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This week on The Millionaire Choice Podcast, Tony talks with Max Porterfield, CEO and President of Callinex Mines Inc. Tony and Max discuss the precious metal industry, sharing wealth, and the power of positive thinking.
Max Porterfield is an experienced CEO with a demonstrated history of working in the mining & metals industry. Mr. Porterfield has over ten years of experience in natural resources and financial markets, previously with Brazil Resources Inc., Uranium Energy Corp. and US Global Investors.
About Max Porterfield
Growing up in San Antonio, Texas, son of a middle-class family, Max learned much of his strong work ethic from his father. After losing his mother at age 21, Max graduated from Texas Tech University with a bachelor's degree in business administration.
Fresh out of college, Max got his first job at a natural resource focused investing firm. A habit of surrounding himself with “successful people” helped grow his experience in business. Having said, “if you control your mind, you control your outcome,” Max believes his success is due in no small part to how he perceived his opportunities. Self-driven towards prosperity, he is now the CEO and president of Callinex Mines Inc. in Canada.
Learn more about Max Porterfield, https://callinex.ca/
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Show Transcript
Tony (00:00):
Welcome back to the Millionaire Choice show. Today, we're gonna be talking about some mining. We're gonna be talking to Max Porterfield, the president and CEO of Callinex Mines INC. out of Manitoba, Canada. The interesting thing about Max is he actually took over the CEO in headship of Callinex mines at age 31. So, he's a young CEO, mover, and shaker, and doing some great things up there. We're gonna learn a little bit about mining, especially around copper and what copper means to the industry in the world. You can't do anything technologically or electrical without copper. Can you, Max?
Max Porterfield (00:38):
No. That's why copper is known as "Dr. Copper." It's the building blocks of the global economy. Copper is used because it's a great conductor, and you're right; it's predominantly used in electrical wiring in your home, your vehicle, etc. There's a lot of things that take advantage of copper. You don't realize it every day.
Tony (01:02):
Now, I grew up the son of a carpenter, so, interesting stories about copper; whenever I'd go on the job site and there'd be some leftover electrical wire. I was scarfing the electrical wire, stripping it down and selling it to the metal salvage guys and making a little side money from copper. But, one thing I didn't realize, and this is sad; the state of the world is that people would actually break into job sites and strip the copper out of HVAC units because they were desperate for drug money. And, as a young guy learning about that, I'm like, "what? That's so, so terrible that that's what people are driven to pull that out!" Just something I learned on the side.
Max Porterfield (01:49):
They're gonna more and more driven to do that every single day. Cause we're at an all time high for copper prices. And, you've had a lack of investment in the copper business and the supply side; discovery and development of these mines, where you are having demand now outstriping supply. You actually only have about a three day supply in the copper inventories right now, which is very, very tight. So, last time you had copper north of $4, it was quite popular to steal copper, and that's just gonna be more and more popular moving forward. It's just like catalytic converts; when all cars were deemed to need a catalytic converter for environmental reasons, that had a huge demand driver for, platinum cause each catalytic converter needs to have a little bit of platinum. Platinum was in tight supply. Platinum was a really performer in terms of investment, cause demand shifts, but that's why you see catalytic converts get out of the bottom of cars all the time; it's because they're actually going for that gram or gram and a half of platinum.
Tony (02:52):
Wow. I would've never known that because platinum's price is north of a thousand dollars. Where's it at right now?
Max Porterfield (02:58):
It's definetly north of thousand dollars. I don't follow the platinum markets candidly. I'm more focused on the base and then just the normal precious metals in terms of gold and silver prices. But, these demand drivers that can shift due to government policy have big ramifications that policy makers don't necessarily look done chain in terms of, "what kind of policy decisions are we making, and what are the ramifications of those policies that we're putting in place?" So, like platinum, copper is gonna be one of those that's gonna be benefiting from government policy, predominantly with the electric vehicle shift, as well as global infrastructure spending, for these charging stations, and rebuilding the bridges, roads, and electrical grids that need to be updated; they're gonna have a big demand on the base metals in particular with this finite supply caused by a lack of investment for the exploration and development of these mines.
Tony (03:57):
It's interesting you mentioned that- I'm more familiar with the silver market, but the gobbling up the silver industry; JP Morgan, Chase Bank has been buying up silver for 10 years, of course, Russia, it's big in the news right now. China and a lot of other countries have been gobbling up gold, but a lot of times you overlook things like copper, or zinc, or some of these other metals that kinda help the industry keep going and society keep going. Now, I gotta be honest with you. I don't know a whole lot about mining. It's one of those things- you look at most investors and future millionaires- I think that's why I love doing the shows. Cause, I learn so much on the show from the different guys we have on, but the go-to thing for most investors when they start investing is gonna be straight to mutual funds.
Tony (04:39):
You got Dave Ramsey out there pushing it. He's one of the most well known financial teachers in the world today. And, mutual funds are his thing. Real estate would probably be his other thing that he talks about a lot. And then, business- some of your other guys, David Bach, "Automatic Millionaire," I think he leans a little bit more towards mutual funds. Robert Kiyosaki leans towards, real estate, but you don't hear very many people talking about mining as a possibility or a play for building wealth or being part of your portfolio. Do you?
Max Porterfield (05:09):
No, it's probably not top of mind for most people, but I think that if you look in terms of wealth creation; there are few places that you can create as much wealth as quickly as you can than in the mining business. Now, nothing comes easy. That's a fact, but you can certainly create a huge amount of wealth in the discovery of these deposits that go on to producing mines. So, in mining, there's three different Sub-sectors; there's exploration, there's development stage, and then there's production. And, obviously, each different Sub-sector within the industry has different risks. Exploration's the highest risk, but that's where you get the highest reward because you're essentially going to an area that you think is perspective, and then you have an "exploration hypothesis" as in terms of why there'd be a large deposit sitting there that you're looking for and then drill testing that. And then, what down my expertise happens to lay in, and what my focus and vision is for our company. But, no, there's different phases; typically exploration's gonna be similar to a biotech company, where we're research and development heavy; just like a biotech stock. You'll be de-risking a biotech stock or a biotech stock will be risking their business through research and development and going through clinical trials to get their drug approved where our research and development and de-risking on the exploration side is our exploration thesis to find a large discovery, which is what we're up to.
Tony (06:54):
I think, what comes to me as an example is; you're looking at how your company can add value at the different stages of development- which you mentioned research, exploration development, and then production. I didn't know that about cows though, but cows are the same way. You have the birthing and they add value there. And then they have ranchers that add a certain amount of weight onto the cow. Then they resell these cows at different stages. It's a weird analogy to bring up.
Max Porterfield (07:24):
Well, it's a commodity. I mean, everyone can look at animals in different way, but cows will trade as a commodity just like pork in agriculture. So, in the world if you can touch it; it's either been grown or raised, as in the cow's situation; it's been mined or pumped outta the ground, in oil and gas' situation. So, there are strong similarities where you add value. It's just the supply chain, as you take the commodity and then turn that commodity and use that as material to build different products. You're gonna add value. So, we're just happen to be on the first part of the value chain where you're actually drilling to discover these deposits to give you this scale in terms of- this was a mine that's operating. It's actually due to shut down in a couple months, which is a unique business opportunity for us.
Max Porterfield (08:14):
But, the 777 mine, since it went into production in 2000, has thrown over a billion in tax revenue alone to both the federal and provincial governments of Canada and the provincial government of Manitoba. Again, it's big business within the very early stages. As I mentioned before, it's really the building blocks. So, the global economy; you can look at cows as the building blocks of your meal. And, the birth of the cow is the very first stage of that. That's what we're involved in, the discovery, except we're not discovering or raising cows. We're discovering potential mines.
Tony (08:51):
Now, you didn't start in the mining industry, and you didn't grow up in a mining family, did you?
Max Porterfield (08:56):
No, I grew up in San Antonio, Texas, and I was actually born in west Texas in Odessa, Texas, which is known for WTI, or West Texas Intermediate oil. Traditionally, I heard a lot about oil growing up. My first job coming out of college was actually at a natural resource centric investment firm that focused on investing in not only the gas stocks, but in particular mining stocks was their core competency and expertise. So, that kinda led into what I'm doing now in a unique way.
Tony (09:34):
Now, you seem to obviously know about the ins and outs of investments- running business and things like that. But, growing up as a kid, did you come from a wealthy family or did you come from low income? What was your background?
Max Porterfield (09:45):
I came from a middle class family. My father obviously had a very strong work ethic, and you see that growing up and you emulate that. I'm a big proponent of surrounding yourself with successful people. Successful people have a similar mindset and a work ethic and pattern to them. You inherently pick up off of that. So, you obviously have to do the work, but it helps to understand the mindset to be successful; because, if you control your mind, you control your outcome. I am a big believer of that. If I didn't believe I was gonna find a very big mine; then I would never go out and find a big mine. Believing is the first step to that. So, I grew up in middle class family and that afforded me different opportunities which I'm very grateful for.
Tony (10:36):
My mom and dad came from a more of a low income family, but they were very much empowering me mentally to try to be all I could be; to be the best version of me. They did the best job that they could with what they had to work with to help get me there. It sounds like you had a dad and family that was very similar?
Max Porterfield (10:55):
I had unwavering support from both parents throughout my life. Even when things have been very, very tough. I think a lot of parents might call into question, "what is this kid doing?" Mine didn't; they're very supportive of the objective and long term goal and I like to reward them for that; supporting their son through the process; they are large shareholders of the company as well. So, when I succeed in my professional endeavors, we all share in success; themselves included.
Tony (11:27):
Oh, I love that. I love that model. So, your parents are investors in your company as well?
Max Porterfield (11:33):
Yes, very large share holders. So, my family collectively owns just over 10% of Callinex, and they've continued to add to that and build that position through the ups and downs of the company's growth trajectory. I'm very, very grateful for that support in looking to return that favor with success.
Tony (11:55):
I love the concept of that. I think in my family, my parents weren't very investing minded, and still to this day don't have any investments other than the house that they live in. My mom passed away several years ago. It's just interesting when your mind shifts, but those around you; their mind doesn't shift with you, and there becomes a little bit of a separation there. It's just a very interesting process. Now, you lost your mother at a young age. You said like 20 years old in the pre-show?
Max Porterfield (12:26):
About 21, yes.
Tony (12:29):
So, about 18 years. She was there as she was investing in you and got to spend some time helping you go through this young 18 year old guy figuring out life to transitioning more into who you are today. Were you making that transition at that age or was it a little bit later?
Max Porterfield (12:47):
My mother was with me in unique ways. I think that she was very obviously supportive; she was my best friend growing up; was always supportive of me. But, in terms of when I took over Callinex; that came much later. But, you never forget the lessons that your mother taught you. So, I've never forgotten about her. I know that she's with me in her unique way. I'm a believer of that, not to get into that, but the benefit of having supportive parents; both mother and father and extended family as well. When you go on the path of being an entrepreneur, it's good to have people that believe in you and support you when things aren't always so rosy because "the tides can turn," so to speak.
Max Porterfield (13:32):
And I do resonate as well; when you change your mindset and that's not in line with other people's mindsets; it can be an uncomfortable position to be. I went through the same similar thing myself when I first took over Callinex. I was really more negatively driven; I was really driven by the fear of failure. If you'd asked me, "Hey, what drives you?" I worked very, very hard, but my answer would've been, "I'm working so hard cause I'm afraid of failing. Failure is not an option." Whereas, when the company went under some pressure just cause of global economic factors that were taking place in the zinc market, cause we have some zinc assets. You had to question, "why are you doing something?
Max Porterfield (14:13):
What is the purpose of what you're doing your life? Because you are only here for so long." Through that process; it changed my mindset and my mindset had a dramatic shift, where it was prosperity driven; where the only outcome was success and the success was driven by a positive mindset that we were going to succeed. So, it was no longer driven by negative failures or the fear of failure, but only the certainty of success. And, "why did I get long winded on that?" When you change your mindset, people are not used to that because they're used to the old version of you; the pattern of mindset you might have had; which was a more negative mindset, but negative mindsets drive negative outcomes. So, when you shift that, and people might not be necessarily ready to shift with you, but you've gotta understand that it's just cause it's a very, very uncomfortable path for others to walk; particularly when they don't think in that way.
Tony (15:08):
You're stretching everything- you, yourself are expanding, shifting, expanding, but the people that are in close proximity to you experience that as well.
Max Porterfield (15:17):
Yes, cause your consciousness is expanding in many ways. Your awareness of the situation. The reality that you can change your outcome with your thoughts is a little bit overwhelming for a lot of people to grasp and appreciate. So, when you're going through that; they're either going, "this guy's the craziest person in the world," or, "he's brilliant." And so, fortunately, I think I have been more on the brilliant side, cause we hit a very high grade copper discovery. That's led to a lot of success. I think I put to rest those questions in terms of, "what's going on in this guy's head?" Because, when you take a kick at a can in exploring a certain area; often companies will leave after one or two rounds of failure. But, I had a personal dying conviction that we were gonna have success in a particular area.
Max Porterfield (16:00):
When we made our comeback, the only option I had in my mindset was we were going to succeed, and ultimately we did succeed. We hit one of the highest grade copper discoveries. But, that's all a product of your mind. I mean, if you look at an artist; what an artist produces comes out of their consciousness. Just like an entrepreneur or whatever; what an entrepreneur produces comes from their consciousness. They had to have an idea or dream to go out and produce that in the physical world where other people can benefit from that. So, that's inherent in any business or entrepreneur; they're trying to create. It has to come from an idea; that idea comes from your consciousness. Therefore, you have direct impact on that.
Tony (16:39):
I love it. I'm going on this journey now. This is not what intended to talk about today, but I wanna do a study on this- I'm not there yet, but it's almost like, when you look at the world; we know there are physical laws that govern the world. You have, the law of gravity, the law of thermodynamics- there are certain things that just are; they exist and the world works because these things; these laws exist and I'm starting to become a big believer that there are these spiritual laws that govern too. You're talking about the power of a positive mindset and how that affects- "what you speak into existence comes into existence." Some people call that- depending on the circle you're in- just ridiculous, or negative spiritual, or something weird. I'm not a believer in that. I believe in like- you've got that. You've also got the power of attraction; law of attraction. You've got karma. "What goes around comes around."
Max Porterfield (17:35):
Have you ever read, "The Alchemist?"
Tony (17:35):
No, I haven't.
Max Porterfield (17:38):
You shoul read that book.
Tony (17:39):
Who wrote that one?
Max Porterfield (17:41):
It's by a famous author, Paulo Coelho, he is Brazillian. It's sold about 85 million copies. But, that whole book is very similar to my own life's path. The main character, Santiago, goes on to meet different people that are spiritually gifted that teach him different lessons. Each one of those lessons happens to be aligned with some of the things that you mentioned; the beginner's luck, karma, etc. The overarching lesson of the entire book is that if you believe in something that you wouldn't achieve enough; the universe will conjure in different ways to help you achieve those objectives. I can say, in the book's case, Santiago is on a journey to go find a treasure that he had a dream about. And, my dream in my life was always that we're gonna find a treasure in this particular area to help a town.
Max Porterfield (18:39):
And ultimately, when I learned to believe in myself, which was the big shift I mentioned in my mindset earlier- when Santiago ultimately learns to believe in his own self; he ultimately finds the treasure and the treasure was actually where he originally dreamt it to be. So, that has a lot of parallels in that book, but also parallels to life, which is why it's sold 85 million copies. it isn't necessarily just cuz it's a great story, but there's a lot of lessons within that story that hold true in terms of universal laws that aren't typical in terms of science based laws. But, I think the world is shifting in terms of science around that; with the mindset and thought and the idea of how thought can be impacted when you go through meditation and you talk to your subconscious mind and you walk yourself into a subconscious state to reprogram your subconscious mind, you can lead to a completely different outcome. I'm a product of that.
Tony (19:40):
I love that.
Max Porterfield (19:41):
I just happened to read the book.
Tony (19:42):
I'll need to pick it up and read it. It's just a very interesting thing cuz you see a lot of these things; people are writing these books, like the "Law of Attraction," "Powerful of Positive Thinking," like all these different books and then, I'm a Christian. So, I study the Bible, and I look in the Bible, and a lot of Christians get freaked out by this stuff; They're like, "oh that's, a taboo. You shouldn't be-" But, I'm like, "man, the stuff's in the Bible. Jesus talks about 'doing unto others what you'll have them doing unto you.' That's one of the golden rules!" Whereas the other one is karma, which is what goes around, comes around. Those are like the same things said two different ways.
Max Porterfield (20:18):
I think that if you look at the basis, which is why I think people feel very uncomfortable, because they tie so much of the world's belief to their own beliefs, and then they want to really not be open to hearing other things. But, I think if you look at all the major religions of the world; the underlying truths to them; they really lead to the same outcome. The idea of prayer and repetition is really a way that you trick your brain into a subconscious state. So, if you look at meditation, it's very similar through all different religions, whether it be Christianity; the Catholics have the rosary; the Buddhist and the Hindus have the mala, but they all are reciting a word that may not be so familiar to them in a repetitive state. When you do that, it can drop your mind into idle state. So, their is science behind it, but everyone's relied on the religious aspect of what it's supporting and leading into. So, I do believe that they're all uniquely tied in one way or another. I think the world spends far too much of its time fighting with each other trying topress their belief systems on others; because ultimately the outcome is the most important thing. Are you a good person, and are you contributing to society; more-so than how you got to that point?
Tony (21:34):
Good points in general. I'm a big believer. We won't go down this road too far, but when you talked about too many people fighting- I'm a big believer that there's negative forces that are instituting that fighting because they are trying to keep us from engaging in spiritual growth, spiritual enlightenment, and the awakening consciousness that would propel us forward and help us grow into better places. When you look at some of the world's problems, just think about poverty or world hunger. I'm like, "there's so much money and wealth in this world. There's really no reason for anybody to be going hungry. It's not that expensive to go feed people. If we just decide as a society to go feed the people that are starving." I'm a big believer in that.
Tony (22:16):
It's just that, the people who have all the money aren't really that concerned with it. It's not really meeting what their desires or their agendas are, but that's probably a topic for another day. So, let's get back and talk a little bit about- you came up in a middle class family, got into mining, and now you're the CEO and president of this company. Let's talk about how people might invest and put a portfolio together; mining, how would it fit into their portfolio, and where they can look for these kinds of stocks and investments?
Max Porterfield (22:44):
Well, I think that, in general- I'm a big believer that it's a real asset. I think that if you look in terms of what's going on in the world and the Dwight Eisenhower. Eisenhower actually warned of exactly what's going on today in his fair-well addressed in 1961. Deficit spending has been a big theme since Eisenhower left office. He warned about deficit spending and a Fiat currency, which happened in 1973, when the us actually left the gold standard. Prior to 1973, every us dollar was backed by gold. That's what kept politicians in line for not having deficit spending in such huge forms. So, I'm a big believer real assets, commodities are real a asset; they'll perform well in a inflationary scenario.
Max Porterfield (23:36):
What really underpins supply demands- what I look for in investing in real assets, no different than a housing. You wanna buy a house that's gonna be a home that people are gonna wanna live in an area that they wanna live in. And, of course that'll help appreciate it. But, no difference in terms invest in these companies. A lot of these companies are listed predominantly in the Canadian exchanges. They have secondary listings in the U.S. and OTC, for example. For a lot of the smaller exploration companies like Callinex, I recommend or advocate for a basket approach to these type of companies, that would make in 10-15% allocation to a broader portfolio. But, I do look at it as a diversification of real assets. If you go and buy a Bitcoin- I won't get into the whole cryptocurrency world, but a Bitcoin or cryptocurrency performance is really closely to a stock, you have, there's an idea of a finite supply, which is why people are attracted to some of the coins. Others; those are not. Whereas if you look like at a mining stock, like Callinex, each share is gonna be backed by the assets in the ground. So, a portfolio should invest in real assets; commodities being one of them, and ones with a rich resource base that's growing. If you're looking at an expiration stage company, because the growth of the assets are growth of the resources that are in the ground, which the company's gonna have deemed value upon.
Tony (25:02):
Now, you mentioned the specific mine that you've guys are this you found up in Manitoba; I believe that's where you said it was at; and you called it a high grade copper. What does that mean?
Max Porterfield (25:13):
So, most of these mining companies you look at; the exploration companies; they'll take an old deposit, and they'll give a new spin on it. Or, oftentimes you can buy a deposit just like you can buy a home in an area of town that not everybody wants to live in, but it can go through a re-gentrification of that area. Or, a bunch of investment goes in that area to bring that area up to snuff; the same kinda thing that can happen in a mining asset. Oftentimes companies don't wanna go out and risk actually discovering a deposit, but they'll go and acquire a deposit and then hope the metal prices will come in favor, like right now where it would be like a really cheap option call on an asset.
Max Porterfield (25:58):
Other companies; like ourselves; will take on the much riskier part; which, we actually go out and explore. So, what we did is we went out and explored in this particular area I had a strong conviction on, and the team did as well. We hit one; we had three holes into the discovery in 2021. We spent the past full year in delineating that resource. So, we're putting a bunch of pattern of holes to show how big this deposit sits underground. That's part of the delineation. In terms of being high grade, which is the first part of your question. The global average grade copper miner around the world is only half a percent of copper. And, these come from very, very large, low grade open pit mining operations in Peru, for example.
Max Porterfield (26:44):
So, you have to move a lot of material to get a little bit of material; we're talking half percent is the global average in terms of the grades at rainbow rainbows had grades on average, of everything we've announced state and roughly north and 4% copper, which would put us in one of the top 10 highest grade deposit in the world. Once we get to size to be in the top 10 highest rate compromises in the world; you need over 3.75% copper. In terms of where those are located, many of those top 10 mines in the world are located in central Africa, namely the DRC or the Congo, which are, let's just say, "unstable" supply sources for these mines. So, we're very, very high grade discovery. We also carry gold, silver and zinc as byproducts, but in terms of high grade, I think really anything over 2% copper would be considered a high grade copper on a global basis.
Tony (27:36):
And you said you guys are at 4%?
Max Porterfield (27:39):
4% on what we've announced so far. We're pre-resourced, so that's the unique part where we drive a lot of values. You make the discovery, and then you delineate it with a bunch of polls into that. And, then you turn it over to an independent modeler, and they model the resource independently and state; What is the volume, the grade, the amount of copper, zinc, gold, and silver that are in the deposit? And, we're working to publish a main resource; or initial resource; on the rainbow deposit that we discovered in late 2020 later this year, which would be a key milestone for our company. So, really we came from an idea, we changed our mindset, which led to different expiration tools that we use to find the deposit. Now, we're showing what's there through delineation; drilling there to publish the domain resource. And then, what we're also gonna do in tandem to that is take the expiration model that led to the discovery of rainbow, and then replicate that on a regional scale, on a very large land package, which has never taken that approach before, historically, which is the RND part of the business that I mentioned earlier.
Tony (28:43):
I think for future millionaires, listen; I'm geeking out a little bit cause I'm learning something new and I'm from an engineering background. So, I love all the details, but some people don't wanna handle or can't handle all the details we're throwing at you, but let me dig some a little bit here. So, when you basically buy a piece of land; how many acres are you dealing with up there right now?
Max Porterfield (29:03):
We have 5,500 square hectsares.
Tony (29:06):
Please translate. Can you translate that into square miles?
Max Porterfield (29:11):
The productive trend that we're exploring spans about nine miles.
Tony (29:17):
Okay. And, when you drill that, you're basically griding out that, or are you doing a complete grid on it? What are you doing?
Max Porterfield (29:23):
We're actually drilling a small section of the deposit. These deposists, on average, are only 150 meters long. That's called strike mining. They only average 48 meters wide; meters are about a yard. Then, they'll go very, very deep. So, what we're doing is delineating that in a very small area, again, it's a 50 meters strike, or link, and we're delineating that within the first kilometer underground. There's 1.6 kilometers in a mile. I grew up in Texas, but I live in Canada. They use a different metric system there. So, what we're doing now is we're using the same tool set that allowed us to discover rainbow, which only has again, 150 meter strike in a very limited width. We're looking for other rainbows on the property using the tool set technology that we use to find rainbow. Because again, you have to change your mindset to change your outcome. So, what we did is we changed our exploration approach, using different tools that are not typically used in the business to find these type of minds in this particular area. And, when we were successful in discovering rainbow; we're now replicating that tool set over our entire land package to find more rainbows.
Tony (30:39):
Gotcha. And, once you guys get this paper documentation and stuff that basically becomes a pitch pack? And, you're looking for another mining company; that's a development company; to come in and buy that out from under you guys. Is that how you work?
Max Porterfield (30:52):
Naturally, some of the exploration companies can transition to a developer and producer, and then other situations- more commonly the big producers development companies- depending on what stage the company's at- will look to be looking to backfill the production. Because, if you're a producer, your skillset might not inherently be in exploration of mines. So, a lot of these big mining companies might have exploration departments. They'll team up with exploration exploration companies like Callen X, once the smaller company takes the risk on and makes the discovery. Then they'll come in to acquire that because they need to make sure that their production profile stays at the same level. A company that's a producer is going be valued on the cashflow that they generate. A company like Callinex is going to be valued based upon the potential future cash flow that the asset will generate in the future. We're gonna trade it at a discount to that.
Tony (31:48):
Now, when you guys sell that package of investments, the research that you found, or the mining stuff that you found; do you guys retain a partial ownership in that when it goes over to the developer or the producer?
Max Porterfield (32:02):
It depends on what the negotiated terms are; you can get taken out straight away. You can get taken out subsequent and have a royalty that trails. You can do a joint venture where they'll have a certain interest in the property that they'll earn into based on a certain value. So, it really varies very early onto that path. I mean, it took me seven years to make the descovery and that was really the first hole into the next phase of growth for the company. It was a journey for sure. But, I'm very grateful that we stuck with it for the outcome
Tony (32:38):
Now, I'm assuming- before we go today- boys with toys; you have all this mining gear out there. Do you ever go out there and operate any of it yourself?
Max Porterfield (32:48):
No, I do not operate that. We actually subcontract all the the work to drill companies that have the drills. I do go out there to be at the drill. I was out there when we actually physically made the rainbow discovery, which is obviously a memory that I'll never forget. It's the most exciting moment in my life to date. But, no, I don't operate the drills. I know how they work, but I leave that up to the experts. Like any other business. I wouldn't wanna be one doctor.
Tony (33:16):
That's true. I just think of playing in the backyard digging holes, and I'm like, when you're around a shovel; you gotta pick it up and do something with it.
Max Porterfield (33:25):
Just to give you an idea of costs; we're paying on a per-meter basis. So, every meter that we drill, you're talking an all in cost about $225 (Canadian). So, when you're drilling; a hole can sometimes be 1600 meters. So, you can see how the cost can get up there pretty quick. So, we don't mess around too much with the drills; they're quite costly. You actually need a driller and a drill assistant that's helping the driller out. So, there's two men that operate the drill and there's a drill foreman that coordinates everything between multiple drills as we drill, it's a 24-hour operation.
Tony (34:09):
So, when you get the drill in the ground, you're running around the clock till the job's done?
Max Porterfield (34:13):
We drilled 35,000 meters last year, and we were drilling 24 hours a day for almost nine months straight. I mean, there's gonna be hiccups here where the drill shut down temporarily; when we're doing something, moving the drill, etc. That's a constant process that where there's two shifts; day shift, night shift; the drill never stops unless it's under maintenance, or moving the drill, or you're setting a new hole.
Tony (34:39):
I think a lot of people don't understand that, but when you've got, "time is money," and when you've got equipment; you don't want it sitting still. You want it moving 24/7.
Max Porterfield (34:47):
I mean, the drill charge is based upon- I don't owe the drill company, but the drill company is gonna have debt on the drill. To service the debt, you need to keep the drill operating as much as possible. So, it's much more effective to keep the drill going 24 hours a day. Again, it's like an airplane, the airplane is making money when the airplanes flying, and not when it's sitting on the tarmac anywhere.
Tony (35:14):
Definitely. It's been wonderful having you on the show. I've learned a lot, Max, I really appreciate it. So, how are people gonna find out more about Callinex Mines, plug into what you're doing, and maybe take a look at some of your over the counter stocks?
Max Porterfield (35:27):
Absolutely. Well, you can learn more on our website at Callinex.CA. We trade in the United States on the OTCQX exchange, ticker CLLXF. And then, if you happen to be able to invest in Canada on the Toronto venture where our primary listing is, it is ticker CNX.
Tony (35:52):
That sounds awesome, man. Well, give it a look and check some more things out. Is there a portfolio or anything like that located on the website; different things people can look into?
Max Porterfield (36:02):
We put up all our news releases which are quite exciting. I mean, again, anything over 2% copper for underground is very high grade when you look at the news flow. But, under our investor section, we have an updated corporate presentation that goes through each of the assets. And then, I do a lot of different commentary out there where I talk about the business, which I'm sure you can find those on YouTube or any of those other podcast platforms. I learn less by watching than listing repetitively. So, I surrounded myself with some really distinguished experts, and exploration, so I feel like I have an honorary degree in geology, in geophysics, but I did that by surrounding myself and repeatedly seeing those type of things.
Tony (36:48):
I love what you said earlier about diversifying your portfolio. I think you've mentioned the number 10-15% allocation. A lot of times, I hate to say this, but a lot of people have got a lot of their money and their wealth tied up in the stock market right now. We're at all time highs, and that could be a good thing; could be a bad thing. Personally, I think it's a bad thing long term. So, I'm a big believer that real wealth is wrapped up in land real estate, gold, silver, precious metals, and small business for business. And, it's fine to use the stock market to build wealth, but understand the risks and everything that's going on right there. Thanks for being on the show!
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