Near-Term Cash Flow From Silver, But is it Big Enough to Matter? | Pinnacle CEO Interview

**Antonio** (0:00)
This video is sponsored by Terrahutton, who makes the invisible, investible. Today on our CEO BBQ, restarting a gold and silver historic mine in Durango, Mexico together with Pinnacle Silver and Gold. But if you're short on time, subscribe to our free newsletter, and once a week, we'll send you a five-minute summary of all interviews we put out, resourcetalks.com for a free weekly newsletter. Now, although this company has paid us for the production of this video, you should still understand that we are not financial advisors, and this is not intended as financial advice. It is a broad, general and impersonal piece of information intended only for those who know and understand the risks of junior mining, of which there are many. Before moving on, read the company's official filings on SitterPlus.ca and do your own due diligence. Pause the screen and read all the disclaimers I've shown you because your capital is at risk. If this isn't clear, go to the last section of this video for a longer explanation of the risks and biases. And do not consume this content if you don't agree with everything said therein. Moving on, this is not Pinnacle's first time on the CEO BBQ. I've interviewed Bob as recently as seven months ago. So if it's your first time hearing about the company, I'm going to post a link to a playlist containing all the previous interviews. Please watch those first as we're not going to be covering the basics here anymore. So the basic grilling and the smell test and all that, that was in that previous interview. This is rather going to be an update on what they've been up to since that last interview.
In a nutshell though, the flagship for Pinnacle is the El Patrero Project, which is a past producing gold silver mine in the Sierra Madre Occidental in Durango, Mexico. It's about 35 kilometers away from four operating mines, including Fresnillo's La Cinega to the southeast. El Patrero is a low-sulfidation epithermal vein system hosted in andesites as you might expect for that part of the world. So that's nothing special there. Pinnacle is currently running on underground delineation drilling program on it after finishing rehab and sampling with some metallurgical tests already in the books showing decent gold recoveries. But the silver was a little more questionable. So of course, we'll talk a little bit more about that later on in the conversation. The first assay results from that drilling are still not in though, but they should be. They should start coming in over the next few months or so and that should feed straight into an eternal resource estimate plus preliminary mine plan and notice I'm saying should, because we have a lot more questions to ask about that later on in the conversation. And of course, that's all happening alongside the permitting work needed to refurbish the on-site plan. It's a 100 TPD plan and they're targeting a production restart by the end of 2027 So this is near term, but this is also Mexico. So permitting is of course going to be a part of the conversation later on as well.
Now for some of the numbers and a bit of the details here, Pinnacle is listed as PINN, so that's P-I-N-N on the TSX-V, where the three-month average daily volume is about 140,000 units. The stock's 52-week high is 19 cents and the 52-week low is 5 cents.
With a $14.5 million market cap and 147 million shares outstanding, today this is a 10-cent stock with a 50 and a 200-day moving average at respectively 11 and 12 cents, which means that the stock is now trading right below those two.
There are about 30.6 million warrants and just about 6.5 million options, collectively representing about 20% of the fully diluted 184 million shares. How much money do they have left right now after that? They just did a $2.5 million financing. So how much is left of that? How much are they spending on that underground drilling and all the rest this year? Will they be back to the market again later this year? And how much money will they need to bring it back into production by again the end of 2027? As you see, definitely a couple of money questions are going to be in order later on in the conversation. But for this to actually become a conversation, though, I'm going to have to shut up, unfortunately. And Bob, I'll give you the word here. But first of all, thank you for sitting down with us today.

**Robert Archer** (4:05)
Nice to meet you, Antonio. Good to see you again.

**Antonio** (4:07)
It's been a while since you and I have done a proper CEO BBQ. And as you can hear, this time, it won't be you. We won't only have to do with one annoying interviewer. We've got two now. So, Christian, I'm going to let you kick it off.