All posts by Jon Hopkins

Clarity Gold: Unearthing big value in overlooked projects

Founded in 2019 and publicly listed on the CSE in July 2020, Clarity Gold (CSE:CLAR) has the objective to acquire and develop gold projects that have been “overlooked or underfinanced.”

Headed by Chief Executive Officer James Rogers, Clarity’s management team has certainly proven its ability to identify, evaluate and execute transactions, having collectively completed over 100 resource project deals.

In November 2020, the company acquired an option on 100% of the Destiny Project, a gold project located in the prolific Abitibi Greenstone Belt, which extends from Wawa, Ontario to  Val-d’Or, Quebec.

In addition to Destiny, Clarity has three 100% owned projects on its books in British Columbia: Empirical, a gold, copper and molybdenum project located 12 kilometres south of Lillooet; Tyber, a gold, copper and silver project located 18 kilometres south of Parksville; and Gretna Green, a gold, copper and silver project located 24 kilometres southwest of Port Alberni.

Rogers spoke recently with Public Entrepreneur about his views on building a company in the resource sector and what the future holds for his industry and Clarity shareholders.

Let’s start by delving into Clarity Gold’s mission statement and your guiding principles. 

Clarity’s objective since inception has been pretty clear – we’ve been entirely focused on gold in North America, with an emphasis on Canada. Our mandate has been to become an explorer concentrated on discovering and building ounces in stable jurisdictions within North America. 

British Columbia was our starting point, and we’ve grown by establishing a strong foothold in Quebec with the Destiny Project. 

Destiny is a project you acquired in November and it is in the famous Abitibi Greenstone Belt. Tell us about your decision to obtain a 100% option on this project.

Destiny is an exciting gold project on a lesser-known structure in the belt. The Abitibi is an important jurisdiction in Canada, and in the world, really. It is one of the most prolific greenstone belts there is.

The Abitibi is comprised of six dominant structures. The 400-kilometre-long structure that the Destiny Project is located along is called the Chicobi. It is a less-explored structure that is proving to have gold mineralization associated with it, just like on the Cadillac and other well-known structures through the Abitibi. This is one of the reasons we were attracted to it. Dominant structures play an important part in controlling gold mineralization within the Abitibi.

When we look at the main structures in the south, they are largely near surface. Nobody really found the Destiny Project until 1998 because it has a thin veneer of overburden and till – it is just not on surface.

It started in 1998, which kicked off multiple campaigns totalling over 50,000 metres of drilling, culminating in a historic resource in 2011. And it has basically lain dormant since 2012. Our mandate is to take a fresh look at this, peeling back the previous data and thinking more about this project’s optionality as a high-grade, structurally controlled gold deposit. 

You also have three projects in British Columbia. How do these fit into your near-term plan?

We started with Empirical, which was our flagship project in British Columbia. We then acquired two more grassroots projects in the province. My background is in project generation and one of my strengths is keeping an eye open for new opportunities and projects. When our team saw Destiny, we recognized the opportunity for a more advanced project to create value in a jurisdiction that we’re comfortable working in and understand really well. We see the best opportunity to create near-term value for the company in advancing Destiny, but will continue to maintain and advance the rest of our portfolio.

How are you funded to move forward with the planned work following your recent private placement? 

We just finished a $4.5 million financing. The next step for us is two-fold. We are financed to carry out exploration to advance Destiny but are also on the lookout for more projects with a similar profile where we could add value with our expertise. Destiny is a foothold – it is really our first step into a large gold camp where we have experience operating. 

You have somewhat of a different background than the typical junior company CEO in that you run a large services company for the industry as well. What do you consider is your main strength as head of Clarity Gold? 

I’d say looking at data and coming up with an idea. A cool stat is during the hunt for Destiny, I compiled 200,000 drill holes in Quebec and Ontario inside of the Abitibi and started thinking a bit about why the Chicobi structure just hadn’t been looked at the same as the others and why this is an important and underexplored part of the Abitibi story. 

Bear in mind, the Abitibi has produced more than 180 million ounces of gold, which is an incredible number. It’s actually hard to keep track of the number of headframes you pass as you drive from Val-d’Or to Timmins. One of my strengths is definitely looking at data but also in executing. 

I come from an exploration background, running a services company where our specialty is grassroots exploration and running drill programs, up to say 70,000 to 100,000 metres of drilling in a year. But when we get in and take a look at data, and we’re able to manipulate and think about things differently, that’s where we find things that get exciting. Where things have been overlooked or interpreted in a different way. Then we’re able to bring a fresh perspective to something and bring it to life. 

Let’s finish up with a look at what investors should expect from Clarity in 2021.

This year is going to be big. It will include our maiden drill program on Destiny, which should be kicking off before winter’s end. We’ll start with about a 10,000-metre program, which will then carry on into subsequent drilling as we get results and continue to move it forward.

This story was featured in the Public Entrepreneur magazine.

Learn more about Clarity Gold
at https://claritygoldcorp.com/

Taat Lifestyle & Wellness: Helping smokers kick the habit by embracing the cigarette experience

The world of smoking has undergone quite a transformation over the past couple of decades, with cigarettes, cigars and pipes giving partial way to vaping and other next-generation products that more closely align with positive health and lifestyle values.

Few people are positioned better than Setti Coscarella to understand this change and assess whether it is here to stay. So firm is his belief in the segment’s potential that he left cigarette industry titan Philip Morris International (PMI) earlier this year to join young start-up Taat Lifestyle & Wellness (CSE:TAAT) as Chief Executive Officer.

Coscarella was a top strategist for reduced-risk products (RRPs) at the tobacco giant, where his insight led to initiatives that collectively yielded a fivefold increase in RRP leads and purchases.

Taat is focused on hemp-based products, so it should come as no surprise that the group’s Beyond Tobacco cigarettes feature CBD and CBG, both of which are known to provide a wide range of health benefits. The cigarettes contain no tobacco or nicotine, making them ideal as a tobacco replacement or cessation tool.

Public Entrepreneur caught up with Taat’s new boss a few months into the job to find out more. The first question was obvious.

You have just moved from the world’s biggest tobacco company to a start-up. Was this a big leap of faith or a no-brainer?

In a lot of ways, this might be considered a leap of faith, as there were the combined risks of giving up the stability and prestige of working at PMI and replacing that role with a position at a brand new company. 

If one’s modus operandi is to just collect a salary and grow within the parameters of a corporate environment, then a move like this would definitely be a leap of faith. I don’t feel that way about it, though, and there are two reasons.

The first is that I see greater potential in Taat as an alternative to traditional cigarettes than I do in any of the alternatives brought to market by Big Tobacco. PMI has spent US$7.2 billion producing smoke-free products, but how much market share has that earned them? It’s then arguably a leap of faith to stay on the Big Tobacco side, since it assumes their alternatives will become and remain profitable.

That brings us to the second reason, which is that a leap of faith is very different from a calculated risk. As an entrepreneur and investment banker by trade, calculated risks are something I’m very familiar with. When you take smaller risks, you position yourself for smaller rewards, and while there’s nothing wrong with that, I’ve become very comfortable taking educated and balanced risks when making business decisions.

What is the advantage of Taat’s Beyond Tobacco cigarettes over other non-nicotine products? 

I love this question because it highlights an interesting discrepancy in the category of alternative products to tobacco cigarettes. Tobacco-free products such as gums, patches, lozenges and vapes all have two things in common. The first is that they generally contain nicotine, and the second is that they’re in a completely different format to what a tobacco smoker is conditioned to using.

I think most people can understand it doesn’t make sense to try to leave nicotine behind by continuing nicotine intake using a different method. As for the format, it matters far more than you think. If nicotine was the only thing smokers craved, then things like gums and patches would work much better. The fact that smokers frequently abandon these alternatives to return to tobacco cigarettes suggests they crave the sensory and motor elements of smoking, which none of those alternatives can provide. 

Taat is built around an objective of mimicking those elements: the stick format, tobacco-like smell and taste, the crackling sound from combustion and the ability to flick ashes off the stick as the product burns. You can’t do that with a vape device, and you certainly can’t do that with gum or a patch.

Part of that is the patent-pending refinement technique we use for the Beyond Tobacco base material, which creates a taste and smell resembling tobacco. While others sell difference, we sell similarity, and for a transition such as giving up tobacco, similarity is priceless.

You are targeting the launch of Beyond Tobacco cigarettes in the fourth quarter of 2020. How wide will the launch be? 

We’ll be launching in the state of Ohio, which puts us into a market of about 11.7 million people, with 22.5% of Ohio adults being cigarette smokers, based on 2016 data.

We are not concentrating on any particular part of Ohio. The big three cities of Cincinnati, Columbus and Cleveland are spread out geographically, which will allow us to examine regional trends during the launch, to better shape our expansion strategies. Our near-term intent is to expand our footprint outward to other states and organically build traction that way.

Does the company have international ambitions? 

Most definitely. And this isn’t just because other countries represent more smokers who might be interested in switching to Taat. It’s also because there are unique opportunities in international markets. For example, not many people know how expensive cigarettes are in Australia. Try nearly $50 per pack.

We also mentioned in October how the recent US$5 million private placement led by a prominent Hong Kong financier could help to expedite our entry into Asian markets.

But our current focus is on maximizing our launch in Ohio, as I believe that will build far more sustainable momentum than moving to expand internationally right away.

Can you give us an idea of the size of the market the company is aiming at?

Globally, about 1.3 billion people use tobacco, according to the World Health Organization. In 2018, the tobacco market at a worldwide level was valued at approximately US$814 billion.

Naturally, not every tobacco user necessarily wants to switch to a nicotine-free and tobacco-free product such as Taat, but there are enough tobacco smokers who have had enough of nicotine and want or have attempted to quit. One figure I believe reflects this in the United States is 2018 data from the CDC (Centers for Disease Control and Prevention) that says 55.1% of adult smokers had attempted to quit in the past year, though only 7.5% succeeded.

Therefore, if I had to answer this question in one sentence: hundreds of millions of people, and hundreds of billions of dollars. 

What can investors expect from Taat in the future?

Putting myself in the investor’s shoes for a moment, a start-up in the tobacco industry offering an analogue product such as Taat should present a clearly defined plan for commercializing it in a way that makes it a credible competitor to incumbent tobacco products. Further, I would expect visibility into how Taat is made and what the supply chain is like. Finally, I would expect transparency regarding the company’s progress, whether good or bad, both during the launch phase as well as during any expansion.

This story was featured in the Public Entrepreneur magazine.

Learn more about Taat Lifestyle & Wellness Ltd.
at https://trytaat.com/