MiningFeeds recently had the opportunity to sit down with George Bee, the CEO of U.S. Gold Corp. (NASDAQ:USAU), for an in-depth discussion about his career, the strategic direction of U.S. Gold Corp., and the exciting prospects of the CK Gold Project in Wyoming. George Bee, with his extensive background in the mining industry, offers a wealth of knowledge and experience that has helped guide U.S. Gold Corp. through critical stages of development. The following is an unfiltered view of our conversation, capturing George’s insights as he delves into the past, present, and future of U.S. Gold Corp. and the mining industry.

From Retirement to U.S. Gold Corp: A New Chapter

After a long and successful career with Barrick, where he played an important role in the development of the Goldstrike mine in Nevada, and contributing to some of the most prolific gold trends in mining history, George Bee decided to come out of retirement. When asked what compelled him to take on a new challenge with U.S. Gold Corp., he replied:

“There’s only so much skiing and outdoor activities you can do before thinking, ‘I should use my accumulated experience!’ I sat on a number of boards and was involved in some consulting when I met Luke Norman, our Executive Chairman and co-founder of the company. We were looking at something totally unrelated to US Gold and he then asked me to look at what was then called Copper King. The project looked dead simple, in a great jurisdiction and had good economic potential. I said, ‘that’s easy to develop and can be done on a fast-track basis.’ So, the moral of the story is to be careful what you say, you might get handed the keys, which is what happened.”

The CK Gold Project’s Economic Viability and Resource Expansion 

The CK Gold Project has drawn considerable interest for its gold and copper production profile in a mining friendly state.  However, beyond that is the potential for resource expansion and how by-product waste rock might factor into the project’s economics. In putting it all together, Bee emphasized the practical methodology U.S. Gold Corp. has taken in demonstrating the project’s viability:

“There was some skepticism about the project since it has a modest grade and sits alongside the Curt Gowdy State Park in southeast Wyoming. Before expanding the potential of the deposit, we had to first show that there was a compelling economic incentive to develop the project, and secondly demonstrate that we could get the project permitted. In December 2021 we published our prefeasibility study which showed, on the basis of the copper and gold in the deposit, robust economics evaluated at $1,625/oz gold and $3.25/lb copper. By September 2022 we had completed 2-years of environmental baseline studies and prepared a Mine Operating Permit (MOP) application and submitted it to the Wyoming Department of Environmental Quality – Land Quality Division (DEQ-LQD). In May 2024 we received conditional approval to proceed with the project, having already received another key permit approval, the Industrial Siting Permit, in June of 2023.”

Bee further elaborated on the future potential of the project, hinting at additional resources yet to be explored:

“We know that we have additional resources at depth and the orebody bottoms out in mineralization. There is also a trend to the southeast of the project that warrants additional exploration. The strategy has been to conserve treasury at a time when funds have been difficult to come by without excessive dilution and focus on what we have already defined. There is upside in the resource and we will pursue that in due course.”

“Not All Ounces Are Created Equal”: Insights from the SME Conference

During the recent SME (Society for Mining, Metallurgy & Exploration) conference in New York, George Bee delivered a keynote speech on the notion that “not all ounces are created equal.” He used his extensive experience in various mining projects worldwide to illustrate this point:

“Having worked on remote projects high up in the Andes in South America, the point I was making is that if a project is not close to infrastructure, has no power supply nearby, needs to transport, house and feed personnel, hold large inventories of critical spares to maintain the operation, then there better be higher grade reserves with higher economic margin to support the development. I was able to show the juxtaposition between some of the projects that I have been involved with and the CK Gold Project to demonstrate that the location is vastly superior to other similar projects. We are in a stable jurisdiction with no political risk, we know the rules of the game through established statutes governing the activity, the infrastructure is second to none, people can work and go home after their shift, and we are well supported locally by contractors who are well equipped to serve our needs. The point is that an ounce of gold on top of a mountain in the Andes is not the same as an ounce 20-miles outside of Cheyenne, Wyoming in terms of its economic potential. There are also the technical factors associated with the metallurgical recovery of that ounce but I believe you see my point.”

The Strategic Importance of Rail Proximity

The CK Gold Project stands out for its gold and copper potential and for the strategic opportunities presented by its waste rock. The proximity to rail infrastructure could play a crucial role in maximizing the economic benefits of this by-product, as Bee explains:

“Our current plan and permit are centered around the recovery of gold and copper into a copper gold concentrate, producing around 160 tons per day. This can be trucked away without much impact to the local road infrastructure. In looking at on-site material to support the construction of the project, we found that the ‘waste’ rock that we will have to move and set aside to get at the copper and gold ore is a superior aggregate resource. Our current plans show that we set the waste aside and reclaim and revegetate that waste in piles created adjacent to the open pit. Once we have accounted for the rock that we need to build roads, stabilize tailings and other on-site needs, it’s estimated there will be more than 35 million tons in the piles to be reclaimed. Our neighbors, in a quarry 3-miles to our south, mine rock with no gold or copper in it and sell it at the gate for around $20/ton. What we want to explore is putting the rock we have set aside to beneficial use. It would be a win-win scenario since the State will receive a royalty payment, the mine can sell the rock which we have already paid to mine, we reduce our reclamation footprint and area of impact, and the fuel and energy expended to remove the rock would offset the energy needed to produce the rock someplace else if we put the rock to good use.”

Bee continued to highlight the significance of rail proximity for the project’s long-term success:

“The issue is that it is a bulk commodity. While we could move a fair amount by road with the necessary impacts mitigated, it would be much better to move the rock to market by rail. This lowers impacts, extends the commercial area that could be served, and increases the amount that could be sold. Our focus is getting the copper and gold mine up and running. Commercializing the waste rock is an opportunity and the proximity of rail to the site provides a great deal of potential. This is a matter for further planning, discussion with the locals and a permitting exercise.”

Wyoming’s Resource Tradition

Wyoming’s longstanding tradition as a resource state has also influenced the CK Gold Project’s development. Bee compared Wyoming to other jurisdictions he has worked in, highlighting the unique advantages the state offers:

“Wyoming has a population of almost 600,000 people and relies in large part on the revenues generated from the resource sector. Coal, oil, gas, trona, uranium resources are all recovered to help the economy and keep taxes low in the State. Coal mining has been a stalwart activity, but it is coming under pressure as coal-fired power generating stations age and are not replaced as society contends with concerns over emissions. Being well versed in regulating and managing the resource sector, Wyoming is an excellent jurisdiction with regulators, politicians, and people who realize the need for and benefits of the resource sector. The laws and statutes are well understood so an investor knows the ‘rules of the game’ and the regulators are knowledgeable, experienced, and motivated to support the resource sector. The CK Gold Project will be the first ‘hard rock’ mine permitted and brought into production in many years and offers a diversification in the resource sector in Wyoming at a time when coal production is diminishing. This allows US Gold Corp. to benefit from an established support sector for the mining with contractors, labor, and services looking for new opportunities.”

Reflecting on his experience in different parts of the world, Bee noted:

“I have worked in many different jurisdictions with differing levels of political stability, regulatory framework, and experience with the resource sector. I can attest to the fact that Wyoming is ready, willing, and able to support environmentally sound, responsible mining. This is not the case elsewhere and it’s quite frustrating especially in North America with its large land mass, well endowed with mineral wealth. The federal government, provinces and states tout their resource opportunities but often make it so difficult to actually bring those resources into production.”

Local Economic Benefits and Unique Project Attributes

The CK Gold Project is not just another mining operation; it will provide substantial benefits to the local economy and resource profile, receiving strong support from the community. Bee highlighted several factors that make this project unique and advantageous for the region:

“Again, Wyoming is a resource state, and the areas in which we are located are familiar with mining activity. There is a large active quarry (Granite Canyon Quarry) some 3-miles to our south, so people are aware of the activity. Located in southeast Wyoming, there is a greater tolerance of the resource sector. This would be totally different if the project was close to Yellowstone National Park or Jackson Hole. Being situated close to both the Interstate I-25 and I-80 means that the project is well served and an easy drive from Gillette, WY, Denver CO, and Salt Lake City UT, all centers where contractor and equipment support for the mining sector can be readily found. Not having to build a man-camp and long-distance transport, with a locally well-trained workforce that can live in the area around Cheyenne, are all huge factors in our favor as we compete for labor and talent.”

Bee also discussed the significant financial contributions the project is expected to make to the state, further solidifying its local support:

“Additionally, being on State land and operating under a lease with the State, several tens of millions of dollars will be paid in royalties, earmarked for K through Grade12 education, in addition to more than $88 million in taxes. We truly believe that the project will be a huge win for the local area providing good jobs and significant revenues.”

Looking to the future, Bee emphasized the positive legacy that the CK Gold Project could leave for the community:

“Furthermore, with an eye to the future and the positive legacy that we hope to leave when the mining is concluded, we believe that we can provide additional water storage for the city of Cheyenne obviating the need to increase the existing reservoir capacity in the Granite and Crystal Lakes in Curt Gowdy State Park. Eventually, Cheyenne needs more water storage to meet the growing needs of the city as it thrives. Water brought over from the Snowy Range west of Laramie is stored in the reservoirs in Curt Gowdy Park. Using the exhausted pit would avoid the need for a huge civil project to increase the reservoir capacity and the disruptions to the recreation facilities around the park. The reclaimed mine site could even be an extension to the park.”

Looking Ahead, Near Term Catalysts

As U.S. Gold Corp. continues to advance the CK Gold Project, updates to the prefeasibility study (PFS) have become a critical focus, especially in light of recent market changes. George Bee shared his expectations for where the updated PFS will reveal improvements:

“We obviously see that the initial gold and copper prices used at $1,625/oz and $3.25/lb, respectively, will be far outstripped by current prices. Conservatively, our evaluations at $2,000/oz gold and $4.00/lb copper, when the current prices are well in excess of those numbers, suggest significantly more revenue from production. This will be offset to some extent by increased costs due to inflation and higher capital costs since 2021. We believe that the margin will be preserved if not improved. Additionally, we continue to work on improvements and enhancements to the plan, and this is besides the aggregate opportunity.”

Looking forward to 2024, Bee identified several near-term catalysts that will drive the CK Gold Project closer to development:

“Now that we have established the criteria and commitments associated with our permit approval, we can finalize the facility designs and incorporate those into our PFS. We are also looking at a trade-off on some alternative flotation technology which purports better recovery from less equipment than our conventional flot cells in our current estimate. An updated PFS will show the direction we are taking and identify the opportunities that we hope to capitalize on for our feasibility study. Additionally, we hope to reveal partnership and/or financing avenues which demonstrate a pathway to completing development without excessive dilution to our shareholders.”

The Keystone Gold Project – Nevada

While the CK Gold Project remains the primary focus, U.S. Gold Corp. has not forgotten about the Keystone gold project, located just 11 miles south of Barrick-Newmont’s second largest gold operation in Cortez Hills. George Bee discussed the potential of Keystone and how the company plans to tap into it:

“The CK Gold Project has been our intense focus for the last few years, consuming our attention and treasury. We have done some low-cost remote work covering our 20-sq. mile Keystone property. The satellite imagery showed some anomalies in areas beyond our current primary targets. A field inspection and some grab samples revealed additional areas of mineralization and, as yet, additional exploration opportunities. We are very excited about the prospects for Keystone which we believe to have similarities and analogies to the multi-million-ounce Nevada Gold Cortex Complex. The reality though is that the appetite for exploration funding simply has not been there until recently, hence our pivot to the CK Gold Project. Keystone’s time will come and it is potentially a ‘game changer’ but needs several tens of millions of exploration dollars to do it justice. We will be pursuing Keystone in due course.”

In a candid assessment of U.S. Gold Corp’s current market valuation, Bee expressed his belief that the company is significantly undervalued given its assets and progress:

“Well you may have heard this from a number of entities but we truly believe, ‘we are significantly undervalued’ in the market. The current market does not seem to be a ‘normal’ market and the whole sector, not just US Gold Corp. is suffering. Typically proven and probable ounces in the ground should trade around $250 per ounce, implying a value of $360 million, just for the CK Project. The fact that we have a permit to develop the project and have essentially taken away that huge element of risk, should have us trading at around 50% of our NPV. At $325 million identified in our 2021 PFS, that should put USAU north of $150 million market capitalization on CK alone.”

Despite the current market challenges, Bee remains optimistic about the company’s future:

“And yet we are sitting around the $60 million mark, which speaks to a strange dynamic in the market. This being the case, we continue to ‘move the ball down the field’ towards development and the generation of free cash flow to form a stable, low risk project in a great jurisdiction. ‘Build it and they will come’ is the adage that comes to mind. Additionally, we continue to pursue avenues to realize value for our exceptional exploration assets. Stay tuned!”

Our discussion gave a more comprehensive look at U.S. Gold Corp’s strategic direction, the exciting potential of the CK Gold Project, and the challenges and opportunities facing the company. George Bee’s extensive experience and insights provide a clear understanding of why U.S. Gold Corp. is set for success, even in the face of recent short-term market volatility. As the company moves forward with its projects, the mining industry will be keeping a close eye on its progress, eagerly awaiting the next chapter in U.S. Gold Corp’s journey.