Heliostar Metals (HSTR) - New Focus on High Grade Underground Gold in Mexico

Heliostar Metals Ltd. is a Canadian exploration and development company with projects in both Mexico and Alaska. The company’s Flagship project, the Unga project in Alaska, is a high-grade gold project which covers both the Unga and Popof Islands along the Aleutian Island chain of Alaska. The project has a land position of approximately 240 km² with its mineralisation consisting of an intermediate sulfidation epithermal gold deposit.

Heliostar Metals’ CEO Charles Funk recently sat down for an interview to discuss the company's recent acquisition of Ana Paula from Argonaut Gold and their plans to rescope it as a high-grade underground. The interview also touched on the company's shareholder register and their cash position, as well as insights from the Denver Gold Forum in Zurich. Funk began by introducing himself and Heliostar Metals, stating that they had just closed a transformative acquisition of Ana Paula from Argonaut Gold. He explained that they were fully funded to rescope Ana Paula as a high-grade underground mine and had already begun the journey. Funk expressed confidence in their ability to rerate the company through this process. 

Mexico’s mining jurisdiction

Merlin Marr-Johnson, then asked Funk about the proposals for changes to the tax regime in Mexico. Funk noted that there were two big proposals that came out of it. The first was that new tenure and new applications in Mexico would now require a public consultation involving the government and community, taking away private competitive advantage. The second proposal was to limit tenure to 15 years plus a renewal, down from the previous 50 years. This would be quite punitive for big copper mines in particular. Marr-Johnson then asked Funk about Heliostar Metals' shareholder register and cash position. Funk explained that due to the transformative nature of the acquisition, they had brought in several new shareholders, including Franklin Templeton as their lead order, Adrian Day Asset Management, Eric Sprott, and Phoenix Gold Fund. He noted that they were well-funded with over $20 million in cash on hand. 

Marr-Johnson asked Funk about the challenges of operating in Mexico. Funk acknowledged that there were challenges, particularly around security and community relations. However, he noted that Heliostar Metals had a strong team on the ground in Mexico with deep experience in these areas and that Mexico was a rich mining jurisdiction with significant potential for growth.

ESG

Insights from the Denver Gold Forum in Zurich highlighted to Funk there was a lot of discussion around ESG (environmental, social, governance) issues and how mining companies can improve their practices in these areas. He mentioned discussions around decarbonization efforts and how mining can play a role in this. Funk also mentioned the importance of sustainability in mining and how Heliostar Metals was working to improve their practices in this area. He noted that they were focused on reducing their carbon footprint and improving their water management practices. 

Plans for the Ana Paula project

Funk went on to discuss Heliostar Metals' plans for Ana Paula. He explained that they were focused on rescaling the project as a high-grade underground mine, which would require significant drilling and exploration work to better understand the deposit and identify high-grade areas for underground mining. Funk noted that they had already begun this process and were seeing positive results, including high-grade intercepts.

The mining industry and COVID-19

The conversation then turned to the broader mining industry and the impact of COVID-19. Funk noted that the pandemic had certainly created challenges for the industry, particularly around supply chain disruptions and travel restrictions. However, he also noted that mining had been deemed an essential service in many countries and had been able to continue operating throughout the pandemic.   

Background and expertise

Marr-Johnson then asked Funk about his background and how he came to be CEO of Heliostar Metals. Funk explained that he had a background in finance and had previously worked at Goldman Sachs before transitioning to mining. He noted that he was drawn to mining because of its potential for impact, both in terms of economic development and environmental stewardship.

Charles Funk's interview provided valuable insights into Heliostar Metals' recent acquisition of Ana Paula from Argonaut Gold and their plans to rescope it as a high-grade underground mine. It is clear that Heliostar Metals is well-positioned for success with a strong team on the ground in Mexico and significant cash reserves to fund their exploration and drilling efforts.

To find out more, go to the West Vault Mining website