North Bay Resources Inc. (OTC:NBRI) is distinguishing itself as a micro-cap company with an eye on near-term production.
The company operates and holds a majority stake in the Bishop Gold Mill located in Inyo County, California, which has a 100-ton-per-day capacity.
“Small-scale production wasn’t even on the radar five years ago and now it seems like a very smart place to be as opposed to pure exploration,” North Bay CEO Jared Lazerson told Proactive.
“The exploration market has become very difficult for a variety of reasons. This is a different way of thinking.”
Lazerson has been involved in mineral exploration for 25 years as the founder of MGX Minerals, where he also served as CEO from 2014 to 2020. He joined North Bay, which has traditionally been a gold and copper explorer with projects in California and British Columbia, Canada, as its CEO in February 2024.
The company’s current focus is preparing the Bishop Gold Mill for production and, in turn, cash flow, by the end of 2024.
Lazerson said North Bay ideally wants to build out its feedstock for decades.
“We are now in the process of acquiring ounces in the ground, so gold mines that were past-producing or near-production exploration properties through joint venture and direct acquisitions.
“This is just a straight one-step to production.”
Readying the mill
The Bishop Gold Mill was permitted in 2019 but was never operated. Due to its location in a dry, high desert area, it was acquired by North Bay with its equipment in “as new” working condition, including the mill building and the tailings pond.
Much of the mine’s value lies in its permitting.
“This is one of the very few mines that have been permitted in California in the last 20 years,” Lazerson said. “Minor infrastructure upgrades and approvals are required to flip the switch and we have already completed most of the infrastructure as part of our equipment testing.”
North Bay is currently confirming that the mill’s equipment is in working order. It has tested the jaw crusher, ball mill, shaker table, flotation tanks, and related conveyors and ancillary equipment, with all found to be in good working order.
“We had done due diligence and everything looked fine but you never really know until you start running things, and everything is going exceedingly well,” Lazerson said.
With a capacity of 100 tons per day, the mill is set to process about 3,000 tons of ore per month. At a grade of half an ounce per ton, which it has secured through the Fran gold project joint venture, the mill should produce gross revenue of $3 million per month, according to Lazerson.
By the end of December this year, the company expects the mill to generate gross revenue of $10 million, of which North Bay Resources will take home about $3.5 million.
“These are relatively small numbers for mining but in terms of shareholder dilution, we will not have to finance moving forward,” Lazerson said. “Plus, we are setting up for a $15 million year for earnings before interest, taxes, depreciation and amortization (EBITDA). It’s a new deal for investors and given some time, there is a lot of upside in North Bay’s market cap.”
Building up feedstock
After acquiring its majority stake in the Bishop Gold Mill in April 2024, North Bay wasted no time in inking a joint venture agreement with MGX Minerals for the Fran gold project located in British Columbia.
“With the price of gold where it is, anything that’s a decent grade can travel,” Lazerson said.
More than $20 million was spent on drilling about 55,000 feet across 104 holes at the project, primarily at the Bullion Alley Zone, which defined a deposit 3,700 feet long, up to 120 feet wide, and with a depth of more than 700 feet. It features three to four well-defined parallel gold veins grading up to 2.6 troy ounces of gold per ton, in addition to wide sections of low and mid-grade gold in veins and disseminated in veinlets.
“We know where the gold is and how to get to it,” Lazerson said. “This project can produce sufficient initial feedstock for the mill under bulk sampling.”
Eyeing California and Nevada gold projects
North Bay has advanced its priorities in reverse order by acquiring the Bishop Gold Mill before acquiring mines to provide feedstock for the mill to process.
As Lazerson explained, there are numerous small, often advanced, mines with no processing capacity in California and Nevada in proximity to the mill. “It’s only a 100 tons per day mill, so we don’t need a huge amount of ore.
“These mines are way too small for Barrick, Newmont, or Kinross. They don’t bother with these.”
North Bay is actively engaged in negotiating acquisitions and joint venture agreements for gold mines in California and Nevada. The company has eyes on several projects, many of which are permitted and have modern equipment or stockpiles in place but nowhere to process the ore.
“What we are looking for is advanced projects that require one step capital investment wise and operationally to move to some level of production,” Lazerson said. “It doesn’t have to be large scale, but a single step to production.”
Additionally, after North Bay Resources has built up its feedstock, there is the potential to expand the mill’s capacity.
Lazerson said the mill could go five times bigger to 500 tons per day under the same physical footprint, but that this isn’t currently a priority for the company.
“We will run a tight ship for a couple of years and then go back and have the expansion conversation. Having cash in the bank and ongoing investment in and jobs and services for and from the local community obviously always helps with any expansion.”
Gold rush
Fortuitously for North Bay, the price of gold is hovering near record highs as the company prepares to begin production at the mill.
Lazerson sees gold prices remaining high for the medium term at least, as central banks globally invest heavily in the metal over the US dollar.
“You have a US dollar hedge and you also have another fundamental which is that people are buying gold globally but even in the US. Investors like the diversification of having gold bars,” he said.
He highlighted that the company is heavily leveraged against the price of gold for better or worse, which for right now means that North Bay is looking at “very good” margins.
The company is focused on gold grade to ensure that even if the price of the metal returned to lows seen about five years ago, it will continue to profit due its scale.
“Because we don’t have that much tonnage, we are focusing on being highly profitable, which is something you can only do if you’re small,” Lazerson said.