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Evolution excited about future of Red Lake

May 4, 2021

Australia-based Evolution acquired their first asset in Canada on April first of last year, the Red Lake Mine. Jake Klein was appointed as Executive Chairman in 2011, following the merger of Conquest Mining Limited and Catalpa Resources Limited. Previously, he served as the Executive Chairman of Conquest Mining.

By Kevin Vincent

 “Our experience to date has been great. Evolution is a small company formed about 10 years ago. We want to be the premier mid-tier gold company in the world. We have no aspirations to become a major.”
Klein says the best shareholder returns are earned in the mid-tier space. “We have assets in Australia and  Canada. We are very focused on trying to be exclusive to tier one jurisdictions. And we certainly picked Canada as a tier one jurisdiction where the rule of law can be relied on, transparency, skills, and workforce.”
Klein says Evolution’s strategy is largely predicated on three cornerstones. “The one is that the mid-tier space, 6-8 assets, largely driven around the fact that it gives, in our view, the best opportunity for shareholder returns, dividends and capital growth. It also gives us an opportunity to have a culture, which we really treasure at Evolution around inclusiveness, one free of prejudice and a family type culture, one where people really know each other.”
The feedback from employees around staying small is favourable.  “We heard that it’s a highlight of their career working at Evolution. Then the community is such an important aspect. “We see indigenous relations as an absolute priority from Evolution’s perspective as well.”
Klein says Canada and Ontario have attributes that mining companies should be looking for. “It has a great rule of law, transparency of that law, it has great skills in the mining sector, and it has great geology. If you combine all of those things, it became clear to us in 2017 as we were looking for an expansion out of Australia, Canada should be an area that we started to focus on.”
Evolution started to look at a number of properties in Canada. “In 2019, Newmont acquired Goldcorp, and Red Lake was a mine that they decided didn’t fit their strategic objectives. It was the right decision by Newmont. It was a mine they knew would be better in the hands of a smaller company. It was undercapitalized, under-invested in, and needed a lot of reform.”
Evolution did their due diligence. The results proved encouraging. “Our geologists came back from the site visit and I have to say, they don’t smile a lot, but they were grinning from ear to ear. They were beyond excited about the geological prospectivity and that’s what really got us excited about the Red Lake opportunity.”
“Red Lake has got all the hardware – it’s the culture and software that we believe needs to change. We made a number of changes on the hardware front, decommissioning 56 of the 140 pieces of equipment that were underground; decommissioning two of the five shafts that were operating, and automating two shafts.”
Red Lake was discovered in the early 1900s and has had continuous mining from the 1940s and is one of the great gold districts of the world. “To be able to secure a piece of Red Lake has been a phenomenal outcome for Evolution.”
Klein says the Red Lake property has exceeded the company’s expectations in every respect. “It’s a mine that we believe could be restored to one of Canada’s premier gold mines again. We have a long-term ambition of 300,000-500,000 ounces of low-cost production. We’re on our way in the stage one transformation, which we think will take up to 3 years to get to 200,000 ounces of production at less than 1,000 USD all in sustaining costs.”
Klein adds that the most standout aspect for Evolution beyond the geology and the opportunity has been the way the company has been embraced by the people on site, the town of Red Lake and Balmertown. “it’s just been phenomenal being welcomed into a new country. It’s a new area, it’s a new province, the way we have been accepted. That’s what’s got us really excited.”

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