Fireweed Zinc Corporate Update: New Road Improvements for Macmillan Pass and Surrounding Communities
Trevor Hall [00:00:07] Welcome back to Mining Stock Daily, everybody. I'm on the floor of PDAC, and sitting next to me is a friend, Brandon Macdonald, of Fireweed Zinc. You know this is a really interesting conversation because we're not actually talking about drill results or exploration or stuff like that. You had really great news yesterday about the road that's coming into McMillon Pass through the Yukon. It's obviously beneficial to you as the CEO of Fireweed Zinc and the project, but it also has, it's also really important for the people in the area as well. So give us kind of a breakdown of what the government in the Yukon accepted, the seventy-one million dollars to get this road going. But why is it so significant for you, Brandon?
Brandon Macdonald [00:00:47] Yeah. So there's, like you said, the headline is that they committed seventy-one million to the improvement of two roads. This is the Robert Campbell Highway and the Canal Road. Fireweed Zinc has envisioned a potential mine plan [that] would use both those roads during our con out. The real problem spot for us was the Canal, which simply was not in a condition to haul significant amounts of concentrate. So there's money coming in now there's going to be bridges replaced this summer. There's going to be some preliminary engineering on it, they're going to do a bunch of clearing out to improve sightlines and make it safer, and then begin the repair work in the longer term. And then on the Robert Campbell, now the Robert Campbell is interesting in that it's paved. I mean, like chip and seal as far as the community of Farrow, and then you get another about 70 kilometers to the community of Ross River, which is an indigenous community. And it's a gravel highway from there. Right? So there's a certain unfortunate symbolism of the paved road going to the community full of white people and then being a dirt road to the indigenous community. So part of what this infrastructure fund is doing or this money is doing is, you know, fixing that road and servicing it properly all the way out to Ross River. And that is the last community in Yukon that does not have a properly surfaced road in the entire territory. Right? So, you know, this is not just about, although it's about mining and that's the mechanism through which this funding was secured, et cetera. This is also about reconciliation with an impoverished indigenous community. Right? And as strange as it sounds, they have a fuel services company that's actually been doing really well. They've got the contract for the Ferrall Miner mediation. But, you know, it's tough to run a business when all your stock is getting beaten up on a crappy road when you're doing all your fuel deliveries. Right? So it's about economic opportunities there as well. And not to mention over the years, actually, that that stretch of road has claimed quite a few lives. Right? Cause it's just not, in winter, a rough road like that can be treacherous. So that community is near and dear to my heart.
Trevor Hall [00:03:13] You grew up there. Right?
Brandon Macdonald [00:03:15] Yeah, we lived there until I was five years old. And so we have roots there. I have friends there. And I'm happy that they're getting this. This is good for them economically, safety, you know, dignity. Right? So I think that's fantastic. And then the covers the immediate impact for us is a reduction in our CapEx. And we're hoping that there's more of this to come. And this will be the first tranche of it. And it's a symbolism of an explicit endorsement from the community for the project. Right? Like it's not a rubber stamp, go build it. But it's like you know what? We want to see this road down and want to see it succeed. And we want that to do to simplify your path to get there.
Trevor Hall [00:04:03] Well, I think there's so much symbolism behind what was announced yesterday, not only for Fireweed as a project because obviously the share price jumped up 30 percent today as we're recording this. A nice, healthy bounce off of economic policies that were announced. But it also I think is a symbolism not only for you personally because of your roots there, but also it just shows what mining really can do outside of its own project, working with community members. And when we get criticized for not doing enough of that, everybody should be listening to this podcast about why it's important.
Brandon Macdonald [00:04:36] Yeah. And I think that's critical because, you know, our project would be as envisioned 300 jobs effectively for 20 years. It's very significant. I mean, to a community of 300 people, that basically means everyone who wants to work at the project can. Right? But it's also about what are the ancillary benefits, what are the other industry that crops up? What is the infrastructure that's built for this that then has value, you know, in perpetuity? Right? And that's you know, the community seeing that they're going to see the benefit of it.
Trevor Hall [00:05:10] Oh, so as its infrastructure continues to improve this summer and, you know, how is this going to have a direct effect on the project? Is it going to speed some, you know, your 2020 strategy is up a little bit, or are you looking more at 2021 when the roads are actually somewhat finished? How does it immediately benefit McMillan Pass?
Brandon Macdonald [00:05:30] So as I understand it, now I don't think plans are 100 percent in stone yet, but my discussion with the Yukon's Highways Department is one of the bridges they're looking to replace possibly first is actually the bridge which is the bottleneck for weight restriction on the road. So getting that lifted means heavier loads, it might mean bigger trucks and fewer deliveries. Right? So that's critical.
Trevor Hall [00:05:58] Your cost might come down a little bit.
Brandon Macdonald [00:06:00] Yeah. And I don't know if it's a law, but it's something. Right? And you know, for us right now, the challenges that the base metal sector is beat up. And, you know, as the old expression goes, the market tells you how fast to go. And so for us, the market's not telling me to go particularly fast right now. So what is the capital available to us, and what are the terms that I have to accept for that capital? Right? So this is, we're lucky that because we have a really fantastic project and we've just got this major wind behind us, we do have a lot of tools available to us, but it's all suboptimal. Right? Like you're going to have to accept pain in some way. So that's, you know, so we'll look at all these tools and evaluate what the right move is.
Trevor Hall [00:06:47] Well, the timing of this whole thing is quite interesting because I think the one thing I respect about you the most is like you're really honest. We're like, "Zinc is not a play until like 2022." You know, you're just out there and like, nobody cares about zinc, you need another two years. But what the timing of this road, I mean, there's a good chance everything could be finished by the time of zinc could really start to pop in your head.
Brandon Macdonald [00:07:11] Well, the analogy I've used to people is that you can, your boats on the beach and you can wait for the rising tide or you can drag that damn boat out to the ocean. Right? It's like, you know, that's what we're trying to do. You know, we're going to bring the boat to the ocean rather than wait for the ocean to come to us. But it's tough. Right? It's not an easy market to be marketing a zinc up. And you pour your point, I've been telling people like, "Look, we're not a three to six-month trade where you got to have an 18 plus month horizon." And like many other base metal plays, we have huge value there. Right? The world needs our projects, but it's just, don't anticipate like an immediate recovery. Probably precious metals first and then base metals. Which is to say also, "Who knows?" We could be doubled in four months because I don't know, things can happen. Like ISIS is back, you know, for example, there's all sorts of wildcards, like does China announce a massive stimulus on the back of the issues with Coronavirus? Like, do they try to prop up the economy? And stimulus means infrastructure, infrastructure means zinc. Suddenly, we could be right back at it. So I don't know. But for now, we're trying to curate a shareholder base of patient people. Because what I find is when you pander to the day traders, you're hamstringing your own long term success to the benefit of someone who's going to be trading under their position in one month. And that's such a small percentage of your shareholder base. You've got to think about the people who are holding, who are actually owning this and what's best for them. And so trying to chase that hot money is not always a great move.
Trevor Hall [00:09:06] Well, Jeff Pontious of Corvus Gold said some really interesting to me yesterday. He said, "We want to build a project people can rely on and that means you do it the right way, even if it takes a little bit longer." Right?
Brandon Macdonald [00:09:19] Yeah. And as they say, better the right project later than the wrong project now. And per ours, you know, like what are the wins we can get that don't cost a lot of money? It's something like this? Right? I've been advocating for this within the community and the government for a while, and I'm really happy to see this happen. And there are other wins we can get that don't require a massive draw budget. So this is you know, this is the task before me. And I was saying to someone else this morning, as the markets like these are kind of where you separate the wheat from the chaff and the management teams. Because when things are really challenging, do you trust your management team to be good stewards of the company? This is when you run the risk of blowing up share structures to try to keep meet payroll. So that's why I like to think we're good stewards, and I hope people agree.
Trevor Hall [00:10:16] I think they do agree. I look forward to covering you over the next few months and we'll be sharing all the news out of fireweed and doing some more corporate updates with you and the team and everybody under your umbrella. So I look forward to that. It's gonna be great a last couple days of PEDAC and then we're gonna go rest.
Brandon Macdonald [00:10:35] Yeah. Yeah. Yeah. It's I'm getting a little tired, but that's the nature of the business.
Trevor Hall [00:10:41] Well, you and I are going to go home and our wives are literally just going to hand us the children be like, take care of them. Welcome home.
Brandon Macdonald [00:10:46] Yeah, exactly. A new kind of exhaustion.
Trevor Hall [00:10:49] That's Brandon Macdonald. He's with Fireweed Zinc. You are listening to Mining Stock Daily.