Episodes

Dan Ferris:                 Hello and welcome to the Stansberry Investor Hour. I'm Dan Ferris. I'm the editor of Extreme Value and The Ferris Report, both published by Stansberry Research.

Corey McLaughlin:    And I'm Corey McLaughlin, editor of the Stansberry Daily Digest. Today, we talk with Benoit La Salle, president and CEO of Aya Gold & Silver.

Dan Ferris:                 I last spoke with Benoit last summer at Rick Rule's annual conference in Florida. We had a wonderful conversation. We're going to cover some of those topics and a lot more. And I promise you there's a lot in here that you've never heard before that you will find very, very interesting. So let's just get on with it, let's talk with Benoit La Salle, let's do it right now.

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[Music playing]

Dan Ferris:                 Benoit, welcome to the show. Great to see you again.

Benoit La Salle:          Thank you for inviting me. And, yes, great to see you at this unbelievable time for precious metals. So, I'm glad to be on the show with you.

Dan Ferris:                 It is. So, I think for our listeners' sake, you and I have talked about some of these things at Rick Rule's conference, maybe, what, last year or the year before, I can't even remember. But we'll have to go through those again, because I want our listeners to get the full story on Aya Gold & Silver, your company. And I have to start in one particular place, which is the place where you are mining, which is totally unexpected. When somebody said, "Well, yeah, they're in Morocco," I just thought, "They're mining in Morocco?"

It was just totally – I didn't know Morocco was anything like a good mining district. But that's where you are, isn't it? So the question becomes why Morocco? Why Aya Gold & Silver? And why in Morocco?

Benoit La Salle:          Well, you know, in mining, you want to be the first mover, you want to be there early. We were early in Burkina Faso, we did extremely well 25 years ago. Morocco had this law, for 100 years, that, you know, natural resources could not be owned by anybody else but by the state or by the royal family, and so nobody has looked at Morocco. And it opened up ten years ago, when they decided to let people in, and nobody really went in but one company, which was Aya, which was put together by somebody before me.

And they obtained fantastic assets. The Zgounder Mine is one of the best in the world, the Boumadine project is probably one of the most impressive projects right now in the world, and there's much more coming, we keep adding ground to our portfolio. But Morocco is as good as Ghana, as good as Canada, it's a VMS belt. It's actually a lot longer than what we have in North America; it's 1,600-kilometers-long − so, what, 1,000 miles of a VMS belt that's never been looked at. We bring geophysics for the first time on the ground that we own and we see very, very strong anomalies that we drill and where we find mineralization.

So, you're right. Morocco is not known because it was out of touch, it was out of sight for 100 years, it's not opening up. But I can tell you now that there was a conference in November in Marrakesh and, wow, it was busy. And people were in looking at what we have, at additional ground, and what the government has, and it was a very busy conference. On top, the Saudi conference, Futures Minerals [Forum], in January, where you have 20,000 people, there are ties between Saudi Arabia and Morocco, and whoever works in Saudi likes to work in Morocco.

So, that's also really kick-starting the exploration in both countries, what's happening in Saudi is quite amazing, what's happening in Morocco now is picking up speed. But you will see, over the years, Morocco will become a top-top mining jurisdiction, because of its mining code, because of the fact that the people are excellent, they're well-educated, because of the phosphate industry, which is the largest in the world. So, you're right, for many people, when I say Morocco, some think Monaco. They say, "Oh, is there mining in Monaco?"

I say, "No, no, no, not Monaco. Morocco. It's just on the coast, you know, on the Atlantic and on [the Mediterranean]." And, you know, the mining is south, it starts in Agadir, and it's a mountain range and it looks like the [Rocky Mountains]. The Atlas Mountains go up 4,000 meters, and you have snow and you have – but it's a VMS system, so, it's volcanic, it's massive sulfide, and it has everything. It's got copper, big copper project, the most impressive silver mines are there, with Zgounder and Imiter. It's got pure cobalt and it has beautiful gold. So, it's a very well-mineralized system, but it was not looked at, ever.

So, Aya is with Managem, which is state-owned, so that's a different discussion, but Aya is the first mover in that country. It's the only company, right now, with a substantial portfolio already in production, cash-flow positive, making money in Morocco.

Dan Ferris:                 It makes me wonder if there's any other country in the world where this could potentially happen, where the government is currently not so friendly toward mining. But it contains a lot of minerals, and if it ever changes, it would be another situation like this. Is there any other place you can think of that might be like that?

Benoit La Salle:          Well, one that's turning the corner is Saudi Arabia. I mean, you know, Saudi, you had one company, Ma'aden, that was there forever, doing all the work. And now they're opening up, so Ivanhoe Electric is there now with a big contract. And you have, now, at the conference, we could see it, all the companies coming in, Barrick is now in there, and Saudi Arabia is a little bit like Morocco where nobody was there for years. Now the difference is, in Saudi, they give you the money for you to do the exploration in their country.

So they become shareholders, they give you the money, and then you spend it back in-country. In Morocco, they're not there, they don't have the same oil reserves as Saudi Arabia.

Dan Ferris:                 Right, they don't have a massive amount of capital. So, Morocco is just a great mining district, now. And you are the first mover, as you say. First mover is not necessarily a great advantage in technology, but it sounds like a fantastic advantage in mining. It sounds like the ultimate advantage in mining.

Benoit La Salle:          You know, mining, to me, is a bit like biotech research. It's, if you're the first one looking for that drug and you find Ozempic… well, you found Ozempic. And then, you go from 20 million to 700 million. Mining is the same, is you're looking for Ozempic, but if nobody else was there, look at our Boumadine asset, it's 6-kilometers-long, it's from surface, it's well mineralized. People have been walking that ground for 2,000 years, they have walked toward the structure, they saw it, it was there, it's outcropping, and they were mining it, you know, with shovels and picking up the lead and the zinc.

And they would throw out the gold and the silver, because they did not have the means to recover that. And it was outcropping. So we go in, now, with geophysics, with satellite imagery, with the right tools, and we go, "How come this is still there?" And then you go to the government and all the land around is available. So if you look at us at Boumadine, in what country do you go in where you have a 30-square-kilometer mining permit, and now we have, within two years, we have 800 square kilometers? Nowhere.

Dan Ferris:                 Eight hundred, wow, OK.

Corey McLaughlin:    Yeah, and you're talking about silver, in particular.

Dan Ferris:                 And just for our listeners' sake, outcropping means that you're walking along and the mineralization is just sticking out of the ground. Literally, you can see it sticking out of the ground. So, it's virgin territory what we're describing there. Corey, go ahead.

Corey McLaughlin:    And when you're talking about outcropping, too, you're talking about the Romans back in the day, right, walking around finding silver in the hills, right?

Benoit La Salle:          Well, you know that's what happened in Morocco… [crosstalk] Discoveries were made by the Romans, 2,000 years ago. Zgounder, our mine, was discovered by the Romans. We have documents going back 900 years on the production of Zgounder. Can you believe this? And we still find artifacts that go back, we don't know, over 1,000 years, onsite. And now sometimes we're mining underground, we're developing, and we, oops, we hit a gallery that we didn't know was there. That was opened 1,000 years ago.

Corey McLaughlin:    That's fascinating.

Benoit La Salle:          And now [inaudible] Morocco, try to do that in Europe or in North America, they would stop you for two years, to do the investigation on this new gallery, which they would try to understand and look at artifacts. I mean, Morocco is, "We found a new gallery. Here it is," and we go into it, we take a look, and then we move right on. I mean, the beauty of Morocco is they're not bogged down with the whole ESG − and though you have to respect that − but, you know, they don't stop you for two years to do the investigation. If you were in Quebec and you hit a situation like that, they would stop you forever.

Corey McLaughlin:    What I was going to ask originally was, with silver, why are you so excited about silver today and the macro case for it? Maybe you can explain to our listeners about that.

Benoit La Salle:          Well, look, I'm very, very excited about the silver. I am, I'm thoroughly excited. We are a producer, you know, we are producing a lot of silver this year. We see the inflow of buyers coming to us right now, they are short silver, they need silver. Silver is a commodity that's been suppressed, it's a commodity that's been managed, it's a commodity where the paper trading has a multiple or a multiplier of 365. So, every day you trade as many ounces of silver as you produce on a yearly basis, so that's that multiplier of 365.

Silver is an overmanipulated commodity, because people were trading it and they were making money. And like gold was, until the Federal Reserve started buying two, three years ago, and when Turkey started buying and Poland and then Russia and then China, then people could not manage it and then it started to move up. We haven't seen that. You take a look at today, gold was $2940 and silver was still $32. So we're approaching a ratio of 100, the ratio between the silver price and the gold price and that doesn't make any sense. So, it's, historically, the average, like, 60.

So it will, at one point, move up, but right now, the focus is on gold, because China, the Chinese insurance companies now are allowed to buy gold, so there's a massive pressure on gold. And people don't think, right now, as a financial asset, that silver – and I'll come back to silver – they think of gold. And we all know that, to stabilize the financial market, gold will have to be much higher. Because if gold's much higher, then the U.S. has less debt that's unsecured, because they have gold. The Chinese have a lot of gold, the Russians have a lot of gold.

And the world is being divided between these three parties, which is Russia, China, and the United States, and their only way out of this extreme deficit is reevaluating their gold reserves. So that's coming. I mean, the writing's on the wall, that's coming, and it's coming quite faster. You saw Goldman Sachs, yesterday, change [their] target to $3,100 for this year, and that's a big move. So that's coming. And at the same time, people say silver is like a little dog on the leash which is being carried up by gold. So, gold's going to pull up silver, and the demand, as well, is there.

Now we're coming to the end of the inventory for silver, and then people will realize that silver has got two things. It's an industrial asset; it's also a financial asset. Right now, the big, big move is as an industrial asset for solar panels, AI chips, armament, health care, communication, all of that − the demand is extremely strong. But it's going to come back, also, as a financial asset. The day the world says, "You know what, I'm starting to buy silver as a financial asset," there's no supply. And that change is coming.

I had a call this morning, before we talked, a very large institution kept saying, "Hey, we want exposure to silver, because we think this financial asset is coming, the demand as a financial asset, and then there will be no silver left." And you'll see silver go back till $60. If it goes to $60 and gold is $3,000, well, you have a $50 silver price, and that would make a big difference. It would make a big difference in the market, I think people will stop shorting it and playing around with it, because the financial demand is going to really pick up speed and will make it very hard to buy silver.

We're seeing it, we're producing quite a lot this year, and people are calling trying to sign long-term agreements with us on supply, silver supply. So, I'm very, very bullish on the silver price. Is it going to take a month, two months, six months, we don't know, but it's coming. And as the gold, you know, readjusts itself as a financial instrument, silver will follow. Sorry, it's a long answer, but I sure believe it's coming.

Dan Ferris:                 It's a good answer, it's a very good answer.

Corey McLaughlin:    Good answer, yeah.

Dan Ferris:                 And we've discussed silver many times, well, at least a few times in the past year or so, on the program. And historically, if you look at that long-term chart of silver, it's a really spikey chart. Silver tends to − it'll disappoint you and then spike up after gold has made a big move. So, that's the dynamic that we kind of look for with silver, and, boy, are you in a good position to take advantage of that. But you produce gold, as well, right?

Benoit La Salle:          Right now, we only produce silver. Right now, [crosstalk] –

Dan Ferris:                 Oh, only silver.

Benoit La Salle:          – is 100% silver, which is extremely rare, and it's very high quality. So, again, yesterday, I was in discussion with the refineries and they're billing to get our silver, because they say, "It's so pure that we use less energy to make it 99.99." Because we ship it to them at 99.2, 99.3, from the mine, which is extremely rare. There's no nasty elements to it. Actually, our silver is pure, we are mining, and this is typical of Morocco, you have pure native silver mines that were put into place 550 million years ago when this volcanic belt was put into place. And it's extremely rare to see that.

So there's two of them, one called Imiter, which has been in production for 50 years, owned by the royal family, the company's called Managem and they've been running this for 50 years. And there's Zgounder, which we have. So it's pure native silver, it's 100% of our production for the coming four to five years. And our second project, called Boumadine, there, you will have gold and silver, lead, and zinc. So, there's going to be a little bit of lead and zinc, and then the majority of the production will be gold and silver. But that's going to come in four or five years, but for the next, you know, mine life of Zgounder, it's pure native silver.

Dan Ferris:                 OK, I see, I was misreading the map. So, I was looking at a map in your latest presentation and there is, what, another project called Tirzzit, which is a copper-gold-silver project, near Zgounder?

Benoit La Salle:          So, you're right, but that's not yet in production. So that's a gold-copper-silver deposit, which has been mined over the years, same thing, by the previous owners. We bought that and we're doing some work there. We are looking at, is it big enough for us to put the infrastructure to truck it over to the plant? Because at Zgounder, we have three plants. We have two leaching plant and one floatation plant, so we have capacity, if ever we found a structure that would be polymetallic, we have capacity to treat it.

Dan Ferris:                 I see. And while I'm looking at it, so I see Zgounder, Tirzzit, I see Boumadine – something called Imiter bis?

Benoit La Salle:          Yes, so, in French, bis means junior, No. 2, [laughs] in French, Imiter bis. And we're right touching the main Imiter mine. And the Imiter mine, which is owned by Managem, have discovered, over the years, close to 500 million ounces of silver, and have been in production for 50 years. And in our portfolio, we have that permit, which is called Imiter bis, so Imiter junior. So we've done some work on it, it's got some very nice structures, it has some gold, which they don't have at Imiter.

So we're keeping it, it's not a standalone right now, so we're keeping it. We're looking to add ground around it, as well, but we're right beside, I think, one of the most beautiful silver mines in the world, which is Imiter, and so we're keeping it. So that's why it's called Imiter bis.

Dan Ferris:                 OK. And the other two that are on the current map that you guys just published in your presentation, Azegour looks like, what, copper-moly- and – W is tungsten, am I right?

Benoit La Salle:          Yes.

Dan Ferris:                 OK, I had to remember my symbols, there. And Amizmiz is a gold project. They look like they're a little north of Zgounder, near Marrakesh.

Benoit La Salle:          That's right, so those two, Amizmiz to start and Zgounder, we'll decide, but that's why we've created this spinout called Mx2. So we created a spinout, which we'll close any day, with the team from Red Back Mining, Rick Clark, and Adam Spencer, [inaudible], and they went from Red Back, they sold that to Kinross, as you know. Then they went and did a couple of other deals, including Montage in Ivory Coast. So the team came over to Morocco and they wanted to – I guess it's a great progression to go out of West Africa into Morocco where life is fantastic, infrastructure is great, mining code is friendly, people are there.

So Rick and the team moved out of Ivory Coast into Morocco, and we did a deal together, we created Mx2. It's well funded, it's got some very, very senior new shareholders coming in, and Amizmiz, and maybe as they go to be decided shortly, is going to be rolled into Mx2, and Rick and his team are going to see the developing. And why we did that, because those are not silver assets, so we did not want to pollute our message that we're developing a gold tungsten or a gold asset. We thought that was kind of a mixed signal, so we created Mx2, which will be pure gold with its own team. And Aya owns 42% of this new company, which will go public in a few months.

Dan Ferris:                 OK, all right, we'll look for that. Let's talk a little bit about, I want to talk a little bit more about Zgounder, because it is such a remarkable property. It says on your presentation, you have industry-low discovery costs. Are you telling me that you have the lowest discovery costs in the world, there, or among the lowest in the world?

Benoit La Salle:          As a company, our discovery cost, last year, it was 15 cents per ounce of silver. So, in 2023. 2024, we're finishing the resource update. But in 2023, our discovery cost was 15 cents per ounce of silver. So that is, yes, one of the lowest. I haven't seen any lower cost, but, you know, maybe it may exist, but I have not seen that, to discover ounces at a cost of 15 cents. Two reasons is, the discovery is at surface, it's there, and the cost of drilling in Morocco is one-third the cost of drilling anywhere else around the world. All in, including assays, in Morocco, you are at $145 a meter, all-in −

Dan Ferris:                 Why is that?

Benoit La Salle:          − including the cost of labor, the cost of the equipment, the cost of power.

So, you know, labor in Morocco is about one-tenth of North America, one-third of probably most of the world. To give you the example, we built the new plant at Zgounder with all its infrastructure, new tailings dam, new water reservoir, everything, a big camp, and we built that for $140 million. That same camp in Canada is between $450 million and $500 million, and I always joke, in British Columbia, it'd be $700 million.

Dan Ferris:                 Yeah, that's right. [Laughs]

Benoit La Salle:          So, when you look at what we can build in Morocco, craftmanship if phenomenal, the quality of construction is impeccable. Quality of the steel, which they have there, is impeccable. Power is at 7 cents per kilowatt hour. So, you have a workforce that is willing to work with you that is very inexpensive when you compare to North America or Europe, and craftmanship is better. So, the unemployment rate, which is, for them, they look at it being a negative thing, is 13% in Morocco, right now. But for us, as an employer, it says that we have a lot of people available coming in to work with us, and they're young and they're very well educated.

So, we don't have a shortage of people, the costs are low, or lower than the rest of the world, and they're very good. So, our drilling costs are $145 a meter, and the discovery rate is fantastic, because we've been drilling at the Zgounder structure and the Boumadine structure. So, our cost of discovery in 2023 was 15 cents. We're going to come up with our new resource update next week on Boumadine, and a little bit further on Zgounder. And, you know, last year, we spent $30 million, $35 million in exploration. So, you know, this – but a lot of it was infill drilling, so we won't have the same success rate, because we did a lot of infill drilling. That doesn't add, but it changes the category, but our cost of discovery is still extremely, extremely good.

Corey McLaughlin:    Just for listeners here, I know it's kind of intuitive, but the cost of exploration being so low, why is that so important and why is that an advantage for you guys?

Benoit La Salle:          Why the cost of exploration is important, if you're a normal junior, because you need to finance yourself. And the more you explore, the more money you need, the more shares you issue. And this is why, if Dan is looking at the presentation, we show ounces of silver per shares outstanding − because these are two metrics that you need to control. Sure, you can increase the number of ounces that you have, but if you explode the number of shares, you as an investor don't feel better. Me, as an investor and, you know, the board, we are big shareholders in Aya, we want the number of ounces to go up and the number of shares not to go up.

And that is, therefore, very important, that the cost of exploration is not so high. If you have Zgounder in Argentina or Chile, like Filo, which is a beautiful deposit and all that, their cost of drilling is $1,000 a meter. So, if you are spending $1,000 a meter up there, and you want to do like we do, 200,000 meters of drilling, that's a $200 million budget. And then, you need to raise money, then you need to issue shares, so, the cost of exploration is important. Now, in our case, we're cash-flow positive, so it's different. We take it out of, Zgounder pays for the exploration. So, we are very tight, we only have 131 million shares outstanding, and at the board with our people, we control 46% of it.

So, it's a very tight flow, it's very well held by shareholders that are close to the board, which is fantastic. And we don't need to raise money to do exploration. So that's why it's important. You're right, it's not a key factor, normally, because we present to mining shows, and people come up and say, "Oh, this year, you know, we'll have a big program, it'll be 6,000 meters." Well, we do 200,000 meters, so. [Laughter] But why do they do 6,000 meters?

Dan Ferris:                 Because that's what they what they can afford, yeah.

Benoit La Salle:          Because the cost of the drilling is so high, and then they have to spend $3 million, $4 million in exploration, and they go, "[Makes disgusted sound] Can't do that." Our exploration team is 85 people, we currently have 20 drills [inaudible]. So, we have two labs that work full time for us that are independent, but they work for us. So, you know, it's a logistic thing, so your cost is important.

Corey McLaughlin:    And just one other quick thing, are you using mostly or all-local labor?

Benoit La Salle:          One-percent expat; 99% local.

Dan Ferris:                 Wow.

Corey McLaughlin:    Wow. That's great.

Dan Ferris:                 That's very cool.

Benoit La Salle:          They are there, they're very good, they speak the language, you know, we work in Arab or in [inaudible], a little bit in French, that's it. So, they speak the language, they know the people, and they work hard and, yeah, and they understand who we are, they understand that we're a publicly traded company, we have programs for them to own shares. And we bring them into our world of a public company, but they do the work. And you know what, take a look at all the videos, take a look at the construction, it's one of the best that I have seen in my 30 years in mining.

Dan Ferris:                 Oh, wow.

Corey McLaughlin:    Nice.

Dan Ferris:                 It makes me wonder what other industries I should look at in Morocco. I mean, if the labor force is that great and they sound like a motivated group of people and the laws sound friendly toward mining. If they're friendly toward mining, that's the most, you know, hated industry around the world [laughs], so.

Benoit La Salle:          Well, the other industry in Morocco that's really doing extremely well is the EV industry. And I was giving a speech in Morocco, not long ago, and I said, you know, for you guys to have Mr. Trump come into power, who has decided to remove the IRA funding to all the EV sector, has been the best decision for Morocco. And everybody's moved out of North America into Morocco. They were there and now they're even bigger there. Why? Beause Morocco has a free-trade agreement with North America, it has a free-trade agreement with Europe, and with Asia.

So they're all there, CATL, BTR, BYD, they're all there, they're all building batteries there. And the plants are not, like, to be built; they're built. They're there, they're working. So the EV sector in Morocco, it's in Tangier, it's to the north, is amazing. So, what you see in China, the next place in the world that's got the same kind of pizazz and momentum in EV is Morocco.

Dan Ferris:                 Wow, did not know that. I want to get back to another question. Why is the power so cheap in Morocco? You said it's, like, 7 cents?

Benoit La Salle:          That's a great question, and the reason is because it's wind and solar. So, they were way ahead of the curve, 20 years ago. Twenty years ago, they decided to start building their solar and wind capacity. Now, you know, Morocco is the desert for more than half of its surface, and it's got the Atlantic. So, the Atlantic brings the wind, and you go on the plateaus and you put the solar panel there. And so, currently, the grid is 33% green. Our mine, Zgounder, is 100% green. So every unit of energy that comes into the plant or to the camp is green, it's from solar and wind.

And their goal is to be 50%, in five years, I think, for the grid to be wind and solar. And the rest is gas − a little bit oil and a small amount of hydro, but not much. But it's really green. Now, you know, there's a massive gas discovery off Mauritania and Senegal, and now they are saying they're going to be building a pipeline that's going to replace the Russian gas to Europe, coming through Senegal into Morocco, across to Spain, most likely. And so that's going to bring, for them, a major supply of gas, and that is a key, a priority for the country.

But they're green. Total Energy is building a $14 billion project, green energy, in Morocco. So we have signed a 20-year power-purchase agreement, with an independent power producer, which is hooked on to the grid. So we get our power from the grid, but there's a matching system where you match your use and source of power. So, we are matched with an IPP, an independent power producer, and we have a power-purchase agreement with that group at 7 cents for 20 years.

Dan Ferris:                 Wow, that is very interesting to me. Most places that ramped up their wind and solar, the price went up, it got more expensive, [laughs] it didn't get less expensive, so.

Benoit La Salle:          Yeah, but then, because they were doing small projects. If you do a small project and you put a few solar panels and all the equipment and all that, you cannot bring the price down. But what they do there are solar farms, and currently, worldwide, the cheapest, cheapest, source of power is solar. So that's why it's growing so quickly in the States and in China, you can produce solar energy, now, for 4 cents or 5 cents, and I don't have the latest, but 4 cents or 5 cents per kilowatt hour. So, it's the cheapest source, right now, except for nuclear, but that's a different ballgame and that's another animal.

But nuclear is also staying very alive, because it's going to be one of the cheapest. So, but that's why Morocco were at the forefront of the thinking on green energy.

Dan Ferris:                 Wow, all right, I have more questions about that, but [crosstalk].

Corey McLaughlin:    I'm convinced. I'm going to Morocco. [Laughs]

Benoit La Salle:          [Crosstalk] we have tours. I'm telling you, best food, great people, surfing 12 months of the year in Agadir, skiing in the Atlas Mountains, the best food you can find, the fish and the local cuisine is amazing, music's great, if you love music. And the city right now in the world that I think is kind of the place to be if you want to have a good time, is Marrakesh. And Marrakesh is very young, very trendy, and at the foot of the mountain, we have our technical office there. You're at the foot of the Atlas Mountains, and from Marrakesh, you go up into the Atlas, and that's where all the mining sector is.

Corey McLaughlin:    Yeah, Dan may have another question here, but, yeah − I was just curious, how does somebody from, you're Canadian, end up in West Africa? I know you've been there for a long time, but how did you end up there to begin with?

Benoit La Salle:          Yeah, you know what, you're going to have a good laugh. I'm an accountant, I'm a tax specialist, OK? I'm not a geologist, I'm not a mining engineer. But I have the understanding of taxation, international taxation. And I was doing a lot of radio shows and television shows in Canada, and one of the largest Canadian charities asked me to join their board. And I became a board member and president of the audit committee, or chairman of the audit committee, and they were spending money in Africa.

So I went to Africa with them, as a board member. And at the last meeting with the president of Burkina Faso, Mr. Blaise Compaoré, says, "Monsignor La Salle, you are from Canada, you must know mining." And I'm a tax specialist. [Laughter] So, I said, "Yes, Mr. President." He said, "I'd like you to tell me why we don't have mines in Burkina. There are mines in Ghana, which comes right into Burkina. There are mines in Ivory Coast. There's mines in Mali. There's mines even in Niger, where you have uranium mines."

"Why was God so unfair that, in Burkina, which is a big piece of land, we have no mines?" I said, "Mr. President, I'm really not from the mining space." He says, "Yeah, yes, but you Canadians know mining so well, I count on you to tell me why we have no mines or tell me how we can find mines." So, I came back to Canada and I created Semafo. Semafo means "West Africa Mining Corporation, Societe d'Exploration Miniere d'Afrique de l'Ouest." So I created Semafo with one geologist, raised a little bit of money between friends, they all thought I was crazy, obviously.

And one day, at PDAC, which is happening in two weeks, somebody came in to the booth and he said, "I think I have your solution and it's called geophysics." And all my geos started laughing and thought this guy was a clown. I said, "Explain it to me, explain that to me," and he says, "Geophysics, we're going to fly an airplane and we're going to read and try to understand where the structures are. And if we can find where the structures are, you know, we will see."

And people [do not understand] that, in Burkina, it's the end or the entrance of the Sahara Desert, and the ground was covered by 20 to 30 meters of sand that had been compressed, that killed all the [inaudible]. And we did the geophysics and Semafo discovered the Hounde Belt, which today has, like, ten mines. And so, Semafo went from a penny stock or nothing to $3 billion market cap over time, and so that's how I ended up in mining in West Africa − on a pro bono trip to Africa to help children and mothers. And we created Semafo, and then Semafo was sold to Endeavor, and then we stumbled on Aya, which we put the same team, Semafo 2.0.

And the team is so competent that they discovered Zgounder and Boumadine and we've built this third project. So, this is how we went there.

Corey McLaughlin:    Wow, it's a great story. Amazing journey, too. I'm sure you're happy you said yes to Mr. President all the way back then, right?

Benoit La Salle:          [Laughs] But you know what, funny enough, we just moved offices within the office, and I was putting my stuff out yesterday and actually came up with the picture of that day. So I just put it up, it's right in front of me, the picture of that day when we're all together and he goes over to me and he says, "I'm counting on you to give me the answer." So, I still have that, which was 1994.

Corey McLaughlin:    Wow.

Dan Ferris:                 That is funny. That's great. [Laughs] An unlikely story. It's unlikely that a Canadian was not, you know, a miner over in Africa. And then, to come back and start one and have it be a big success, and now you're on to your second big success. Which Aya has already had a fantastic run. I think when I first talked to you at Rick Rule's conference in Florida, I think I had noticed that the stock was, like, 80 cents at one point, and it was, like, $14 at that point. [Laughs] So, it had already had a monster run.

But I remember asking you, you know, the typical question that any investor would ask, which is, you know, "Aren't I too late?" Right? The stock has already just taken off like a rocket ship and everybody knows the story. And I was shocked, like, it's very hard for anybody to make a compelling case to me about anything… but I came away from there believing that you were right, that the upside was tremendous. And I wonder if you could tell me that kind of story and that reason why you think the upside in Aya is still so great, even after the stock has already had a monster run.

Benoit La Salle:          Well, we had a monster run, you're absolutely right, and we went to $19.56, and then some people started saying, "OK, this is, like, wow, this is way too big, maybe a little bit too fast." But really, what stopped the run is when Mr. Trump came into power that morning and he said, "You know, I really believe in bitcoin and crypto and all that." We saw a shift out of the precious metals sector. Some of our shareholders said, "Look, we're selling our position to go into crypto or bitcoin, and we'll come back later when the momentum is back."

So, when we moved from 80 cents to $12 to $13, that was fundamental. We were finding ounces. When we took the company, we had 10 million ounces of silver, and before the new resource update, we 450 million ounces of silver. So, we took it from 10 to 450, so that was fundamental, and then there was momentum. You know, if you recall, last September, October, November, it was a momentum trade, the stocks were going up, it was a momentum trade, people wanted to be in silver. Mr. Trump comes in, you know, he just sets the record straight, and then you saw what happened to bitcoin, it went from $60,000 to $100,000, and there was a big move.

We adjusted back down to 12, 11 to 12. We also had a difficult [third quarter] last year, because of the ramp-up of the underground mining, which we've corrected, and so we took a beating back to 11. And today we're between 11 and 12. But where do you see, in mining, that we're going to be adding, you know, and I'm giving you a round number, 100,000 ounces of silver every year of new discoveries that we're adding to a producing mine, and a to-be-producing mine, in one of the best jurisdictions. So, what we need to see now − and so we will be continuing to give very good result.

We gave some two weeks ago on our production for January. January was equivalent to a quarter, so the amount that we were producing per quarter we produced in January. And January was the beginning of the ramp-up of our new mine, our new plant, at Zgounder. So, the ramp-up is continuing very, very well, it's going to grow, and we should be exiting the year with a quarterly production of 1.5, 1.6 million ounces per quarter, at an all-in cost of $14. So it's very, very good.

But the real upside comes from the exploration upside. So, at Zgounder, we have 400 square kilometers and we are only mining from one structure, which is 2% of the area that we have. And at Boumadine, we have 800 square kilometers that we've added this year, and all we've drilled is one structure. And on that one structure, as of now, we're at 352 million ounces of silver and next week, we'll be a lot higher. So the reason why Aya was such a great trade, and is continuing to be a great trade, is because we're finding ounces in the ground, at 15, 20, maybe 25 cents this year, but we're adding ounces that have margins of $18.

So if you have a margin of $18 and your cost of discovery, make it even 50 cents, your value goes up. So, that's why the value of Aya will keep going up, it's because we keep adding ounces that have beautiful margins at a very low cost of discovery.

Dan Ferris:                 Right, and you are the only Toronto-listed pure place silver producer, and what you just explained to me about the momentum kind of, you know, deflating out of the trade there, it explains why you have your price-to-net asset value on your presentation. I encourage everybody to look at the presentation; it's very good, it's very thorough. And you're just about the cheapest one, almost, and it makes sense, doesn't it? Because silver is kind of, you know, it's more volatile than gold, we all know this. So, it's kind of this moment sort of playing right into a decent value-oriented mining investor for Aya.

It feels like an interesting moment; it makes me want to look at the stock. I've stayed away from mining in my newsletter called Extreme Value, except for very, very, very few. We have Altius Minerals and we recommended Royal Gold at one point, and Sprott Inc is related to mining, but not a mining company. And that's it, you know, because I'm terrified of mining. But this is interesting to me, it's interesting.

Benoit La Salle:          Yeah, and momentum will come back, it will come back, and once it comes back, we are the tier-one quality that people look for. Beause most people say, "OK, I don't want to take a jurisdiction risk, and if silver is going to go to $50, the bad jurisdictions are going to get worse, that's for sure." So, you don't want to take a jurisdiction risk; you want good-quality assets and you want management that has done it, that has got a track record. And that's what we bring to the table. The management, as you said, this is our second big success, and some of us, it's their third, because some were [working] before in other companies.

And I think currency and mining, it is the best jurisdiction, the No. 1 jurisdiction, and the assets are great. So when the momentum comes back and you are big pension fund out of London or out of New York or – and you say, "OK, I want exposure to silver, but I don't want to go to – " and again, without giving any names, "to some South American countries that are really getting to be very, very difficult." They say, "I don't want that." So they come and they say, "OK, well, this is great exposure," silver, better than buying the commodity.

Because if silver goes to $50, if you bought the commodity at $30, you know, you had a 40% run or a 50% run. But if silver goes to $50 and you're a shareholder in Aya, your run's going to be triple digits, so it's going to be very different.

Dan Ferris:                 So we've talked about the major sources of risk in mining, right? We've talked about jurisdiction, we've talked about the people, right? Rick Rule would call you guys serially successful, because you had Semafo, now you're on to this, and you've had success already with this, so that's – and the assets are great. The quality of the terrain, the deposits, is great. The balance sheet, let's talk about the balance sheet.

Currently, you have listed, and this is just [from] your latest presentation, if you have more up to date, that's fine – looks like $100 million in debt, $73 million in cash, and a recent market cap of about $1.5 billion Canadian. And those other figures were U.S., but, you know, people can do some math on this. With did you say 100 – it says here 141.9 million shares fully diluted. I mean, $73 million in cash, $100 million in debt, and you're producing really excellent grades and excellent assets, this is really decent, you know?

Benoit La Salle:          Yes, and Dan, the debt is a debt on the project, which was for the plant that we just built, and it's with a development bank. So, you know, there's some banks that lend you money, but it's called "loan to own." They hope that you default so they can buy it. This is not the case. This is a development bank, the loan was made for the development of the area, of the zone where we operate, for the creation of local jobs, for our ESG approach, our corporate social-responsibility approach. So it's a very soft loan, very, very soft.

And it's the only debt we have in the company; we don't have anything else. We have no hedging, no streaming, we sell at spot every day. We've been selling, now for the past month, at 32, 32.5, silver, because we have no hedging, and we have no debt. We have a lot of debt capacity, but we're not using it. We run a very tight ship. Our GNA, last year, was $5 million U.S. for the year, total GNA. We run a very, very tight ship, and our cash flow, last year, from Zgounder was probably $20 million, we reinvested [$30/$35 million] in exploration, we paid the GNA, so we're running a very tight ship.

We have no capital repayment to the debt in 2025; we start repaying in 2026, which is very flexible. So, there's no pressure on the balance sheet, there's no pressure to do anything. We're very, very well structured, and that's who we are. It's always been managed like that. And you're right, there's 131 million shares, and there's 11 million shares which are the option to the management team. When we came in and we took over, this company was broken, and I told the board, at the time, like, "We're going to work for nothing in year one, we're going to try to put back the pieces together, put the puzzle back together, but we'd like to have options."

And they gave us an option package, which I divided between every senior employee. So if you look at that list, there's no warrant, there's no financial instrument outstanding, only options to management, and those options get vested over three years, and I have never exercised it. Mustapha, my No. 2, has never exercised it. The younger guys have exercised it a little bit, but very often to pay down their mortgage, but that's it. It's very well run and I do not plan to exercise any until we get taken out in a few years at full value.

Dan Ferris:                 You said no streams or royalties? So all the revenue is to Aya.

Benoit La Salle:          Yeah. At spot.

Dan Ferris:                 No participation by the government or anything like that, either.

Benoit La Salle:          No, the government, we have a 3% royalty that we pay to them as a tax. So, that's with the government, there's 3% with the government, which is very reasonable.

Dan Ferris:                 Right, yeah, I'm surprised it's not, like, 30%, right.

Corey McLaughlin:    It's lower than my tax rate [crosstalk]. [Laughter]

Benoit La Salle:          Yes.

Dan Ferris:                 This is a hell of a story you got here, Benoit. This is, you know, it really is.

Benoit La Salle:          It is.

Dan Ferris:                 So, we've come to the point where I like to ask my final question, which is the same question for every guest. Even if it's a nonfinancial topic, which we do sometimes, I always ask the same final question. So, for our listeners, if you could just leave them with a single thought today, a single takeaway, what do you think it would be? And you can take your time answering. If you've already said the answer, feel free to repeat it. What's the one thing you'd like our listeners to take away from this today?

Benoit La Salle:          Well, it's not specific to mining − it's more, I find that people don't have a macro view of the world and they tend not to understand what's happening. And to me, what really drives my motivation and why I like the industry we're in and why I like the sector we're in, is I think we're reshuffling the planet, right now. It's happening. You know, we have talks in Ukraine and the president of Ukraine is not there, because it's not relevant, he doesn't have to be there. The world's being divided by power; he's not a superpower, so he doesn't need to be there.

And at the end, the only thing that will have value will be gold and silver. Because everything else is bill printed, you know. The weaker countries like England and Canada, we sold our gold. France kept its gold and they have some, but who's buying gold? Turkey, a powerhouse. Poland, doing very well. India, obviously, strong demographics. China, Russia, they're buying gold. And why are they buying gold? Because at the end, that's going to be the only store of value. They will take the gold, give it a value, divide the debt into the gold and say, "Our balance sheet is fixed."

And it is now the time to fix the balance sheet. Elon Musk is fixing the balance sheet. That's what he's doing, he's trying to cut down the expenses, reduce the debt, stop printing the money. But gold and silver are going to be part of that, and that's why I think it's coming. People have to understand this. When you speak to Rick Rule, who is a great friend and a guy I trust, and you speak to Eric Sprott, and you speak to all these guys, their targets on silver is off the chart. And the reason is, it's not because they're dreamers; it's because we are at a point where we need to fix things and it has to get done now. And it will happen.

So, in my 30 years, every time Goldman Sachs said something, it's because they had prepared the ground for it. When they tell you gold's going to $3,100, it's because they know it's going there. I mean, I've never seen them go wrong on a prediction; they normally prepare the ground. And at $3,100, the momentum's going to kick in for gold, for silver, momentum's coming back into the space, and people need to be part of that, if they want to have good return in their portfolios. And I think that's why I find this so fascinating, what we're doing right now, because we're part of this global reshuffling of the world.

And it's very interesting. Look, they've reshuffled Africa. Africa is like a chessboard. You take every country, it belongs to either Russia, China, or United States, that's it, nobody's independent anymore. And they're all taktaktak, it's divided, it's done. And that's why Mr. Trump says, "Hey, I'm going to take Canada, Panama, and Greenland." OK, these are fair asks. And Russia says, "OK, well, I'll take Ukraine and I'll give you two, three more names." And China will do the same.

And, I'm very serious [laughs], at the end, gold and silver will drive the show, because that's what will be the real value. And we're seeing it in Africa and we're seeing it, it's happening, and us, North American, are not welcome, anymore, in Burkina, in Niger, in Mali, in Chad, soon in – well, Burkina, obviously not, but soon in Togo, Benin – why? Because it's now Russia. And so, us, we can't operate there. The Russians operate extremely well. Algeria, now Russia. Can't operate there for us − impossible.

You can operate in Egypt, you can operate – if you want to operate in Sudan, Eritrea, and all that, that's China. So, the world's being divided and that's what it is.

Dan Ferris:                 All right, that's a great answer. You know, just take a look at what's going on in the world, you'd own a lot more gold and silver, if you really understood it.

Benoit La Salle:          Yes, that's my point.

Dan Ferris:                 Yeah, so Benoit, thanks so much for being here. It was great to talk with you again. Are you going to be at Rick Rule's conference in July? .

Benoit La Salle:          Of course. Absolutely. Always.

Dan Ferris:                 All right, I'll see you there, then.

Benoit La Salle:          Thank you so much for the time, and I'm glad that we were able to take the time this morning. It's always a pleasure.

Dan Ferris:                 Yes, thank you very much.

Benoit La Salle:          Thank you. Thank you, guys.

[Music playing]

Dan Ferris:                 Throughout history, gold has been the most secure, least volatile, most international, and least political form of money. And when market uncertainty is high, many investors look for safe-haven outlets, including billionaire investors like hedge-fund founder Ray Dalio and John Paulson, who have recently loaded up on gold. After climbing past $2,700 an ounce, we could see gold reach as high as $3,000 an ounce by the end of 2025. Or higher.

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[Music playing]

All right, that was a bit of a long final thought, but it was a good one, right?

Corey McLaughlin:    Yeah. I don't think we've heard that, yeah.

Dan Ferris:                 "Figure out what's going on in the world, you'd own a lot more gold and silver." And I've seen people, like, we've talked with Bob Elliott on the show, a couple of times, former Bridgewater guy, and he has said the same thing. I've seen him on Twitter within the last day or two, literally, saying, you know, "You probably don't own nearly enough gold. You should think about buying a lot more, right now." So, yeah, great message and very interesting situation.

I'm willing to bet 90% of the people within the sound of my voice are going, "Morocco? Really?" You know, it's just, it's a very interesting situation, isn't it?

Corey McLaughlin:    Yes, yeah, I was probably one of them. When I saw we were having him on the show, I said, "Morocco?" "Casablanca?" is the other reference other people might go to first. You know, it's a great story, I mean, he's got a great story going on there, it seems like. I mean, it sounds like you'll look into it some more, into the company itself. But, I mean, the story's fascinating, just from a history point of view, that the minerals have been there, just kind of not ignored but not available for I think 100 years, until recently, to foreign investment. Or foreign exploration.

So, yeah, I mean, they're very early in the whole thing and it seems like he knows what he's doing, obviously. And it's a convincing story, for sure.

Dan Ferris:                 Yep, very compelling. You know, the idea that there's some place on planet Earth where you're walking along seeing really rich outcropping mineralization that nobody's touched, it's like virgin territory – almost virgin territory, we should say. And in a friendly jurisdiction, now, where, you know, your maximum tax is 3% royalty to the government. I mean, that's incredible in the mining world, it really is. So, and, you know, he talked about other jurisdictions in South America not being as wonderful as they were, so, you know, this is a new one popping up. It's pretty great. It's pretty impressive.

Now, you know, you have all the same risks in mining, I mean, it's a horrible industry, it's highly risky. I mentioned, you know, the very few mining-oriented stocks that we put in Extreme Value, all of which have been there for a while now, so that's why I'm willing to talk about them. Our subscribers have done really well with them already. But, you know, I mean, I don't see myself actually putting a silver producer in there, a dedicated silver producer, but just the fact that it appears like it's certainly relatively cheap to other silver producers. And it's the only pure play one on the TSX.

I mean, it's just pretty darn – and the balance sheet looks decent. It's just pretty darn interesting, I think. This is like, you can count the times on one hand when we've brought somebody on the show and talked about a mining company that seemed compelling, so, this is one of' them.

Corey McLaughlin:    Yeah, it was interesting to hear, you know, coming off our conversation with compounding quality, in Pieter Slager's, about the incentives here, as well. You know, the whole leadership team there has options that they seem committed to. So, it's another thing to keep in mind. And, yeah, and just going back to what you started with, with his final answer there, I certainly haven't heard anybody from Morocco or Africa explain that in the way that he just did. So, as far as dividing up the country like that amongst U.S., Russia, and China… I mean, it makes sense, right? We all need these resources and it's happening right now, so.

Dan Ferris:                 Yeah, really cool. Yeah, it is happening. It's pretty cool. So, I mean, I love talking with Benoit, too, because he's a good talker, he's like a one-man Morocco advocate, a Moroccan mining advocate, I guess you could say. [Laughs] And it's just exciting to hear a guy talk about something that sounds fresh and new and different and compelling. Really enjoyed that. I'm so glad we finally got him on the show.

So that's another interview and that's another episode of the Stansberry Investor Hour. I hope you enjoyed it as much as we did.

We do provide a transcript for every episode. Just go to www.investorhour.com, click on the episode you want, scroll all the way down, click on the word "Transcript" and enjoy. If you liked this episode and know anybody else who might like it, tell them to check it out on their podcast app or at investorhour.com, please. And also, do me a favor, subscribe to the show on iTunes, Google Play, or wherever you listen to podcasts. And while you're there, help us grow with a rate and a review.

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For my co-host, Corey McLaughlin, until next week, I'm Dan Ferris. Thanks for listening.

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