canada, other places, if they're going to improve their infrastructure, which I know the United States is, that is also going to require a tremendous amount of copper.

16:09 So copper demand, I think, is going to be very strong going forward. You know, electric vehicles, there's different, I guess, views on the demand for that. But I mean, as I guess, as long as fuel prices continue to be extremely high, it's more and more customers or consumers are going to be going towards electric vehicles or at least hybrid vehicles like Patrick drives. So I mean, there's no question that's going to require a tremendous amount of copper. And so I think the future looks pretty bright for that space. Great, thank you very much. All right, this is my, before I ask my last question of the battle, if any attendees do have any questions of their own and they want to ask, now's your time to ask before we wrap it up. But in closing, to finish this pitch battle, What is the biggest goal for your respective companies in 2023?

17:05 And Derek, I'm going to start with you. 2023, I mean, our primary objective is really to make a discovery, whether it's gold in Japan or a copper deposit in Zambia. We have really good shots at both areas. We're gonna do about 2000 meters of drilling in Japan. And like I said, the first 2 holes hit, hopefully the next 3 or 4 hit as well. And then in Zambia, it's a really interesting area because I mean, you're basically in a very mature copper district, but we're on the very far western side of the Zambian Copper Belt where not a lot of exploration has been done. It's mostly covered by a thin layer, or in some cases, thick layer of Kalahari sand. So there's not a lot of exploration on the western side of the Zambian Copper Belt.

17:59 Everywhere we pretty much drilled has come up with some sort of copper anomalies. So there's, as they say, there's plenty of smoke. Hopefully there's a fire there somewhere. So, I think the, the, the potential of both areas are really good for us. Great. Thank you. Same question for you, Patrick. What is the biggest goal for your respective company in 2023? Right now, we've taken a break on drilling and we're just going through the results and come up with some geologic models, but eventually we'll go back and start drilling again. Like Derek, we've had some very good drill holes and yet we've got a large land package and there are some other areas that have high-grade showings literally sticking out of the ground.

18:47 So we want to hit those and like Derek said, make a big discovery. And I think we're close to doing that. So but anyway, yeah, it's you know, and we were well financed, you know, we have 6 million in cash and we can make that last for at least a couple of years. So, you know, we don't need to raise any money and hopefully have some positive news coming out soon. Great, thank you very much. That wraps up the battle portion. There are a couple questions from attendees, so I'm going to address those. 1 for you, Patrick, when do you expect drill results and when do you anticipate a financing? Yeah, well, as I mentioned, you know, we've gotten most of our drill results out and we'll probably have some more coming out soon.

19:41 And like I said, we don't need to raise money. And we're not interested in deluding ourselves, Management and the board and insiders, we own 20% of the stock. We're not going to blow up the share structure and we don't need to raise money. We're in a pretty good spot and like I said our operating costs are low. There's only 2 of us that are full-time in the company, myself and our VP of exploration, we have a part-time CFO. So you know my job is to keep that drill turning but also keep a close eye on the cash position. Thank you. Derek Howard is asking, will B2 Gold finance B metals until they buy it out? I can't speak for B2 as to whether they'll keep financing or eventually buy us out. But at least my understanding is that that's not their intention for us. We're kind of acting almost as their expiration arm right now.

20:40 And I think that if we continue to have expiration success, B2 will be there to back us. In August, they actually lent us 5 million US, which has worked out tremendously well since the US dollar has done quite well, especially in the last few months. So we don't require any financing for the, at least for another year or so, unless we decide to accelerate our programs, either in Japan or in Zambia. So I guess there is that caveat that that's a possibility, but that would be a great problem to have because that would mean we probably hit something good. So, don't require anything in terms of financing for the next months anyways.

21:26 And I can't say whether B2 will step in more than that, But I think they probably want to just keep their 19.9% interest in the company. And that makes things much easier, I think, for everybody. Great. Thank you. There's another question. I assume it's about operating in Japan. Fraser's asking, are there any language issues with the team there? Well, not for me. I am of Japanese background, so I actually do still speak Japanese. So it was actually great for me to go over there. Not too many people, I guess, in the mining world on the western side that have that experience, but I do. And we've been able to find geologists in Japan. It's been kind of a unique situation where we've picked up people that are not active in Japan, And then they found out that we were exploring in Japan and they sought us out and now are working for us.

22:24 So we found a few geologists like that. And we've also brought a couple of guys from B2 Gold. They've been seconded to work with us at B Metals, so it's really worked out. We've had these more experienced senior geologists coming over to the property and then we have some relatively new geologists that are doing a lot of teching and logging and stuff like that. So yeah, it's worked out really well so far. Great, thank you. Patrick Howard is asking, what is the next drill target? Yeah, good question. So, we've been focusing on 2 areas, Happy Valley, and we've now completed three-dimensional model. And The goal was to see where the mineralisation is going.

23:12 Happy Valley was where we had the original really good drilling results and Then we also drilled at Twist Creek and had a few good results. But one area that I'm really intrigued by and I went to visit when I was down in Australia is the Magpie Zone, which is also Myrtleford. Again, we walked the ground and there are numerous showings and workings and quite a bit of Gold extracted from it. That's an area right now where we're doing soil geochem, surface sampling and mapping. We're right now just flying a LIDAR survey over that as well. So that would probably be another area we're gonna target. But if you look at our presentation, there's no shortage of targets, but I think right now, I think the 2 areas we'll probably look at Happy Valley again, and also at Magpie, which is, like I said, a very compelling area.

24:09 All right, well, I want to thank you both so much for participating in this pitch battle. It's obviously way too close to call, so I'm gonna leave it up to the attendees to decide who won. But if either we know, contest, no contest, coming over there, Derek, I'm coming over there. Yeah, you can battle. I'm going to beat him at poker next just so you know. Perfect. Yeah, well, thank you all for joining. If you want to learn more about either of these 2 companies, you can do so on their website, bmetalscorp.com and e79resources.com. And if you miss any of the answers from today's battle, we will be publishing the recording of this later today. So you can rewatch it and send it to your friends. But with that, thank you both so much and have a great rest of your day. You.