Rick Rule: Top Mining Stocks as Gold Hits $4,000 - Rule Classroom Plus

[00:00:00]Welcome to the Rule Classroom Plus. This is Steve Barton and thank you for tuning in. This is where we take your questions and we ask Rick himself. Rick, how are you, sir?

[00:00:08]>> Uh, that's better. I'm fine. Uh, better yet for being able to hear you as opposed to read your lips. Thank you.

[00:00:14]>> Yes. This is a new microphone I got right in the front. There's a little button that'll mute it and sometimes I hit it when I uh pull it up. Um, okay.

[00:00:22]Uh, should we get right into it? Do you have any opening thoughts? uh only again to thank those people in the audience who uh attended the conference. It was delightful not merely to see so many people there but to watch them actively utilize the lessons taught in the rural classroom. It's what I had hoped the conference would become when I started it 31 years ago. And to watch the rural classroom attendees employ the lessons at the rural classroom, but particularly to form uh informal posies among themselves to uh interrogate the company's managements efficiently was very very gratifying to me. So for all of you, thank you.

[00:01:08]>> Yeah, it was a blast. I I I already can't wait for next year. It was a lot of fun. Best conference of the year. Uh okay, getting in on some questions here.

[00:01:18]Vig wants to know [clears throat] says by his rough math, CBridge trades at about 9 cents per dollar of NPV at $4,000 gold, implying the market assigns roughly 110 probability that KSM will ever find its builder. speculating wildly. Is pneumont with Bruce Jack and Red Chris all the already in the neighborhood the one that eventually writes the check? What do you think?

[00:01:46]>> Well, question eventually writes the check. Does someone eventually write the check? CBridge has suggested that they are now down to one party that they're negotiating with. They have refused to confirm or deny from me that that would be Numont. Using logical deduction, it would logically be a gold producer rather than a copper producer because gold trades at a higher cash flow multiple than copper. And looking among the major gold producers, the only gold producer that has a major investment in the region would seem to be pneumont. Uh so I suspect that the questioner's logical deduction is true.

[00:02:22]The spanner, if you will, in the discussion is that by identifying one company as the preferred bidder, uh Rudy likely has eliminated an auction. It's difficult to have an auction with one bidder. Uh and at $4,000 gold, I think the bidder is un under less time pressure than that bidder was under $5,500 gold. Uh, I suspect, although Rudy would deny it and has denied it in [clears throat] discussions that we had at the rule classroom, that the bidder can probably afford to wait uh until the resolution, as an example of the tutor conflict, or until the gold price rises, when he or she must begin to act more precipitously.

[00:03:11]Remember that the upfront capital cost of this project almost certainly now exceeds $7 billion and is perhaps higher. Note too that the mining industry itself has said that the inflation in upfront capex is running between 8 and% 8 and 10% a year.

[00:03:29]Similarly uh the increases in consumables and opex in particular fuel are increasing to a like amount. So it becomes a very important uh investment consideration. On the other hand with regards to pneumont if you look at their development pipeline and you look at the opportunities that they have to maintain uh their current levels of production there's no project in the world that offers new mod the same ability [clears throat] never mind to maintain production but in fact to increase production. So sorry for that wishy-washy answer. I don't have a yes or no answer. Uh I have really a discussion of the variables.

[00:04:12]>> Okay. Uh he asked about as a shareholder what risks or development should I be watching before adding to the position.

[00:04:18]I guess the tutor one is probably first first up right >> that and the gold price. Uh assuming that pneumont is the better bidder which is my assumption. I don't know it to be true. Pneumont will act in their interest. Pneumont is generating lots of cash lots and lots and lots of cash. So, they certainly have the ability to get this done. Uh, the question is, do they have the will?

[00:04:43]>> Okay, John wants to know. He says, "So many good companies at Boca Raton. Which ones have the most near-term upside independent of metal prices? I flagged Moneros and Luca for driving production up and cost down, then Arist and West Red Lake for production increased. Go Gold is a small producer via tailings, but to me it's a cash flowing near-term developer ready for a rerate. What What do you think of the ones he mentioned or do you have others?

[00:05:12]>> I I don't think in near terms. I don't do that. Uh I juxtapose what I see as the market cap relative to the value that I ascribe the company in three to five year time frame. So much can go wrong in short-term time frames that I found that by constraining myself to short-term outlooks that I confine myself to an unnecessarily small number of stocks and I expose myself also to all of the risks of time preference. So I don't think that way. Uh what I think rather is what I'm trying to accomplish with my own portfolio where there are holes in my portfolio and I try to address those holes. So I can't comment because my way of thinking is so completely d you know so completely different.

[00:05:56]>> Okay. [clears throat] Vig has a question. Uh mid-tier royalty triple flag and O royalty are both around $6 billion market cap. Triple flag precious metals screens cheaper per gold equivalent ounces with rising guidance and buybacks. O carries a premium for its development pipeline.

[00:06:17]Which premium or discount is the market going is is the market getting wrong and what is your ranking on these Rick?

[00:06:24]>> I think the market's getting both right and I note that they both trade at a relative discount via any metric to both Franco and Wheat Weaten. I think either the market arbitragees some of the value discount away or ultimately one or the other or both of those companies get taken over by one of the bigger ones. uh a truism is that your cost of capital uh is an important variable in mining. It's a capital intensive business and if the market doesn't arbitrage away valuation discrepancies, the market usually does uh by way of a takeover. I [clears throat] would suggest that for most portfolios uh after uh the owner of the portfolio has bought Wheaton and Franco that they consider if they've done the work coming down the valuation space uh and given the sophistication of the question that was asked I suspect that the questioner is in that position uh that they broaden their portfolio by acquiring uh either or both of [clears throat] triple and O.

[00:07:31]>> Okay. Um, we got a question. Let's see from Fritz says, "NG Energy, so they were out at the symposium, offers [clears throat] exposure to scarce Colombian gas, selling at a substantial premium to Henry Hub with strong reservoirs and well- capitalized operating partner. But it also has infrastructure constraints. Only a 39% interest in CU9 significant potential dilution and Colombian jurisdictional risk. At today's valuation does the market misunderstand and what per share outcome makes the riskreward compelling enough to buy rather than simply an interest interesting speculation?

[00:08:12]>> I like the Colombian assets. I'm familiar with them and I have been for 20 years and I believe that there is plenty of geological upside in Colombia.

[00:08:22]There are social and political risks in Colombia and there are also constraints with regards to infrastructure and political and social constraints around increasing the infrastructure. NG Energy is partially a speculation on the activities that they may or may not undertake next door in Venezuela and [clears throat] the backing that the company enjoys from some very sophisticated uh energy investors. I [clears throat] note in Venezuela that I have been involved in exploration projects in four times in Venezuela and I've enjoyed four successes 100% success ratio which is the most of any country in the world. On the downside, I've had all four exploration successes expropriated. [laughter] I've been nationalized four out of four times. I can't help myself. I want to go back. Uh, and I'd like to go back with the NG guys. Um, but it's highly speculative at this juncture.

[00:09:19]Okay. High risk, high reward. Um, Marco wants to know, this is very specific.

[00:09:25]May I ask Rick's opinion about Black Rockck Silver CEO Andrew Pard being recently fined for failing to report a 161 insider transactions? Um, what do you make of that?

[00:09:40]>> Uh, I have no comment on the specific incident, uh, although I've seen it reported. I I will say that if there's a pattern of misfiling, that's a problem.

[00:09:50]Uh, if [snorts] Mr. pollard was so busy with other parts of his life that he failed to fill out a form. Uh that has occurred to me. I don't know which it is, so I can't comment. Um I am always concerned uh about misinforming the market with regards to intention. I'm not sure that in uh in insider trading laws should be laws, but that's another question. to the extent that they are laws and you have uh an obligation uh to keep to them uh then you have that obligation but with regard to the specific question I don't have a comment >> okay so if you're a CEO like that you have to fill out one of these forms anytime you make a substantial purchase or sale >> Yep. Okay.

[00:10:34]>> You do depending on depending on the level of ownership that you have. I've had circumstances where I had to fill out uh forms about my intent to buy or sell.

[00:10:45]>> Never mind the fact that I do it. Um so yeah, you have obligations. I'm not sure that you should have obligations, but the market believes that you should and the market treats that obligation as a fundamental with regards to buying and selling. So until the laws change, I would suggest that executives have a duty to comply.

[00:11:03]Okay.

[00:11:05][sighs] Uh Ted has a followup here for Wheat and Precious Metals. Um it is not in your list of owned investments, but is in Rick's top three long-term along with Agniko Eagle and Franco Nevada. Let your descendants decide how to spend if I have heard him correctly. At a 32% discount from its high, it would seem to be a super core holding. Just want to confirm. What What are your thoughts?

[00:11:31]Absolutely. Uh uh there's some concern about management transition. I don't share that concern.

[00:11:41]Uh I know the new CEO and I've known him for 30 years. He's trained under Randy Small for a very long time and Randy stays on as chairman. So I'm comfortable with man management transition. What I particularly like about Weed and Precious is the fact that the street believes the big transactions are behind them. that the wonderful transactions that built Franco and Wheaten are think of the past which is wrong. Uh the future particularly the 250 billion constant $225 that the copper industry must spend to maintain production means that there is a huge future for streaming gold and silver cash flow from future copper mines. uh my size of the market estimates that there's 40 to50 billion dollars worth of streaming transactions to do uh and I think that the the the recent uh financing of BHP by Weeden uh is indicative of the opportunity ahead of them. Uh so it's difficult for me to understand why a precious metals investor wouldn't own Franco and Wheaton.

[00:12:48]>> And at these levels, do you think that Wheaton is cheaper than royal gold or the other way around?

[00:12:55]>> No, the other way around.

[00:12:56]>> Oh, >> but Weedaten has more upside opportunity than royal gold. Uh in fact the opportunity involved in creating the streams that will finance the copper industry is so big that those opportunities will have to be syndicated. Which is to say Weaten won't be able to eat the whole opportunity.

[00:13:16]Franco won't be able to eat the whole opportunity. They will almost certainly have to share those opportunities with companies like O uh and Triple Flag. And my suspicion is they may have to share them even farther down the food chain.

[00:13:31]So I think there'll be opportunity for everybody. But when people knock wheaten by saying that it doesn't justify the growth premium because there's no growth, those folks are exactly wrong.

[00:13:43]>> Okay. All right. You think I I think in your u pitch Rick you were saying even Verse might have an opportunity at that.

[00:13:51]I believe that the opportunity will so will come far enough down the feeding chain that private equity groups and hedge funds will be able to to participate. Uh but that remains to be seen.

[00:14:05]>> Okay. All right. Aram wants to know Schlumbumberge stock seems not reacting to the latest Iran escalation. Uh a hidden buying opportunity in oil stocks.

[00:14:16]What do you think? Uh the case for Schlumbumberge is not contingent on Iran. Iran is news. The case for Schlumbumberge involves the systematic underinvestment in sustaining capital by the oil industry for years.

[00:14:30]No matter [clears throat] what we do, Iran or not, we'll have structural shortages in the oil supply beginning, I believe, in 2029. And the only way to address those uh that underinvestment is to invest.

[00:14:44]and Schlumbumberge will be an absolutely prime beneficiary.

[00:14:48]Uh I'm delighted with the fact the better oil field service companies, the Hallebertton, the slumberes, the rigs have not moved as a consequence of the Iran escalation because it gives more time for people who believe that in the thesis the way that I do to avail themselves of the opportunity, they should not expect to be paid for attempting to avail themselves of that opportunity until 2029 or 2030.

[00:15:14]Okay, but you get a little dividend in the meantime. Uh Helen says, "Hello, Rick. Any comments on Ivan Hoe uh second half of 2026 and what it means when Riotinto backs off from the Sovereign project?

[00:15:30]>> Let's look at those uh in reverse order.

[00:15:33]Riotinto backed off of Sovereign because they sold out of the titanium business.

[00:15:36]They sold Richard Bay. uh there's no particular point in increasing their position in uh a deposit which is no longer of any use to them. Uh from my point of view that's probably useful. Uh I understand that getting paid now uh is in some senses getting it preferable to getting paid later. I was very concerned about the fact that Rio being the only bidder would be able to underpay for sovereign. I have always regarded Sovereign as a company where I will either lose 50% of my investment or I'll make 10 times my investment. My belief with regards to so to sovereign is that they will be they will continue to be able to be financed until uh if I'm lucky I make 10 for one. I'm cognizant of the fact that not having a Rio's money, but more importantly uh Rio's intellectual capital uh would have been a benefit, but they're leaving the sector. So that benefit isn't available to me. If the sovereign deposit is what I hope it is, uh which is to say uh the first or second most important routtile deposit in the world and the first or second most important graphite deposit in the world, the future will take care of itself over time. My concern really comes to the fact that the company's beginning to uh add rare earths in the story and my nervousness is that the the deposit is less than what I had hoped it would be in routtile or graphite. Uh [clears throat] and as a consequence of that, rare earth is entering the story. I have no evidence that that's true.

[00:17:18]>> Okay.

[00:17:20]They're a lot like uh Centurus and Meteoric, right? It's going to be a home run or nothing.

[00:17:24]>> That's correct. That's correct. I I would suggest that uh both Well, Centaurus in particular is further ahead. There's less debate as to the outcome there. You are more uh at at the mercy of nickel prices and what the uh final feasibility looks like.

[00:17:43][clears throat] >> Yeah, I've noticed that Satarus has probably gone down by 50% in the last couple of months, >> right?

[00:17:48]>> I just bought some more the other day.

[00:17:50]Uh oh, and Ivanho second half. Any thoughts?

[00:17:53]>> Uh the second half of Ivanho is what one would expect. They have to mine that deposit more conservatively. Uh and the output's lower. Uh that is beginning to be offset with free cash flow from the smelter. With Ivano, you're really thinking about four things. You're thinking about the value of the whole or the price of the whole relative to the value which is to say the net present value of the deposit over 30 years not to the half.

[00:18:22]Secondly, you're thinking about what happens when capushi comes online if capushi comes online. Uh for those of you who don't know the highest grade zinc deposit on the planet.

[00:18:37]Uh third, you are thinking about uh the Plat Reef uh the largest undeveloped uh platinum palladium deposit on the planet which is slated to come online the end of next year. We'll see. It's a big big big project. And then you're thinking about the exploration upside in the Western Forlands.

[00:18:56]uh I wouldn't focus so much on the half uh although it's delightful to see uh costs with regards to hydroelectric come down uh and revenues associated with the smelter go up. It's important to note that in the Congo lots can go wrong socially, lots can go wrong politically, lots can go wrong with the operation of the hydro plant. Um I mean a lot can go wrong. Ivanho is not a place for cowardly money. Uh it's a place for aggressive money. I represent aggressive money and I need to say I've sold enough Ivanho that I no longer have any uh cash balance in the position which is to say I've sold enough I have the rest for free so I can afford to be very patient.

[00:19:40]But I am very patient. It's a collection of assets that if they're allowed to mature, we'll see the development of a new major mining company.

[00:19:53]Okay.

[00:19:55]Um, William says, "I'd appreciate any comments Rick might have on Cinda Limited, a silver gold deposit in Wanowatau, Mexico."

[00:20:04]>> Don't know enough to comment.

[00:20:06]>> Okay. Vig wants to know your thoughts on Oceanana Gold, please. Seems pretty tight run management and organic expansion on the gold ounces every year.

[00:20:17]>> Well, Sienna's cheap. Uh my criticism of it is that it's a collection of tier 2 deposits. They don't have any tier one deposits, but they've done a very good job uh generating free cash flow. And that free cash flow uh both at Oiana and at B2 is selling at a substantial discount to their peers. My experience tells me that either that discount disappears by way of a stock price escalation or somebody takes them over.

[00:20:46]Okay, Eric wants to know, "Would love to get Rick's assessment and rankings of Forces Metals and Myriad Uranium." I have neither for either. Uh my concern for Forces has always been great. I'll be interested to see what John Borchoff is able to do there now that he's been installed as interim CEO.

[00:21:13]Myriad, I don't have enough information or I don't know enough to comment.

[00:21:18]>> Okay, Matt wants to know, "Hey, Stephen, Rick, what's up, Matt? How you doing?"

[00:21:23]Rick, are you bullish or bearish regarding Copper One Resources, formerly uh Giant Mining Corporation? Out of the four 2025 drill holes at Mabooha Hill, only two exceeded 7% copper, but in their favor, these two were shallow intercepts. uh less than 40 ft. I'm treating this junior explorer as exceedingly speculative.

[00:21:48]>> I haven't done enough recent work to have a comment.

[00:21:52]>> Okay.

[00:21:54]And Aram wants to know, Aubra Silver reshuffled its leadership today. Excellent Dean guys. However, it seems one of them has it seems none of them has ever constructed a green field mine, but they seem experienced successful exits. What are your thoughts?

[00:22:12]>> Uh I have a high regard for the people in Abra and I think that the team that they have selected is a team that enjoys the confidence of institutional investors worldwide [clears throat] and that this will be an important team an important team to accomplish the financing of this deposit. This is also a team that has substantial incountry experience in Argentina uh going all the way back to Argentine gold 25 years ago and I would suspect that that experience with Argentine sociology and politics will also be a ne necessary precondition. So I'm very attracted to this. I know the people involved. Uh I I know very well the operating regime that they were part of in the 90s and the early 2000s in the Lundine group that was [clears throat] an absolutely wonderful entrepreneurial environment and I'm delighted that people of that culture have [clears throat] moved over to Abra.

[00:23:20]All righty. Cal, what's up Cal? He was at the symposium. Good to see you. Hi Rick. Just following up on Recon Africa.

[00:23:27]What are your thoughts on the results from the three intervals of the deeper Ellen choke?

[00:23:34][gasps] Uh I'm not sure [clears throat] that with this completion that that lower formation is economic.

[00:23:45]What I like is the fact that there's live mobile oil and gas uh in the upper horizons and the lower horizon. To me, what this what this test did is it validated uh it validated the deposit.

[00:23:58]Whether or not this well works is a very different question. Uh the the size of the prize is truly enormous. Uh and the fact that in a target this size that there is confirmation of mobile hydrocarbons is extremely useful. What the stock does in the next three months, I have absolutely no idea.

[00:24:19]they're going to have to test it a bit more. And [clears throat] you know, it it could be that there were completion problems. Uh that is what kind of suggests itself to me, but I I would really need to invite uh our friend Keith Hill on to discuss that more thoroughly.

[00:24:38]>> Okay. He follows up with, also, there were some equipment issues that made it very difficult to capture flow rates.

[00:24:43]How does that shape your expectations?

[00:24:46]>> It's something I expect. I've >> Okay. I've been part of a lot of this well these wells in the past. If you think about what you're trying to accomplish, the fact that there isn't more equipment failure is absolutely amazing to me. That's why I say what's important to me is that it's validated the the target, not necessarily this completion was effective. I don't know that it was. I don't know that it wasn't.

[00:25:06]>> Okay.

[00:25:08]All right. Any rankings on Azimit? Also on their latest financing, they are financing at a beaten up share price.

[00:25:14]However, there's no warrants and five out of 7 million is at flow through priced at 40% premium to the market.

[00:25:21]>> I sold my estimate and I discontinued following them when they went from being predominantly a prospect generator to being predominantly sle risk exploration. [clears throat] Uh this is the second cycle where money was available to them from the market and they took it as opposed to being a prospect generator. I owned them because I thought they were a good prospect generator in Quebec, which I think is a good market to be a prospect generator in. But when they cease to be what I wanted to buy, I cease to own them.

[00:25:50]>> Okay. Any rankings on Fury Gold?

[00:25:53]>> No.

[00:25:54]>> Okay. Cal's back again. Uh, Mot's latest drill results. Inquiring minds want to know. Are you ready to share your opinion?

[00:26:04]>> Not yet. Uh, mixed. Uh the initial drill result was one of the better bore for drill results of this decade. Certainly got my mind. Uh it made me buy a little stock too. Ready, fire, aim. Uh the second drill result was mixed. One great hole, one okay hole, one dust. And I haven't been able to figure out from my own perspective how much of the target was negated by the duster. Uh that's why we have Steve Enders. Uh, and I'm giving him a little rest post conference.

[00:26:37]>> Okay. [snorts] Uh, do you follow Silver Bull Resources?

[00:26:41]>> I don't. I did years ago. Uh, that deposit had metallergical challenges that kept me away from it.

[00:26:48]>> Okay. Loose, what's up, Loose? Good to see you. She says, "I am wondering if the rise in the price of gold is a result of the decision by China to stop the paper gold trading."

[00:27:01]>> I don't think so. Uh I think they're trying to change the nature of gold trading in China. Uh which I like. Uh I think they're doing it for their own purposes. Uh and I think that they were concerned about some of the speculative accesses that were taking place uh in Chinese metals markets.

[00:27:22]>> So what are they doing? They're open up a new exchange and they're going to be basing it on physical gold or what what's what's the news? They're in they're encouraging uh transactions in physical as opposed to contractual gold.

[00:27:35]Um [clears throat] we're not supposed to make racial comments, but if you notice the proclivity for Chinese people in casinos and racetracks, you'll understand the concern [clears throat] that the Chinese government might have about the speculative mentality of their citizenry.

[00:27:51]>> [laughter] >> I got to experience that firsthand when I was a a rounder, a p a poker player in Macau. And those were some of the best games I've ever played. [laughter] But the most volatile >> the one of the truly strangest sociological places that I've ever been in my life was the racetrack in Hong Kong. Uh I have [clears throat] [laughter] it was clearly no place for the timid.

[00:28:15][laughter] Yep. Uh a fun game. I got to go back there. Uh, okay. Josh, what does Rick think about Surge Battery Metals and the lithium market right now?

[00:28:28]>> I'm a skeptic about lithium still. Uh, I will admit I'm a shareholder of Surge. I sold enough that I have the rest for free, which makes me a lot more patient.

[00:28:38]I think that Surge relative to other North American competitors has a decent deposit, but I'm concerned about the lithium market. Uh I'm concerned in particular about a technology I don't understand called direct lithium extraction. [clears throat] If the if direct lithium extraction works and were able to precipitate lithium out of saltwater brines uh as Exxon and Chevron and Oxidental and Mid-American all believe they're going to be able to do, it's going to be very very very difficult uh for the rest of the industry to compete. So I'm I'm concerned about that.

[00:29:15]I don't know enough to say that it's going to happen. I don't know enough to say that it isn't going to happen. And I like circumstances that I understand well enough that I can control in my own mind reaction to the probabilities which I don't have in lithium.

[00:29:29][snorts] Okay. Uh Tarso wants to know, "Hi Rick, when a project project generator retains a royalty on a project, it may take several years, maybe 10 or more for them to generate revenue. How do you evaluate these companies as net present value of distant revenues are effectively zero?

[00:29:51]>> I think the recent acquisition of the Almadeex royalty portfolio um [clears throat] by Empress Royalty is instructive.

[00:30:00]uh which is to say that experienced management teams are able to do probabilistic net present value uh assumptions and the consequence of that is that you can derive at least a market adjusted price for advanced exploration pro uh projects that likely won't produce revenue for 10 years but could 10 years from now produce really substantial revenues. the fact that a a [clears throat] a collection of non-producing royalties was able to be sold to an extremely knowledgeable buyer for $3.5 million despite the fact that there's no prospective cash flow says a lot about the royal about the value of royalty assets on a carefully chosen exploration portfolio.

[00:30:50]>> Okay. Uh let's see.

[00:30:53]Han wants to know, he's got a followup about sovereign medals. Uh, what's your ranking?

[00:30:59]I have sovereign at a five. Uh, I need I'm completely unconcerned about Riotinto, by the way. Uh, we need to get that out of the way. Uh, a lot of people were looking for a quick outcome, and I understand that people's time preference is real, but it doesn't matter. Uh I'm concerned about the maturation of [snorts] uh Malawian society to mining and I'm concerned in particular about the processed metal energy and the recoveries and the salailability of the produced products. Those are questions going to be asked in 18 in 18 months and they have nothing to do whatsoever with Riotinto.

[00:31:43]So, I'm suggesting that concerns about Riotinto are misplaced concerns. Uh, I'm not trying to say that concerns about sovereign are misplaced concerns, but the presence or lack of presence of Riotinto isn't your primary concern unless your only constraint is time.

[00:32:02]>> Okay, Chris is asking about hydrocarbon fungeibility in China. Uh, analysts are starting to report about China's increased hydrocarbon fungeibility.

[00:32:11]Basically, China has created an advanced technology that allows them to use many of the hydrocarbons interchangeably. I think he's talking about like what Doomberg was talking about how they can take coal and put turn it into diesel and stuff. Uh if this is accurate and technology allowing greater hydrocarbon fungeability is here and expanding over the next three years, then is this the type of technology that could minimize any structural deficit in the oil market? Thoughts?

[00:32:37]>> Uh three answers to the question. The first is I don't know. [clears throat] I get asked technology questions all the time and I'm very aware of my technological constraints. Note that most of my competitors aren't aware of their technological constraints which are just as great as mine. Uh the second is that the world is going to need a lot more of all forms of energy than most of us recognize.

[00:33:00]We have been operating as investors and financeers uh on the belief that demand for liquid hy hydrocarbons which is to say oil and gas is going to is going to peak uh in 2030 which isn't true. It's going to peak in60 or 2065.

[00:33:18]So we'll need more of all forms of energy. The liquification [clears throat] of coal is something a technology that's been in place for a very long time.

[00:33:28]South Africa during sanctions as an example had motor fuel sess which was a consequence of coal conversion. So that technology isn't new. [clears throat] To the extent that the Chinese are able to use some of their coal reserves, mostly lowgrade coal uh to replace some of their demand for oil and gas. I think it's to the benefit of China, but I don't think it detracts from the overall attractiveness of the oil and gas thesis at all.

[00:33:54]>> Okay.

[00:33:56]Josh wants to know, "What do you think about King Copper Discovery?"

[00:34:00]>> No comment.

[00:34:01]>> Okay. Um, is Aerys Minerals your favorite copper stock right now?

[00:34:07]>> No, Aerys is not a copper stock. They're a discovery stock. They drilled a really, really, really, really good hole. Uh, but they're probably a hundred holes away from understanding the deposit. Uh, it may very well be my favorite discovery stock right now. uh an increase in the copper price when you haven't proven that you have very much copper uh should not be of any benefit to you. What Aerys is is uh a group of people who had the good sense to go to a country Kazakhstan way before it was popular and assembled a team who understood both poor free exploration and Kazakhstan.

[00:34:46]uh who were able over 10 years to put together a great inventory of exploration projects, [clears throat] ran some geohysical work on one particular project, had a huge target, drilled it and drilled a spectacular hole drill hole. That big target and that great drill hole does not a mind make. Uh but it's a hell of a way to start.

[00:35:09]So if you're if you're interested in drill hole plays, >> uh and I can't help myself, I am. um you know the fact that you now have one measure of the third of the third dimension is an important variable but it's not a copper stock it's a discovery stock [clears throat] okay wants to know uh does Rick have an opinion on collective mining I see this becoming a 7 to 10 million ounce deposit am I in the ballpark or not 7 to 10 is aggressive but if you said four to five I'd be with you I'm not saying it won't be 7 to 10 I'm just extrapolating the data that I see uh I'm fairly familiar with collective. I own it. Uh it is fairly early in the development pipeline. So we're coming into the boring part of the las curve, you know, where we're trying to solve community issues and all that kind of stuff. But it does feel like the current share price understates the value the um the likely value of the deposit.

[00:36:16]Okay. Uh, Stefan wants to know, "Thank you. I was able to participate virtually." Awesome. Great. Uh, I really liked Riverside Resources. It seems to be a Rick Long a Rick Rule long-term favorite.

[00:36:31]>> Uh, if you could take risk. I mean, Jean Mark Stanny has been a friend of mine for a very long time. I tried to hire him. Uh, he wisely resisted, started his own company.

[00:36:42]uh they [clears throat] have not yet enjoyed any exploration success, but they have spun off enough companies and given me enough stock in the spin-offs that I have long since recouped all of my investment in Riverside and made a lot of money. Uh Jean Mark is an extremely good geologist. He's also a shrewd businessman and uh he's also honest. He's about to be a house guest of mine, which will tell you that I'm uh fairly fond of the guy. Understand that early stage exploration, even including prospect generation, which is the safest financial mechanisms for investors to participate, is a risky business and a time-centric business. If you're going to participate in prospect generation, uh I I would suggest that you build yourself a portfolio of four or five prospect generators. And I would suggest that uh Riverside uh is a very good likely component in that. for people who care more about the prospect generators.

[00:37:36]Uh our prospect generator boot camp at the rule classroom which you did two years ago is truly timeless content. Uh and I'm sure that uh the rule classroom would sell access to that either singly or as part of a package. And for people who are interested in prospect generators, understanding the methodology by which you evaluate prospect generators, I think is a really important way or pardon me, an important sort of precedent to constructing a portfolio.

[00:38:08]>> Yeah, I did a a breakdown uh of a hypothetical $10,000 investment into Riverside back in uh 2020 at you'd got it at 10 cents a share. Now it's at about 20 something cents a share. So, you got a double there. But what it doesn't show on the stock chart is the two spin-offs, Cappy Tan Silver and uh Blue Bluebird. Blue J.

[00:38:29]>> Blue J. Yeah.

[00:38:30]>> Yeah. And I by my back of the envelope math, it was something like your 10K investment was worth over 60 now because of those spin-offs.

[00:38:38]>> Correct. And it's important to note that two or three spin-offs occurred before Capitan.

[00:38:44]>> Okay.

[00:38:44]>> If you take the company all the way back, this is a persistent behavior by Jean Mark.

[00:38:50]Okay. And uh I think they have another one coming up here soon. Uh Raven, does that sound right?

[00:38:57]>> That's correct. And I see a note in the feed. Anybody who is interested in Riverside can talk to uh my favorite classroom student, Helen G, who has done a very deep dive [laughter] and has appointed herself as expert on all things Riverside, which is great.

[00:39:14]>> Yes. [laughter] Contact Helen for anything more. Um okay, let's see. I'm going back on some of these. Let's see. We hit that one.

[00:39:24]Uh, we hit that one. Uh, okay. Uh, William wants to know your opinion on Bravo mining.

[00:39:32]>> I love Bravo. Um, I'm a little concerned that they're going into the, uh, nickel business, too. Uh, I've known Luis Acavo now for about 20 years. I was introduced to him um uh by Nikki Adshaded Bell uh one of my favorite mining entrepreneurs.

[00:39:51]Uh he's a force [clears throat] of nature and is a great deposit. Uh I'm a little concerned that he's trying to do two things or about to be three things at once. My understanding is that they are spinning out the iron oxide copper gold potential uh on this deposit into a new company that you will automatically get shares in. But I think this is one of the best undeveloped um platinum and palladium discoveries in the world in the last 10 years. I think it's important too that you have a discovery like this that doesn't expose you to the political risk of South Africa and Russia. different political risk in Brazil to be sure but traditionally platinum and palladium investors have had to accommodate themselves to social and political risks in uh South Africa, Zimbabwe or Russia and I would rather take that risk assuming that the rewards were similar in Brazil.

[00:40:47]Okay, Yang Yang was at the conference. So what's up Yang? Uh you mentioned that Ned Goodman was an early mentor of yours. What were the main elements of his investment style or thinking that your classroom could learn from and apply to our own investing? And how does that differ from your own style or just pontificate?

[00:41:08]>> Uh he helped [clears throat] build my style. U Ned was a value investor. He didn't show it, but he was a credit analyst, too. uh and most exploration investors look solely to the upside. Ned measured the downside as well as the upside. Uh Ned was also very adult with regards to risk. Uh he was willing to accept the possibility, sometimes even the probability that he would lose 50% of his money, but he would only do that in circumstances where he felt he could make 10 or 15 times his money if he was right. So, the very sober assessment of risk versus reward was good. Uh, Ned was also an extremely fair-minded individual. At the point in time when Ned began to mentor me, relationships in Toronto financial circles between Jewish people and non-Jewish people was less good. Uh and Ned was very willing to overlook the fact that I was a gentile uh and mentor me and trust me uh irrespective uh of my own background. Uh Ned also was consistently fair.

[00:42:25]uh Ned I if you put Ned into a deal and then you came out of the deal I mean the first question he would ask you is you know I'll do what you want but am I being treated the same way that you're treating yourself uh and he believed in treating everybody in the organization well he reminds me of Robert Quartermain in that regard when Ned Goodman assigned options in Dundee Bank he didn't hog them all the receptionist got some uh which meant meant that people were uh proud and aggressive about wearing the Dundee jersey. He was a real team builder.

[00:43:07]>> That's cool.

[00:43:09]Uh okay, Han, could you comment on Canora Copper and what ranking do you have?

[00:43:17]>> Canor is an early stage prospect generator. They've done a good job staking projects. they've done a good job bringing in uh third party funding commitments to yet they haven't made you know yet they haven't made a discovery.

[00:43:29]So I have them in that great five category uh hold category with a whole bunch of early stage prospect generators. I wouldn't own uh any prospect generator in isolation. We said earlier in conjunction with the discussion of Riverside, if you're going to be an early stage grassroots exploration, if you're going to take the risk and if you're going to use the prospect generator to play the probability game, it's important that you build a a portfolio four or five or six, not just have one.

[00:44:02]>> Okay, Nick and Diane want to know about Fortuna Mining and Eagle Plane.

[00:44:08]I have both Fortuna and Eagle Planes as fours for very very different reasons.

[00:44:13]Fortuna is an operator which has successfully made the transition from high-grade uh underground South American predominantly silver but silver gold mines to a much more globally focused but increas increasingly West African operator uh in open pit environments.

[00:44:34]It's difficult to change operating theaters. it's difficult to change mining methods and Fortuna seems to have done it. Uh they're also cheap uh as a consequence I think of the political risk. They've done something to mitigate the political risk which is to say that they're in five countries regarded as lousy countries as opposed to just one country that's regarded as a lousy country. Uh but the fact that those countries are regarded as lousy countries, I don't believe them to be by the way. uh has uh negatively impacted the market capitalization.

[00:45:08]>> Okay. Uh getting close here. We got about 10 minutes left. So if you guys are watching on YouTube or X or any other outlet, we're pulling the questions from the Rule Classroom Plus students. So follow the links down below. Head over to the real classroom or if you're watching the replay, come on over and participate in the next one.

[00:45:25]Josh wants to know, "What are your thoughts on King Fisher medals?"

[00:45:30]I'm attracted to King Fischer. I don't own it. Uh the fact that Bareric came in having no assets in the region. Uh with a very very very generous above market bid says an awful lot. Um certainly when I look at the size of the prize, uh this is attractive. Now people need to understand this deposit is in the middle of nowhere. Uh fact it's a long way from nowhere. While the region itself enjoys a lot of favor, the region being the golden triangle, uh these guys are in a remote and very very very rugged part of it. But the size of the prize is truly amazing. And I'm impressed with the fact that Beric uh which has no operations anywhere near this thing uh is involved. Uh that tells me that the geological staff at Beric, right or wrong, has done [clears throat] some work on this and they were very aggressive with their recommendation.

[00:46:29][snorts] Okay, Vig wants to know, he says, "Thanks for bringing Amergo to the copper boot camp." Uh he likes that one.

[00:46:37]Uh he says he met Jason at from Magna Mining at the Bokeh Raton and the project seems well positioned to improve copper production and he says $120 million investment from Alpana for expansion. Um what what are your thoughts on uh on that financing?

[00:46:56]>> Uh I thought it was a useful financing.

[00:46:58]I uh probably would have preferred for them to raise a little less money uh and uh remove some of the risk associated with the deposit and raise more money later.

[00:47:12]I need to say though that mining that management team uh has done a great job for years not just in their current in incarnation uh but going back uh in terms of deploying capital well in the Sudbury basin. I believe that what you see is that that $120 million in application will allow them to advance these projects to the extent that they will be able to use that that success to acquire adjacent properties. I mean, what they're really trying to do is uh acquire substantially all the distal mineralization in the Sudbury basin. Uh and I think that this $120 million gives them some strategic advantages with regards to that. I'm delighted that uh Jonathan Goodman uh at Dundee is the godfather here, which is to say sometimes when somebody takes on $120 million uh they become a bit frivolous.

[00:48:14]I don't think that Jason would be a would be particularly frivolous, but the fact that he has Johnny Goodman sitting on his right shoulder uh probably ensures that. [clears throat] Do you think they'll be able to take that money and become cash flow positive after it?

[00:48:32]>> No.

[00:48:32]>> Okay.

[00:48:33]>> Uh I think it'll take a bit more than that to become cash flow positive.

[00:48:36]>> Okay. All right. Okay. Uh where are we?

[00:48:42]What does Rick think about Tillmore Mining Corporation and the coffee deposit?

[00:48:48]>> Uh the coffee deposit I know fairly well.

[00:48:52]I I was involved in that. I was involved in discovery. I was involved in uh big finance IRA Thomas uh in the sale. Coffee deposit is a good deposit. Uh I will look forward to seeing the updated feasibility study particularly with regards to infrastructure access and degress. You know whether or not they're going [clears throat] to propose to build a a bridge a highway into there or whether they're propose whether they're proposing to use riverborn transportation. Uh the deposit itself is good. The infrastructure is challenging.

[00:49:28]>> Okay. Uh let's see.

[00:49:32]Do you have an interest in Palag Palagio?

[00:49:36]>> Palangio.

[00:49:36]>> Pelangio.

[00:49:37]>> Uh I am a shareholder again from an old movie again. I've enjoyed enough share price appreciation that I've sold enough stock that I have no net investment in Palangio.

[00:49:48]Uh what attracted me to Palangio was you know really uh the historical advantages that they have in the Abbot Tibby and the fact that uh what we learned last year at our conference from Amaral Jundi is that the smaller deposits in the Abbott Tibby which were orphans in earlier years because they weren't large enough to amvertise a mill won't be orphans this time around because enough new infrastructure has been built in the Abatibby the deposit which is fairly adjacent to existing productive infrastructure can be put into production without a mill.

[00:50:26][snorts] >> Okay, Thomas wants to know, "Hi, Rick and Steve. Thoughts and rankings on Luca? It dropped a lot in price recently."

[00:50:34]>> Uh, I like the fact that it dropped in price. Uh, it allows people who believe in their thesis to buy more. I'm still concerned about the fact that the management team has two companies uh gold group or or uh you know gold group and Luca and I won't be buying more Luca until they combine the two companies. I want to know who the management team is working for each of Monday, Tuesday, Wednesday, Thursday and Friday.

[00:51:00]Um [clears throat] I'm troubled too by the fact that both the deposits are small deposits. There's no big deposit.

[00:51:07]I'm attracted to the obvious competence that this management team has in buying underutilized assets in Mexico that are misunderstood by gringo owners uh and by lavishing love and attention and local knowledge and making these deposits produce well. There's more work to do at both of the deposits. The allin sustaining costs that Luca enjoys, if that's the right phrase, uh in Guerrero and at Tutoto are still much too high for me. And the deposits are at present still much too small, but I like the management team and I like the perspective upside. I'm not going to increase the size of my position in Luca until they either uh drive down all in sustaining costs substantially or merge with their sister company.

[00:51:54]>> So gold group mining they just formed recently, right?

[00:51:59]>> Yes.

[00:52:00]>> Okay. All right. I >> it itself is the result of two other companies. Uh there needs to be a three company amalgamation. So far there was a two company amalgamation.

[00:52:09]>> Okay. Okay. And then once he can pull in >> if he can do it. Okay. [laughter] >> All right. [gasps] Okay. Uh let's see.

[00:52:20]Theo said you said you're going to Argentina. Can you elaborate on the schedule? Is this a Doug Casey specific trip? Uh or is this a student classroom thing? Uh the idea had been that a lot of people in the classroom have expressed interest on in going on a mind tour. Uh something I've enjoyed. Uh and in putting together mind tours, I decided that having Barb and Michelle as partners, uh people who put on high-end tours around the world that I would what I would try to do is construct a tour that was at once fun uh but also beneficial. Kathate came immediately to mind because it's a wonderful town and I could probably hoodwink Doug Casey and David Glandon speaking there which would be useful. Uh it also affords access to the Salta Altaplano. The difficulty with that that occurred to me at the conference is that the majority of attendees in this trip would probably be over, you know, over age 70. And the idea that I would take 30 people over age 70 up to 4500 meters uh suggests that of the 30 I took in 27 would get out. And I've begun to rethink that idea uh in favor of mind tours that were less physiologically challenging to an older audience.

[00:53:41][laughter] >> That's probably a really good idea.

[00:53:44]Uh okay. I think did we hit all the questions here? I'm running through.

[00:53:48]We're tapping on the hour. Um, do you have any uh closing thoughts, Rick?

[00:53:53]>> I don't. Uh, other than those of you who weren't able to attend the conference, remember that you can do so retroactively.

[00:54:00]Uh, if you buy the recordings, which all of us that attended the conference are going to have to play anyway. There was way too much information at that conference to get everything that you could out uh buy the tapes. Uh, and if for any reason you don't think the recordings are worth your while, email me and I'll give you your money back.

[00:54:19]Uh, there are very few riskless uh, financial transactions in the world.

[00:54:25]That being one, the [clears throat] second, and this is another commercial. Well, two more commercials, frankly. Uh, next year's conference is going to sell out pretty [clears throat] quickly. Uh, I think we met or exceeded everybody's uh, expectations this year. Uh, we sold out this year because we did a good job last year. We did a good job this year, so we're going to sell it next year.

[00:54:45]That's the way it works. Uh, if you can't come live, live stream is a wonderful alternative. But the people who I talked to this year who attended live, who had attended via live stream in prior years said that there were sub substantial advantages to being there in person. So, to the extent that you want to avail yourself of next year's conference, uh, get your reservations in regularly. Uh, contact Barb and Michelle, get yourself on the spot. For those of you who were unable to attend this year, the tapes while they were not as good as being there real, you know, being there in real in real time are very useful and as I say, it's absolutely a riskless transaction.

[00:55:24]>> Well, second is that >> Oh, go ahead.

[00:55:26]>> Go ahead.

[00:55:27]>> The second is that Battle Bank after years of gestation is in business now.

[00:55:32]Uh we're growing that bank to the tune of about a million dollars in deposits a day and about 200 $250,000 in gold deposits a day. It's a community bank that's designed for this community. Uh if you aren't part of BattleBank, become part of BattleBank. It's the only bank that I know of that if you experience any difficulties with, [laughter] you can email the company's co-chairman.

[00:55:55]He's this guy named Rick Rule. Uh and he will not take customer complaints likely lightly, pardon me.

[00:56:03]>> Okay, we'll put the links down below if you guys want to watch the replays of the symposium that is down below. And uh is do we know the dates yet of the 2027 symposium?

[00:56:13]>> Uh I need to plead guilty of senility. I have been told them. I signed the con the the contract. They're going to be effectively the same as this year's dates. Uh you know sort of the 6th or 7th through the 10th or 11th. It will be back at the Bokeh Resort. And I think the Bokeh Resort has done an increasingly good job of hosting our event. uh they've [laughter] they've become used to us. Um they're very covetous of the bar sales uh at the end of the conference every day. So they're beginning to treat us better. Uh Helen Helen G says uh that the conference will be taking place July 5 through 10. Thank you Helen for that.

[00:56:55]>> Okay. Awesome. Thank you Helen. Okay.

[00:56:57]Yeah. And just to put it in perspective, this year I bought my tickets uh in January and I almost didn't make the cut off of getting a rumor on the boat cruise. So that >> and I have to say if you want to go on the boat cruise, uh I could sell it to Queen Mary for that boat cruise. Uh we're going to get a bigger boat next year, which is a good thing because there wasn't room to move.

[00:57:19]>> Yeah.

[00:57:20]>> On the attendee boat cruise. Uh but if you want to go on the boat cruise, I'm not suggesting that you have to, although it was an awful lot of fun. If you want to go on the boat cruise, god, get in early. I I I I encountered more hate about the soldout tickets on the boat cruise than any other as in fact, that's the only aspect of the conference I did encounter any hate about.

[00:57:40]First world problem. Okay, coming up in the pipeline today in about uh what was that two and a half hours, we've got Adrien Day in the Real Classroom Plus and then next week on the 29th, we've got Joel Litman. And at the end of the month in the regular rule classroom, we will have Rick taking questions again uh with Albert. That will be on July 30th at 12:30 Pacific time. Rick, thank you very much for your time. This is always a pleasure. You have a wonderful rest of your day and um thanks for being here.

[00:58:11]>> Pleasure, Steve. It was a a huge uh uh pleasure for me to host you personally in Boca Raton. So, thank you for being there and thank you for your efforts on our behalf in the classroom.

[00:58:23]You're welcome. You're welcome. It's my pleasure. And thank you for being a Rural Classroom Plus student. You have a wonderful rest of your day and we'll talk to you next time. For more content like this, check out these videos right here.