Interview with David Mason, CEO of Dark Horse Resources (ASX: DHR) Dark Horse Resources is an Argentina-focussed mineral resource company with gold and lithium projects. Dark Horse Resources has ambitions to discover a multimillion ounce gold deposit and be a producer of high-grade lithium to help fuel the EV revolution. Dark Horse Resources intends to be a lithium hydroxide and gold bullion producer within several years.
Dark Horse Resources' share price is somewhat worrying. Starting the year at just AUD$0.008, the price has remained largely stagnant but for lows of AUD$0.003 throughout the year. It currently sits at AUD$0.003 with a market cap of AUD$6.88M; this is close to an 8-year low. The company has over 2Bn shares: a huge number that might be acceptable by Australian retail standards, but would be a major concern if listed on the TSX or AIM.
Dark Horse Resources has several projects in Argentina: Las Opeñas Gold Project, the Cachi Gold Project, the Central Argentina Lithium Spodumene Project and the San Jorge Lithium Brine Project. Dark Horse Resources is presenting various licences on these assets as an incentive to invest, but all are exploration risk stage and work has ceased due to the depressed state of the lithium price and lack of incentive for new entrants. If the company can afford to keep licences, permits and other services to maintain these properties in good standing, they may at some future date hold some value but there is none to be seen currently. There is a lot of talk of potential and hopes but nothing of substance yet: a familiar story with early stage junior exploration companies.
David Mason is keen to stress the management team is not involved with Dark Horse to make a quick buck: they are fully committed to seeing the project through to success. He explains that the management team has experience turning several small million-dollar companies into billion-dollar companies: encouraging news for any prospective investor. Non-Executive Chairman, Nicholas Mather, has been involved in the junior resource sector at all levels for 35 years. David has certainly earned his stripes too. There should not be concern as to the managements' general competency, but there are perhaps some question marks regarding their active specialised knowledge of lithium and gold mining. Dark Horse Resources is currently in the process of raising AU$1m for the purpose of beginning gold drilling at their flagship Cachi Gold Project, and Las Opeñas Gold Project. There are two ways to interpret such a raise: 1. Anti-dilutory, only raise what you need. 2. What in reality can $1M deliver before the company needs to come back to the market to raise more capital? Mason says he is 'certain,' we aren't so sure and it will be interesting to see if the market is as accommodating with this sales pitch. There is still a long way to go on the lithium front. Gold is clearly the focus here, but investors will note that few gold companies are seeing the current resurgence in gold affect their share price. Lithium exploration companies the world over are in deep waters. Research suggests that current South American producers will be able turn on the tap at will making life difficult for explorers. So Dark Horse has a lot of work to do to convince us it is the company to buck the trend.
The management team is clearly backing Dark Horse Resources; Mason claims they remunerate themselves purely via shares and have no salary whatsoever. We will check.
What did you make of David Mason? Is Dark Horse a gold and lithium lottery ticket you could take a gamble on? Is it all too speculative and risky? Comment below and we may just ask your questions in the near future.
We Discuss:
1:16 - Company Overview
2:03 - Investment in Oil & Gas: Why and What are They Expecting from it
3:39 - Argentina: Focusing on Gold or Lithium?
4:00 - Lithium: How Much Have They Put Into it, Where do They See the Market Going and What's the Plan for the Future?
9:34 - Team Experience
10:46, 15:10, 18:13 - Gold: What Have They Got, What's Their Plan for it?
12:06 - Cash Position and Financials: Are They Raising Enough Money, What's Their Burn-rate and Remuneration
16:47 - Share Price: What Can They do to Make it Rise Again?
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