In this week’s Interview of the Week, Mexico Mining Review, Gregory Beischer, CEO of Millrock Resources spoke about exploration projects and mineral concessions in Mexico. With investors still hesitant to invest in risky projects including exploration, how is Millrock funding its activities? Find out here!


Gregory Beischer, Millrock Resources


There is no doubt that mineral exploration is a risky business. The odds of finding a valuable discovery that has the potential to be turned into a mine are somewhere between one in 1,000 and one in 5,000, according to Gregory Beischer, CEO of Millrock Resources. “To make exploration financially sustainable and profitable for shareholders, Millrock partners with mine operators to fund it and share its risks,” he says.

While share-selling is usually how exploration companies raise money for their projects, Beischer believes that this is not truly sustainable. “Mining companies raise money by operating mines and reinvesting some of their profits, but exploration companies usually have no income except sales of shares,” he says. As investors can only buy a certain number of shares, exploration companies can often come up short when collecting the kind of money needed to fund their discoveries.

Millrock Resources addresses this dilemma by seeking a funding partner, so most of the money for exploration comes from profitable mining companies rather than from investors buying equity. The deal is simple: the operator acquires 50-80 percent of the interest of the project, depending on each agreement, while Millrock retains 20-50 percent.

To enhance the chances of succeeding in finding a high-value mineral deposit, the company’s model involves operating several simultaneous exploration programs on multiple projects. “By doing so, we increase our chances of success this, but we give up a portion of the project. Having said that, the portion we retain can still be highly valuable.” Beischer says, giving the example of the high-grade San Francisco mine in Sonora, operated by Alio Gold. “Even if we owned 20-50 percent of a project like San Francisco, we would still make a lot of money for our shareholders,” he says. “Since big companies are looking for big deposits, our approach is to identify geologic targets that would make a difference to the bottom line of a company in case of a discovery.”

Beischer explains that to make an exploration project attractive, exploration companies must begin by gathering all the previously available information and collect it in a database. “We produce good maps that can clearly explain why a company should invest several million dollars in a certain project,” he says, adding that this eases the process of finding a funding partner. For example, Millrock Resources has an agreement with Centerra Gold in which the latter can earn 80 percent interest by funding the exploration work. “This way we do not risk too much of our shareholders’ money and still end up earning 20 percent on the project’s profits,” he says.

Centerra Gold decided to participate with Millrock on two exploration projects, La Navidad and El Picacho. The projects target an orogenic gold deposit located in the state of Sonora, similar to La Herradura, Nochebuena and other comparable mines operating in the region. “We completed the first drilling program in late December 2017. The results were good and reconfirmed what we knew from historic drilling,” says Beischer.


Millrock Resources is a project-generator company focused on discovery and development of high value metallic mineral deposits in four jurisdictions with outstanding potential: the State of Alaska, British Columbia, the Southwest USA, and Mexico – primarily the state of Sonora. The company’s main emphasis has been on gold and copper, focusing on porphyry and high grade vein style deposits. Its objective is to discovery a world class ore body, building further shareholder value through the exploration and development of existing projects and exploration joint ventures.


This is an exclusive preview of the 2019 edition of Mexico Mining Review. If you want to get all the information, plus other relevant insights regarding this industry, pre-order your copy Mexico Mining Review or access our digital copy of the 2018 edition.


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