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Corporate Background
Q. What is Radius Gold?
Radius Gold Inc, is a junior gold exploration company trading under the symbol RDU on the Toronto Venture Exchange, and under the symbol RDUFF on the OTCBB in the US. Radius Gold was formed in July 2004 after the merger of Radius Explorations Ltd and PilaGold Inc.
The company is a focused Central American gold exploration company, working in Nicaragua, Guatemala, Mexico, Ecuador and Peru. Our aim is to discover new gold deposits and then sell or joint venture significant gold projects.
Q. How much gold does Radius produce?
Radius has no mining operations and no gold production. We are a pure, early-stage exploration company trying to discover new gold deposits. Our eventual aim is to sell the ounces we discover (or the company) to an established mining company.
Early stage exploration is an inherently risky business to be in and this is a key point for potential investors to remember. Many exploration projects fail the acid test of economic viability and are dropped or relinquished by the companies that found them. However, the potential upside for shareholders if a grass-roots project turns out to be mineable is extremely attractive. As a potential investor, you should be clear that you are comfortable with the investment risks associated with early-stage exploration companies such as Radius.
Q. What is the company's basic strategy?
We specialize in acquiring the mineral concessions for large areas of prospective ground in countries that have seen little modern exploration. We identify what we believe to be the main structures or geological trends controlling where gold deposits may form, and then apply low cost but rapid and effective exploration methods to identify new gold projects.
Q. Do you automatically joint venture each new project you find?
No. Each project is considered individually. In some cases we believe that our shareholder's best interests will be served by Radius conducting its own detailed exploration programs. In other cases, the potential exploration costs involved in completing a detailed program are high enough to justify spreading the financial and technical risks through joint venturing.
Q. How long has Radius Gold been active in Central America?
Our management team have been exploring in Central America since the mid-1990s, first as Mar West Resources and then as Radius Explorations Ltd and PilaGold, and now --after the merger of Radius Explorations and PilaGold- as Radius Gold Inc. We moved into Nicaragua in early 2003. Over the last decade, the team has successfully discovered and sold close to 4-million ounces of gold to Glamis Gold.
Q. Are you exploring anywhere else? Do you only explore for gold?
In exploration, focus is important -particularly geographic and commodity focuses. The members of our technical team are Central American and Caribbean gold specialists. We believe our shareholders will get the best long term return if we stick to the area and commodity we know best.
However, we are always evaluating potential regional "plays" throughout the broader Central American / Caribbean area and management will react rapidly to any project opportunities that are a good fit with Radius' overall exploration strategy of acquiring large land positions in under-explored, but highly prospective regions.
Although we do come across other commodities such as copper and other base metals in the course of our exploration programs, gold is our primary target.
Q. Have you found gold mines?
Yes. Our technical management team was responsible for finding Glamis Gold's San Martin mine in Honduras, and their Cerro Blanco deposit in Guatemala. Between them, these 2 deposits contain around 4-million ounces of gold. We also discovered the Tambor gold deposit in Guatemala which has a resource of around 270,000 ounces of gold.
Q. How many exploration properties does Radius have?
Radius has an excellent portfolio of high quality gold exploration projects. You can click on this link to view a map of their locations and names. Our project portfolio is constantly changing as we discover new projects or existing targets are joint ventured or dropped.
Q. What's your best project?
We're quite pleased with our Trebol property in the Region Autonoma Atlantico Norte (RAAN) of northeastern Nicaragua. On May 29th, 2007 we released initial sampling results where we found vein float and noticeable amounts of visible gold in stream sediment and quartz float in two areas.
Q. Who are the largest shareholders?
Our largest single shareholder is Gold Fields Ltd of Denver, with about 5.1-million shares or just under 10% of the company on an undiluted basis. Institutions own at least 18% of our shares on an undiluted basis, with directors / officers and management holding around 8%. Our institutional share holders include a number of major gold funds in North America and Europe.
Q. How do I get a quote for Radius's share price? What is the stock symbol?
We trade on the TSX-Venture exchange in Toronto. If you're searching for a quote from Canada, you can use the symbol RDU.V or RDU-V to get a quote in Canadian dollars. We are also listed on the OTCBB under the symbol RDUFF.
Q. I live in the US. How can I buy Radius shares?
If your broker can't buy Radius shares via the Venture Exchange in Toronto, we also trade on the OTC in the US under the symbol RDUFF. If you're still having problems buying, and would like to find a US-based broker familiar with the Canadian markets, please call us at 1-604 801 5432 or 1-888-627-9378 for a recommendation.
Q. Do you plan to raise any money in the near future?
Not in the near term.
Q. What are the political/economic situations in the countries where Radius is working?
All the countries where we operate---Nicaragua, Guatemala, Ecuador, Peru and Mexico---are politically stable with elected governments. However, we face different challenges in each country, and international business presents risks---particularly in developing countries like Nicaragua and Guatemala. Below are summaries of the political and economic situations in each of the countries in which we are exploring. For more information, you can follow these links: UK Foreign Office, CIA Fact Sheet, BBC Country Profiles, Infomine.
NICARAGUA
Over the past decade, Nicaragua has endured a dictatorship, a brutal civil war and the country-wide devastation of Hurricane Mitch in 1998. The political and economic tides are turning however, which is why we view Nicaragua as a country of vast opportunity.
Rebuilding
Constitutional democracy was restored to Nicaragua in 1991, and the country now operates under executive, legislative and judicial branches of government. In recent years, Nicaragua's leaders have focused on rebuilding the country's economy. Newly re-elected President Daniel Ortega, while openly defying the United States, has also recognized the dire need for foreign investment to foster economic growth. In that regard, he is opening many new paths to free trade, including those with the United States.
Promoting Economic Reform
The current Liberal government's priorities include economic reform under IMF auspices; relief from Nicaragua's massive debt burden, the encouragement of foreign investment and increased international development aid. In October 2005, Nicaragua ratified the US-Central America Free Trade Agreement (CAFTA), which will provide an opportunity for Nicaragua to attract investment, create jobs, and deepen economic development.
GUATEMALA
Guatemala is a land of enormous opportunity for mining. However, the country presents particular challenges to business. Guatemala was embroiled in civil war for 36 years before peace accords in 1996 removed a major obstacle to foreign investment. Since then the country has pursued important reforms and macroeconomic stabilization. In July of 2006, the Central American Free Trade Agreement (CAFTA) was ratified between the US and Guatemala.
Improving Economic Stability
Guatemala's constitutional democratic republic government has established a mandate for improvement in economic stability, financial sector restructuring and reforms to boost growth and reduce the country's poverty. Presently the distribution of income remains highly unequal, with about 56% of the population below the poverty line.
Mining in Guatemala
Mining investment is on the increase in Guatemala, and the country has been good to gold explorers over the last decade. Discoveries such as the Marlin gold system (under development by Goldcorp) and Radius's Tambor gold system sparked an upsurge in exploration in the country.
New Laws to Attract Investment
Guatemala boasts an extremely favorable geological setting and vast untapped resource potential. Given the country's recent troubles, however, it's not surprising the exploration sector only began to attract foreign investment in the late 1990s. That's when the government introduced new laws and changes to the Mining Code to stimulate the economy and attract foreign investment. These changes eliminated all tariffs on imported mining equipment and allowed 100% foreign ownership of mining rights.
ECUADOR
Although Ecuador marked 25 years of civilian governance in 2004, the period has been marred by political instability and economic recession. Since 1997, protests have contributed to the mid-term ouster of three democratically elected Presidents. New leader Rafael Correa has pledged to introduce sweeping reforms to promote stability and prosperity.
Surging Oil Revenues
As one of Latin America's largest crude oil exporters, Ecuador's economy is dependent on revenues generated from oil production. Thus the recent surge in oil prices is generating badly needed export revenue and helping to stabilize the economy. The country has also emerged as a leading exporter of bananas and coffee.
New Laws to Encourage Foreign Investment
In 2001, the government amended mining laws to encourage foreign direct investment in the mining sector. Their changes included abolishing government royalties, reducing the cost per hectare to hold mineral rights. In September 2007, Ecuadorian Mines Minister Galo Chiriboga announced that the country favors large-scale mining, and the government continues to cautiously encourage exploration.
MEXICO
In 2000, the election of president of Vicente Fox ended 72 years of authoritarian rule for Mexico. The new regime set the stage for dramatic economic modernization. In recent years the country has enjoyed significantly greater political freedom, along with relative economic and financial stability. Easier bank credit, together with a vast housebuilding programme promoted by the government, is slowly expanding Mexico's middle class. Social policies have helped to cut poverty.
New Administration
Following a tumultuous and controversial election in 2006, Mexico elected Felipe de Jesus Calderon Hinojosa to the presidency. Mr. Calderon has stated he will further reduce poverty and create more jobs. He will be helped by NAFTA, which has dramatically improved the country's northern economy. In fact trade with the US and Canada has tripled since NAFTA was implemented in 1994. The southern regions of Mexico, however, have not benefitted nearly as much---a problem Mr. Calderon has pledged to address.
Mining in Mexico
Mexico is growing increasingly attractive for mining and exploration, not only because of its political and financial stability, but also because the Mexican Geological Survey continues to improve the country's geological knowledge base and accessibility to it. In addition, updated mining regulations have completely opened the mining sector to foreign and domestic investment.
PERU
Peru is enjoying increasing political freedom and stability, along with a surging economy. The presidential election of 2006 saw the return of Alan Garcia who, after a disappointing presidential term from 1985 to 1990, returned to the presidency with promises to improve social conditions, maintain fiscal responsibility and continue implementing the investor-friendly policies of the past decade.
High Metals Prices Boosting the Economy
Thanks to high metals prices, the country is enjoying a period of relative prosperity. Peru's dependence on minerals and metals, however, means the economy is vulnerable to fluctuations in world prices. After several years of inconsistent economic performance, the Peruvian economy grew by more than 4% per year during the period 2002-06, with a stable exchange rate and low inflation. The US Congress recently approved a bilateral free trade agreement (FTA) with Peru, which is expected to further boost investment and exports.
Increasingly Pro-Mining
Due to Peru's relative political, social and economic stability, many of the world's top mining companies have made big investments in the country. Fortunately, the country's democratic government is seen as increasingly pro-mining. It has handed out concessions for exploration covering 12m hectares (45,000 square miles), which it hopes will trigger further investment of $11 billion over the next four years. Recent world-class discoveries and mines include Yanacocha, Pierina and Alto Chicama (gold) and Antamina (copper-zinc).
Q. Where are your samples analyzed?
We use a number of different analytical laboratories depending on which country we're working on and the kind of analyses we need. All samples from our Nicaraguan projects go to CAS's laboratory in Tegucigalpa in Honduras. CAS perform basic sample preparation and Fire Assay gold analyses. All ICP and check Fire Assay sample analyses are carried out at ACME Laboratories in Vancouver, Canada, as part of Radius's QA/QC sampling protocol. To this point, all of our Guatemalan samples have been forwarded to Inspectorate's lab in Nevada. You can follow these links for more information on the analytical companies. Columbia Analytical Services (CAS). ACME. Inspectorate.
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