A Value-Oriented, Contrarian Approach

Stijn Schmitz welcomes Quinton Hennigh to the show. Quinton Hennigh is an Internationally Renowned Economic Geologist who provides critical insights into the current state of mineral exploration and mining. Hennigh highlights a significant decline in metal discovery rates over the past decades, attributing this to major mining companies abandoning their internal exploration efforts and shifting responsibilities to junior exploration companies.

Hennigh’s current strategy focuses on acquiring assets with unrecognized exploration potential, particularly in underexplored regions like Bolivia, Argentina, and Japan. He emphasizes the importance of targeting large-scale deposits that would attract major mining companies’ interest, believing that it requires nearly the same effort to explore a small project as a potentially world-class one.

The discussion critically examines the current mining exploration landscape, with Hennigh expressing concern about the proliferation of junior mining companies. He argues that approximately 90% of these companies lack direction and technical capability, creating an inefficient market flooded with speculative ventures. This overcrowding has led to misallocation of capital and a diminishing pool of technical expertise in the mining sector.

Hennigh is particularly critical of current industry practices, including the royalty and streaming models, which he describes as “parasitic” to mining companies. He also highlights challenges in permitting processes and regulatory compliance, suggesting these bureaucratic hurdles significantly impede mining development. Looking forward, Hennigh advocates for more efficient capital deployment, reducing permitting complexities, and attracting younger talent to the mining industry.

He sees potential in unexplored regions and believes that with the right approach, significant mineral discoveries are still possible. His strategy involves identifying undervalued assets with substantial exploration potential, leveraging modern geological understanding to unlock value that previous explorers might have overlooked.

Timestamps:
00:00:00 – Introduction
00:00:43 – Under-exploration Crisis
00:01:07 – Dropping Discovery Rates
00:01:40 – Majors vs Juniors Exploration
00:02:21 – Value of Discoveries
00:03:40 – Investment Opportunities Spotlight
00:05:20 – Evaluating Project Upside
00:07:05 – Preferred Geology Types
00:09:45 – Brownfield vs Greenfield Approach
00:11:31 – Jurisdiction Preferences Discussed
00:18:23 – Too Many Juniors Critique
00:25:54 – Industry Talent Shortage
00:29:45 – Permitting and NI 43-101 Issues
00:34:17 – Royalties and Streams Critique
00:36:08 – Concluding Thoughts

Guest Links:
Website: https://www.crescat.net/

Quinton is an economic geologist with 40+ years of operating and investment experience in the precious metals mining industry. He earned a PhD in Geology and Geochemistry from the Colorado School of Mines. He worked as an exploration geologist for major global mining firms including Homestake Mining (now Barrick Gold), Newcrest Mining, and Newmont Mining.

He has made valuable contributions to other successful projects that include Kirkland Lake Gold’s acquisition of the Fosterville mine in Australia and the discovery and advancement of various tier-1 mineral assets worldwide, including New Found Gold’s Queensway discovery in Newfoundland, Eloro Resources’ Iska Iska silver/polymetallic deposit in Bolivia, Snowline Gold’s Valley deposit in the Yukon, and Goliath Resources’ Surebet gold discovery in British Columbia among others.