Smart Partnerships, Acquisitions Broaden Path Forward

Q: What are the main changes the company is making, and why are they being made?

A: We are adapting to how Mexico has been changing over the years and particularly now over the past months the global changes and effects are driving us to rapidly evolve our work in Mexico. We acquired some additional great assets last year that allowed us to move ahead, and we are motivated. I would like to cover three points of our strategy. One is bringing in BHP, which allowed us to work on big copper. We are able to combine technological knowledge. I have visited Mexico many times this year and we have a strong team in Mexico growing our business even in the challenging times. Part of having this team is because we had Alberto Orozco join us and he is now vice president of corporate development for the company. He knows many people, he organizes events, meetings and innovative business platforms. He is the president of the Sonora Mining Cluster, where he is active in coordinating and representing the Mexico mining for Sonora state with the Federal government and industry wide.  A second leg of our strategy: to move ahead with developing assets in Mexico. Once we had Orozco and people who had worked with him in developing gold mines in Mexico, we were ready to move ahead with the formation of a spinout gold development company, Capitan Mining.

The third part of the strategy we have been developing is diversifying beyond Mexico and doing business in Canada, where gold is present. The final part is that we have staked and received mineral titles in multiple mining districts and are moving ahead with active exploration and deployment of capital. Riverside has cash and if we have titled properties, we are good to go toward making discoveries.

Q: Why did BHP decide to partner with you?

A: We focus on quality and working safely and integrating with communities in Mexico.  This plus our technical operational team are a fit that allowed BHP to partner with us to undertake a multi-year generative exploration program in Mexico. We have been able to operate for companies such as Kinross, Hochschild, Antofagasta and Cliffs Mining in the past pushing for discoveries in gold, silver, iron and copper. For us working with BHP is a great fit, leveraging off of our as well as BHP’s experience and merging both companies' data.

Q: What is the future of your partnership with BHP?

A: It is an exploration-funding agreement. BHP funds the mineral exploration and we provide the staffing and manage the operations. This can lead to big discoveries where BHP with its strong balance sheet can rapidly and extensively explore and develop discoveries. Mexico has giant copper deposits like La Caridad and Cananea and we believe more can be found particularly if the government will grant new mineral tenures and cancel inactive ones. When a discovery is made, BHP will take it over 80/20 as the fully fund the program. We provide sweat, work and we go through a generating phase, a project development phase and eventually a JV phase. If we choose not to participate financially, there are other criteria where we can participate without having to put in capital, always keeping a royalty for Riverside’s interest. Putting in 20 percent of the funding could be deluded, but it works for us if it is on BHP’s scale. We could always sell the percentage as well.

Q: How many spinoffs are in Capitan Mining?

A: We are initially spinning off the Peñoles project. This is an open pit gold-silver district with extensive drilling and a nice resource that we are expanding with the company Capitan Mining. At the moment, Capitan Mining is focused on growing, with intense drilling and exploration programs at the Peñoles project. We are looking for additional acquisitions as we move forward toward a larger resource there in 2020. A recent drill program found a high grade of silver and a broader gold base. We welcome working with the government and communities to progress in win-win ways the resources of Mexico.  Riverside has built the capacity to developing assets over time and now with Capitan Mining this can expand. Now, this special purpose vehicle can take on the challenge to progress this and then other mining districts. We have already secured the financial resources we need to progress Capitan.

Q: How will you measure success for 2020?

A: Two of the ways we measure success are share price and also business growth. Share price is in part based upon our work but also largely effected by the overall market conditions as well. 2020 has really shown this with the COVID-19 virus and tremendous changes which for us we measure success by surviving and growing our business. The second measure for us is discovery and we do this through partner work with BHP and other JV efforts in Mexico plus our sole funded work. As we move forward with BHP, we have projects that fill a nice pipeline for discovery. We also have the Los Cuarentas, Cecilia and other projects in Sonora. 2020 and into 2021 will be exciting times for the company.

Riverside is a well-funded, value-driven exploration company advancing a strong portfolio of gold, silver and copper properties. It has started spinning off projects in Mexico and founded a new company to produce them.