VG Gold Corp and Rob McEwen have interested the press with their recent investment deal, but when you take a moment to look at the history behind the transaction, it’s enough to enthuse any industry insider.

The promising Paymaster property has gotten quite a bit of press in recent months, throughout both industry and non-industry sources alike, thanks to a $3 million investment by Rob McEwen. The company behind this exciting development is none other than VG Gold Corp, led by President and CEO Tom Meredith. We had the chance to sit down with Tom recently and get his thoughts on this exciting time for the company.

Initially formed in 1972, VG Gold Corp is an Ontario-based company that has been rather active in the Timmins gold district for nearly the past thirty years. Their exploration manager and team of highly experienced geologists have helped to locate and develop many of their biggest holdings including their Paymaster, Fuller, Davidson Tisdale, and Buffalo Ankerite properties. With the mining infrastructure already in place surrounding these properties, VG Gold has the people and resources necessary for large-scale production at any point in time. Collectively, they have produced five million ounces of gold, but the idea of stopping at this point certainly isn’t a popular one. With exploration, mine planning, permitting, and economic studies in place for a number of different properties, some are beginning to take note of the raw potential standing behind this company.

Building Excitement and Capital

“A year ago, we optioned a neighboring property from Goldcorp, and as we were going through the data on some of the parts of the property that we didn’t know, we found . . . what appeared to be a forgotten gem, and so we took a closer look at it. It’s something that has very exciting exploration potential, and so we just really put the data together on it fairly recently and then we made a presentation to McEwen Capital. They saw what we had and with this new property we optioned from Goldcorp and were very interested,” said Meredith.

That neighboring property was, of course, Paymaster. Once overlooked by owner Goldcorp as a result of their extensive property selections in the Timmins area and focus on their core mining operations. VG Gold and Meredith saw the real possibilities as they built an agreement to explore many of the properties Goldcorp simply couldn’t focus on.

At one time, Paymaster had some mining done on the first 500 feet of the west porphyry, and that data alone is enough to convince the company that this was just the tip of the iceberg. The little mining that was done in the area was halted in 1928, but just before it closed, the company in charge had completed some preliminary tests and found surprising results. The same grades and widths were present much deeper. It’s been confirmed present at 2,500 feet, and there’s little reason to believe, thanks to today’s technology, that it doesn’t reach 7,000 feet and deeper.

With a recent start in drilling and results expected by the end of September, much attention is being focused on this new development.

More than One Likely Success

Perhaps the most brilliant part of this equation, though, is that Paymaster isn’t the only potential success here. Timmins has two major deposits. One of those is Hollinger Mine and the other is Dome Mine. Because both are associated with extensive porphyry intrusions into mafic volcanic rocks, the geology behind the economic investment in the area is strong. Gold Corp currently owns the Hollinger portion, an area that has produced 31 million ounces of gold alone. The newer Paymaster lies in the southern portion of the same area next to the Dome Mine. With three very developed and stable gold deposits already at VG Gold’s disposal, there are some very real possibilities.

“There’s very good potential for the share price to appreciate from where it is now and with future exploration success, which we anticipate based on what we know about our new project. There’s plenty of opportunity to significantly increase value going forward,” said Meredith.

Mr. McEwen’s recent investment seems to indicate that as well. An often undervalued company, VG Gold Corp has quite a bit on its side. The success of the Timmins area is just one. It’s been suggested this area produces as much gold as anywhere else in the world. Pair that with the fact that it is in an area that is politically stable, which isn’t often true of gold and other mineral deposits, and VG Gold Corp may have a real winner. When you add the strength of experienced management, you have what might be a renaissance in the area.

The Team behind the News

Meredith grew up in a family with a large brokerage firm that specialized in mining finance. Under his uncle’s wing, he quickly learned the ins and outs of mining exploration finance. When the business was purchased by one of the biggest names in Canadian banking, he began to fly solo, an experience that has left him on the financial side of mining for nearly twenty-five years.

Exploration Manager Ken Guy, who has been associated with big names like Getty Resources and BP Selco, has been on the team for five years. With a strong twenty-five year history in the region, he’s well aware of the impending achievements in the area.

Operations Manager Gerry McDonald, formerly of Noranda, has been the force behind the construction and operation of a number of mines throughout the country. COO and board member John Tait, once the president of Southern Star Resources, also plays a role in the company. Declan Costelloe, also a US Gold board member, and Robin Dunbar, the president of Mustang Minerals, round out the deeply-experienced board.

Poised to take success by the reins, even Meredith can’t hide his excitement when he talks about the four reasons most people choose to invest in VG Gold Corp.

“Number one, it is in Timmins, which is a proven gold mining camp that’s produced as much gold as anywhere in the western hemisphere. The Carlin trend in Nevada has produced about the same amount as Timmins, so it’s a world class gold camp. Number two . . . it’s in a politically safe jurisdiction here in Canada. So, those things are . . . very important. And then another reason would be that we have a very strong management team, working with the McEwen group, with a track record of success. And finally, we . . . already have three developed gold deposits with resources in place that underpin the company’s value, and now we have this very exciting exploration opportunity that could significantly increase the company’s value,” said Meredith.

Shares of stock prices have significantly increased in recent days, and Meredith hopes that kind of performance continues as drilling results are released in the fall.

For more information:

http://www.vggoldcorp.com 

VG Gold Corp. 

Suite 520, 65 Queen St West 
Toronto, Ontario Canada
M5H 2M5 

Tel: 416-368-0099 
Fax: 416-368-1539 

Thomas Meredith, President
416-368-0099 - Ext 4100