Rule Symposium 2026: Rick Rule interviews David Cole, CEO of Elemental Royalty Corporation

Añadido: 2026-05-07

[00:00:01]This is Rick Rule for Rule Investment Media and the Rule Classroom, sponsors of the 2026 Rule Natural Resources Investment Symposium, July 6th through 10th in Boca Raton, Florida or via livestream from the comfort and convenience of your own home.

[00:00:20]However, you choose to absorb the information from the conference, know a couple of things.

[00:00:24]First of all, we're going to give you more information in 4 days than you can absorb in 4 days. Secondly, we're going to give you tapes of the whole or recordings of the whole proceeding so that you can absorb the information that we give you after the conference.

[00:00:41]Unlike any other conference I know of on the planet, we interview every exhibitor and every speaker who will be at the conference before the conference uh hosting those tapes at YouTube. The point of this is to allow you to come to the conference better prepared to allocate your time and your capital. We deal with the fact that we only have 4 days of the conference by stretching that 4 days over 12 months. Pre-conference interviews, post-conference interviews, and of course the recordings.

[00:01:11]Further to that, uh right now I have the pleasure of interviewing a friend of very long standing, Dave Cole. Dave and I have known each other for three decades.

[00:01:21]Yeah, that sounds We go back to a little private [clears throat] company called Southern European Exploration, if my memory serves me correctly.

[00:01:28]And I happen to be a shareholder of Dave's, and he has been a supporter of mine through Eurasian Minerals all the way up now till uh Elemental Royalty, a successor.

[00:01:39]Dave, let's begin the interview by you giving us a a brief bio of Dave Cole.

[00:01:46]Why should people who are listening to this interview care what Dave Cole has to say about the answers to the nosy questions that I will proffer up?

[00:01:54]You know, I it just popped in my head when you said that, um a trip that I did with Pierre Lassonde, um uh of uh Franco-Nevada in Turkey one time, and we're driving in Turkey. He was always talking about how you can't buy passion. Passion's the most important thing in the world. Well, if I trace back my passion, you know, I was a uh young lad in Colorado, and my grandfather owned the Black Hawk Placer Company dredging gold um around the turn of the century, and he taught me how to pan for gold when I was a kid. And the first time that I panned, and I watched that black sand and I peeled back, and I saw a couple of grains of gold in the pan, I got the gold bug, and I've had passion ever since. So, that's going way back in the history. But, uh you know, I'm educated in geology, economic geology. Newmont Mining Corporation was uh where where I cut my teeth on the corporate side for 18 and 1/2 years.

[00:02:40]Left to found this company and created our relationship, which has been productive for all of us. Um and uh uh I just love the value creation through the exploration and discovery process.

[00:02:53]You know, a mutual friend of ours, the man who introduced me to you, Borden Putnam, said as a young geologist he was trying to explain to you uh trenching.

[00:03:04]Uh I don't know if you remember this.

[00:03:06]And apparently you told Borden Putnam, uh "If you keep me in sandwiches and you keep gas in my truck, I'll trench from Reno to Wendover, all the way across the state all the way across the state."

[00:03:17]>> a lot We had a lot of fun back then. And we And you know what? We were finding gold.

[00:03:21]You found a lot of gold. We found a lot of gold. So, fast forward, uh you finally got out of the belly of the beast, if you will. I realize you have fond regards for Newmont, but you got out of the belly of the beast.

[00:03:32]Uh and you came to work for a fledgling explorer called Southern European Exploration, which you turned into Eurasian Minerals. Tell me something about the genesis of that. Tell me something about the prospect generator model, and tell me about the hybrid prospect generator royalty business that is in fact Elemental today. I guess that's one type of a hybrid, yeah. You That That model's been hybridized in a couple of different ways, but uh first of all um you know, while I was at Newmont, I saw people doing royalty generation, Lyle Campbell, a famous royalty generator, uh privately in Nevada. Um I saw other folks doing that in public vehicles, and [clears throat] I recognized quickly that that's an excellent business model.

[00:04:11]So, that business model is where you go out and acquire prospective mineral rights, which we all want to be exposed to because they augment in value over time.

[00:04:18]And then we work those by coalescing existing data, collecting additional data, illustrating prospectiveness of the asset, and then selling that on as a joint venture, or wholly selling that on, and keeping a residual interest.

[00:04:32]Now, that interest can be in a joint venture interest, where you have project equity that that the counterparty earns in over time.

[00:04:39]Um or it can be one where you sell 100% project equity and maintain a royalty, which is my uh favorite model for how to do that um because joint ventures become cumbersome when you have many many many of them, and we we have prospect generated literally hundreds of assets over the years, uh and we're delighted to own royalties on those. My opinion is that this hybridization towards the royalty model um is is particularly powerful because you have these teams that are astute out doing that prospect generation work, acquiring those prospective mineral rights that we all want to be exposed to, and the best way to be exposed to prospective mineral rights and royalties and the cheapest way to have royalties is through that process because you're selling those off, and and you have a de minimus cost that's invested in the asset.

[00:05:23]Um now, to augment that, and maybe this is where the word hybridization has greater applicability, but to augment that then, because we're building long-term discovery optionality at the base of the pyramid through that process, Rick, and then to to help create that cash flow at the top of the pyramid, we buy assets and create a fully uh uh filled-in pyramid. So, if you're buying assets at the same time as you're generating assets, you can be more picky and choosy about what you buy, making sure that you're allocating capital exceptionally carefully.

[00:05:56]Which we have a history of doing for 25 years.

[00:05:59]And that model has paid off in spades spades for us over the long haul.

[00:06:05]Tell me something now about you've combined with a another holding of mine, Elemental.

[00:06:13]Yeah, they're great guys. Tell me something about what the resultant company looks like. You know, the that mineral acres, where they are, the royalties, the cash flow, all that kind of stuff.

[00:06:25]All that good stuff. Well, first of all, let me just say that that in the royalty space, the market rewards scale.

[00:06:31]>> [clears throat] >> The larger the royalty company, the more each individual royalty is worth as part of a portfolio because of increased liquidity and the portfolio effect and the greater probability of discovery optionality working to the favor of the royalty holder.

[00:06:44]It's a It's a phenomena. We could argue whether or not that's justified or not, but it is. It's just a phenomena.

[00:06:49]Therefore, we're all motivated to astutely grow the size of our companies over time. We can do that through acquisition of individual assets, quickening the pace of royalty generation, etc. But the way to really take it to the next level quickly is to merge, but that needs to be done with a company of which you have excellent synergies. And we have those synergies with Elemental. And it was previously Elemental Altus, which was formed by two other companies that merged, one of which did prospect generation, by the way. And then and then EMX Royalty Corporation. And that created a company that's over a billion dollars market cap, over 200 royalties, 22 countries.

[00:07:28]And this year the analysts say we'll have close to 100 million dollars in royalty revenues coming in. So, this pyramid that has now been fattened through this merger is doing exactly what you would expect it to do where the assets are moving up and within the pyramid at no cost to us because we're free carrying as a royalty holder. And then that cash flow is coming through the main driver of the net asset value per share >> [clears throat] >> within the company is the continued discovery of mineral assets thanks to our counterparties and their astute allocation of capital and the increase in commodity price which has done very well, right?

[00:08:07]Commodity prices plural.

[00:08:09]Those two are multiplicative. So we have a situation where more copper and more gold are being found on our assets and the price of copper and gold are going up. Our net asset value per share is going up and to the right and of course that's driving analyst target price upwards.

[00:08:24]Dave, tell me or tell our audience more specifically because I think I know.

[00:08:30]Tell me something about the scale of your exploration holdings, the gross mineral acres, the number of joint ventures that you have that are active, the exposure you have to other people's money. It's truly staggering. I realize you've worked 30 years to be an overnight success but Yeah, so go right to the money question first and that's and that's a fair point but we're always trying to augment the amount of expenditure that our counterparties are putting into that prospective mineral rights so that we can realize the value creation. Over 100 million dollars a year in exploratory drilling across over 200 mineral actually it's actually it's over 300 mineral property assets worldwide and I have I apologize I do not know the percent mineral acres or percent mineral hectares within the portfolio but it's immense. It's a big number. I'm going to find out. So at the at the show in Florida I'll know that number but but it's a very very very large number. So we're in 22 countries, 300 mineral property assets, 100 million dollars in exploratory drilling.

[00:09:27]Now in addition to that hundreds of millions of dollars in mine development work.

[00:09:33]Sinking shafts, expanding open pits, building new mills on and on and on. So, we have that development exploration, or excuse me, that development upside to increase production on the assets in addition to ongoing exploration, finding large deposits and small deposits across the portfolio.

[00:09:50]You talk about the astute allocation of capital. Uh one thing that people don't remember too well about EMX in particular is that in addition to be being explorers uh and purchases of royalties, uh you guys have been pretty good allocators of capital. You've been in effect pretty good merchant bankers.

[00:10:07]Uh can you tell the audience something about the history of that uh and where you might go with that business?

[00:10:15]Happy to. So, we always approach things from a three-pronged standpoint, which has become more popular within the royalty space now. But, those three prongs, royalty generation, which we discussed, purchasing existing royalties, also some royalty financings, which my large competitors love to do, right? And that can be quite astute.

[00:10:32]But, the other thing that that EMX has done, and you will see Elemental continue to do, and that is to have blended deals that involve equity placements and equity deals in addition to the um the royalty side of the business, which you call merchant banking. And the history of EMX prior merger is we netted over $60 million USD um from our equity investments. So, we have this team of super smart geologists and engineers around the world identifying prospective mineral rights to acquire, also identifying royalties to be purchased, but also identifying stocks where we cannot not buy the stock because we're so intrigued by what is happening on the ground. Some of those were complete failures.

[00:11:14]Uh others were outsized wins, and the net result was uh you know, $60 million in profits. That's a lot of shares that that small company did not have to issue to create more capital in the bank to buy more royalties with.

[00:11:28]And uh that that model has worked exceptionally well for us, and I'm a strong believer in that multi-pronged approach because of the synergies you created through the team identifying these multiple ways to create value.

[00:11:40]Dave, I I believe for years I was the largest shareholder of EMX and I was the largest shareholder of Altus, but I've been supplanted.

[00:11:48]Uh by somebody called Tether. Perhaps you could tell me about your new largest shareholder and what other shareholders might stand to gain from the involvement in Tether and Elemental.

[00:12:02]So, we're at the confluence of the crypto world and the hard asset mining world. It's a fascinating place to be and Tether um the largest stablecoin company in the world and stablecoins are coins, digital tokens that are issued in exchange for USD or in exchange for gold.

[00:12:20]And then used as transactionally around the world and it's disruptive to banking industry because it's astonishingly inexpensive if not free to transact in those coins.

[00:12:30]So, it's become immensely beneficial to them as they issue coins, receive USD, invest that USD in order to back the value of that stablecoin in US Treasuries. US Treasuries yield 4% or approximately um and the stablecoin yields zero because it's being used transactionally.

[00:12:49]They reap the benefit of that. So, they're now one of the most profitable private companies in the world and making I believe over $20 billion a year.

[00:13:01]And they have specifically researched the world to figure out where to allocate that money towards and they have zeroed in on physical gold metal and on hard asset related royalties including gold royalties, but they're also keenly interested in copper royalties and farmland.

[00:13:17]So, they're reallocating within the hard asset space, which we find fascinating and it's my pleasure to work with Juan Sartori, the individual at Tether responsible for special projects. He's my chairman of the board. He's very enthusiastic. Talk about the value of passion. Juan has immense passion. And he loves learning more about this business and the power of the royalty model.

[00:13:44]They now own 32% of our stock, by the way.

[00:13:47]Very impressive.

[00:13:49]Uh Dave, uh thank you for three decades of effort on behalf of uh shareholders, particularly this shareholder. Uh thank you, too, for your long-term support of our conferences. To the extent that our attendees want to reach out to the company before the conference uh and learn more uh about Elemental Royalty, who in particular do they reach out to? And how do they find that person?

[00:14:17]So, uh Tara Vivian at Elemental Royalty Corporation, t a r a, um v i v i a n, Tara-Vivian.neal, n e a l. That's a long, complicated email address, I apologize.

[00:14:34]So, I was just thinking I should I should request that she simplify that at elementalroyalty.com.

[00:14:39]And uh uh [email protected], and you can send an email straight to me, and I'll take care of it. I It's my pleasure to speak with shareholders and prospective shareholders, particularly those within your uh tribe. And I've been doing this for a long time. Always enjoy speaking with those shareholders, but Tara and Dave Cole are the people to reach out to.

[00:15:01]dc@elementalroyalty.

[00:15:04]com. Uh ladies and gentlemen, I know from personal experience that if you send Dave an email, he will respond.

[00:15:11]You don't have to be named Rick Rule, by the way. He has responded to thousands, literally thousands of my clients and students over the year. So, the threat he makes is a threat that he will keep.

[00:15:23]Dave, one more time, uh thank you for all of your efforts over time. I look forward to hosting you in Boca Raton, July 6th through 10th, and I look forward to another decade of successful investing with you. Thank you.

[00:15:37]And thanks for having the best show of the year, Rick. Thanks very much.