Mike Niehuser Founder, Beacon Rock Research

Mike Niehuser: This is Mike Niehuser, founder of Beacon Rock Research and with me today is Jason Weber, President and CEO of Kiska Metals Corporation, that’s ticker symbol KSK on the Toronto Venture Exchange.  Hello, Jason.

Jason Weber: Hello.

Jason Weber CEO, Kiska Metals

Mike Niehuser: Jason, we’re here to talk about Kiska.   And I am a shareholder and I am excited to hear you tell me about it.  Tell me, what, what is the big deal about Kiska Metals?

Jason Weber: Well I think the… probably the, the biggest factor that works for, for Kiska and I think what’s gonna be beneficial for our shareholders going for here is the, the fact that we’re exploring a brand new gold-copper district in Alaska.  And this is an area where we’ve got one deposit that has a 43-101 resource of about 5.6 million ounces gold equivalent.  We’ve got 4 discoveries in the vicinity of that deposit.  These are new porphyries where we can add ounces through further drilling; and we have numerous targets where we can make new discoveries.  So, the idea here is that we’re building a new camp with multiple gold-copper deposits in a, in a very well-located, very good spot in Alaska.  So, I think the upside here is tremendous.

Mike Niehuser: Well, correct me, what… it seems that sets Kiska apart is it’s still a very early story as you’ve, as you’ve mentioned; but, it has some very big, almost elephant-type projects in the vicinity between Alaska and British Columbia. To name a few: Donlin Creek and the Pebble Deposit in Alaska as well as KSM and Galore Creek in Canada.  Why don’t you tell me a little bit a… are these sort of what you would envision the direction for Kiska?  Am I overstating the case?  Please help me out here.

Jason Weber: No, I think it’s important to… as geologists, when we go exploring for large deposits, I mean, we, we really wanna look for deposits that a major gold producer is going to want to, to acquire and try to develop.  So for us, another big deposit in that same Delta Rocks that we’re in is, is very encouraging.  In our case, we’ve got the Pebble Deposit to the south of us, about two hundred and eighty kilometers or so to the south and, you know, Pebble’s a huge deposit, it really is… when you look at porphyries around the world, it would rank right up there with the biggest one.  So for us, having Pebble in the same group or Delta Rocks: very, very important and very encouraging.  We know that the environment that created the geology that we’re exploring within was favorable to big deposits.  But, probably the analogy that we, we like to draw upon is the Maricunga Gold Belt in Chile, they’re… in this area, you’ve got a series of gold-rich porphyries that, over the same geographic spread that we’re dealing with at the Whistler Project, you’ve got over 50 million ounces of gold that’s been defined there over the last, oh 20, 25 years.  So, that’s more the scenario we look at rather one huge deposit like Pebble, we’re looking in a district that’s gonna have multiple gold-copper deposits.

Mike Niehuser: Well, that’s interesting because you’re talking about the Maricunga Belt, I think, and that’s… to go to your website, if investors are interested and look at the PowerPoint Presentation there, it spells this out nicely.  You’ve got, you know, Cerro Casale, Caspiche, and Refugio:  each one of those deposits or mines-to-be could be a company-maker in their own right and you seem to… these porphyries seem to come up in, in pods, like elephants in a herd, so to speak.  And that, that kind of looks like what you have starting to form there at Kiska.

Jason Weber: Absolutely.  The right within, oh say, 3 to 5 kilometers of the, the Whistler deposit where our 5.6 million ounce resource is, we’ve got 3 discoveries.  These are 3 separate porphyry systems.  They’re very early-stage.  We’ve got… one has one hole and the most advanced has five holes into it.  And then, we have another, 23 kilometers south called Island Mountain.  We got targets further north.  Our, our land package extends for almost 40 kilometers in a North-South direction.  So… yeah, we do… we, we control a big district.  It’s favorably located.  It’s got lots of targets on it.

Mike Niehuser: So, you do have an established resource, which I should mention, is a, is a gold equivalent 5 million ounces.  But the, the discovery of the hole that you have on the Island Mountain is even… seems to be at higher grade even than Whistler.  So right now, it’s still open, I would imagine and could be similar to Whistler or possibly even larger, I wouldn’t want to say.  But, is that correct?

Jason Weber: Yeah, absolutely.  Again, you know, it’s very early days in the exploration of Island Mountain.  We made the discovery in 2009, our very first drill hole.  We’re up to hole 15 in the area.  So, not all the holes have been on the, the Breccia Zone where this, where this new discovery was.  But certainly, we are getting some very encouraging grades there.  In fact, we have a… last year we released… one of our last holes in the season was 115 meters.  It averaged a gram and a quarter gold (1.25 g/t gold) and 0.23% copper.  So, that is higher than the average grade at Whistler.  But, that’s not to say that there aren’t some nice high grade pods within the Whistler Deposit itself that would have grades as good as this or, or better as well. So it’s, you know, it’s really gonna be looking at the big picture at Island Mountain like any other of the prospects in the district.

Mike Niehuser: We have… we have the resource at Whistler, we have the discovery hole that’s gonna be followed up in Island Mountain and then we have other targets… Jason, can you tell me what your… what you hope to achieve this year in 2011, with exploration that investors should keep an eye out for?

Jason Weber: Absolutely.  I think for us, it’s… really, it’s a three-prong approach to exploration in the Whistler area.  There’s… really, there’s three things we wanna accomplish.  One, is to add ounces to the story; add ounces to the, to the Whistler District resource base.  And the fastest way to do that is to, to expand on some of these new discoveries we’ve made: the three right in the vicinity of the Whistler resource and then, Island Mountain to the south.  The second focus is to make new discoveries in the area.  There are numerous geophysical targets.  One of the challenges we have is, there’s a fair amount of glacial till that blankets portions of the property.  It’s, it’s only 10 to 15 meters thick, but it… what it does is it, it limits the number of techniques you can use to define your, your drill target.  So, geophysics has been very important for us, especially in the north part of the property.  And we’ve identified in excess of 20 targets by geophysics that we need to follow up with, with drillholes.  So, that will be a part of the program in, in 2011.  And then the third aspect, we, we call “understanding our asset.”  And, that is going back into the Whistler Deposit itself and essentially, pulling apart the geology, drillhole by drillhole, reselling it in terms of the grades and drillhole intersections that we’ve made so far, and then building a geological model that’s gonna help us to refine – especially some of the higher grade zones within Whistler – get better definition on those and an idea of how big they are.  But, this is really valuable information as well, to take to these other discoveries right in the vicinity.  And what we’ve learned from the geology at Whistler, we’re gonna be able to apply to the exploration of these other targets as well.  So, that will make us more efficient explorers in those, those areas as well.  So it’s, it’s really those three aspects that will drive the 2011 program.

Mike Niehuser: So, it sounds like the understanding of the geology is important; to put meat on the bones of the district, but when investors this year should be treated to a large amount of drill results coming out and it seems like the market, really… at this stage of early development, the market really likes to see drill results.  And it seems like that’s what happened with the stock price’s good move after you reported Island Mountain.  And you know, maybe there’s good possibility of that happening again in 2011.

Jason Weber: Well, absolutely.  The, I think it’s… for us, it’s really exciting that you’re gonna have this resource at your base that, you know, your anchor and then, all these other targets outside of it… you know, for the investor, we’ll be starting the, the 2011 Program in early March, drilling at Raintree West discovery.  There’s 5 holes that have been drilled there, to date.  If we started expanding on those 5 holes with, with new intersections in the drilling this year, that’s definitely gonna have a positive impact on, on the share price.  And then, with some of the… there’s more exploratory drilling where we’re drilling for new discoveries; those obviously have a big impact on, on the share price as well, when those are made and announced.

Mike Niehuser: One of the things we haven’t discussed is… and also, a support of value or taking risk out of it, it seems like these deposits that I’ve mentioned earlier, you know, it seems that your projects there don’t suffer from some of the issues that, that they do.  For example, you don’t seem to have the environmental concerns that you might have with the Donlin or the refractory ore at the Donlin Creek.  And as well, you’re seem to be closer to Anchorage and also, potentially, on the course of the natural gas line to Donlin as well. You have potential for hydro and geothermal power and labor.  And it just seems like you’re very blessed, you know, with Alaska being a politically-safe jurisdiction to do business in, it seems like this is a place where you’re gonna have several years of unimpeded opportunity to explore and develop and understand and create value.

Jason Weber: Yeah, I couldn’t agree more.  The… with the usual caveat that anytime you’re working in a first-world jurisdiction, you’re gonna have, you know, issues to, to work through.  But Alaska is a… it is a resource-friendly jurisdiction.  Our proximity to Anchorage is… really provides us with some excellent examples that you’ve mentioned.  Probably the big one for us right now is just watching the, the progress NovaGold and their partner make at Donlin Creek with regards to the feasibility of a natural gas pipeline up to their project – that would go right through Whistler – so, that would be of great benefit to us.  Yeah, we’ve done metallurgy on, on Island Mountain and the Whistler targets.  The metallurgy comes back very favorable.  So, we don’t anticipate any issues there.  And I, I think one of the, sort of the neat things for us, too is when you have good recoveries or expected good recoveries that, that amount of metal that makes it into your concentrate really has the effect of upping your grade.  You can see that if you have a, of an average grade of one gram per tonne gold but you’re only recovering 60% of it, that’s… effectively, your grade’s only 0.6 grams per tonne.  So, if you have a, of little ore grades but your recoveries are much stronger, that can actually work out to be very favorable for you.  So, all those factors seem to be working in our favor right now.  In fact, you know, you mentioned infrastructure; we’re currently building an ice road to transport gear and equipment and fuel into site and not… you know, essentially, we’re mobilizing out of Anchorage, build a 110-mile ice road that will allow us to bring a lot of gear into site, for favorably the cost-effective means.  So… yeah, that proximity to Anchorage is important to us.

Mike Niehuser: Well, as I recall, you have a pretty substantial camp built there already, is that right?

Jason Weber: Yeah, we have a 50-person camp, 3,000 foot long airstrip that’s adjacent to our camp; it is a brand-new spot, where our camp’s located right now, our new airstrip located in close proximity to where the bulk of our drilling will be for 2011.  And again, that allows us to, to save, you know, obviously, the closer to where you’re working, you know, the less your costs are as far as just travelling back and forth from your base to where your, your operations are.

Mike Niehuser: Well, it’s interesting looking at the charts here.  Clearly, your below the 52-week high but not by much; but if you compare the, you know, the value of the company on a “per ounce” basis, it’s very comparable with some of your, again, some of these larger deposits around.  But, it seems that once you get to be a big deposit, more ounces sometimes doesn’t matter all that much. But, you’re at a stage where if you can increase ounces – and of course, you only add the ounces now in the resource at the Whistler deposit – if you’re able to repeat that performance at Island Mountain, maybe elsewhere in your, you know, your property, that should, that should materialize, one would think in a higher share price.

Jason Weber: Yeah, absolutely.  I think that, you know, there’s… when you look at a company like ours and we’re trading somewhere in the neighborhood of, you know, US$15 to US$16 per ounce gold equivalent, you know, a lot of our peers can be trading in sort of a US$30 to US$40 range and even higher.  If you look at that, every ounce that you add to that is adding another US$15 in value.  So for us, really, the goal is to add a framework of, of ounces to the story, that’s the, probably, the fastest way we can, we can add value to the project.  The other way we can add value is, is the improving the confidence in those ounces.  So that means taking it from, you know, the Resource, Inferred Resource category moving it up into, say, Indicated or Measured.  That is more, that’s a more costly process.  And, we’re not convinced that we found the best target on the project yet.  So, when we take that step of adding confidence to ounces, we wanna make sure we’re on the best target.  So that… this next phase of work really, it’s gonna be about identifying those new, new target areas and letting us assess which area we wanna, we wanna move forward, which target’s the one we’re gonna try to start to build the project around.

Mike Niehuser: Well, I think that was one of the exciting things about that island Mountain hole that it was a very good grade over a very long length that, it really sparked the imagination that it could possibly outdo Whistler, and of course, there’s a number of other targets that you have there.  Some that are hidden that slowly are starting to come to the surface.  So… well, I’m excited to talk to you, Jason.  I appreciate your time.  For those that wanna more about Kiska can certainly visit your website and look at a very nice corporate presentation.  Again, this is Mike Niehuser with Jason Weber, President and CEO of Kiska Metals Corporation, that’s KSK on the Toronto Venture Exchange.  Jason, thank you very much for your time.

Jason Weber: Thank you, Mike.

Radio CIC Disclaimer:

Radio CIC is a production of Contrary Investors Café and is produced for educational purposes only.  Opinions of guests do not necessarily reflect those of Radio CIC, Contrary Investors Café, its’ staff, affiliates or advertisers.  Radio CIC does not specifically recommend any investments nor does it intend for information imparted by guests to be investment recommendations.  As always, consult a qualified financial adviser before making any financial decisions.