I'm Charlotte McCloud with the Investing News Network and this is Measured and Indicated, an executive interview series we're producing in partnership with the New York Stock Exchange. We're at the Precious Metals Summit in Beaver Creek, and here today with me is Paul Hewitt, Chairman and CEO of America's Gold and Silver. Thank you so much for being here. Great to have you.
It's great to be here, Charlotte. It's great.
Really good to be speaking with you. Excited to have you here and since it's our first time speaking, I thought I could start with a little bit of a broad question, which is, where would you place us in the cycle for silver today?
Yeah, look, um, from where we're sitting, silver's at a very early start of the bull cycle. We've seen silver rally quite a bit. And it leads into that that big question is, is silver a precious metal or is it an industrial metal? Um, and the reality has changed a lot. It's shifted. And it's one of the number one questions I get asked every show I go to. And realistically, it's still a precious metal. It's still used to hedge against currency and everything.
However, it's changed so much in the last even 10 years with the amount of industrial needs we have. Every year, Charlotte, we're using silver, we're consuming it at over a billion ounces per year. We're producing even with recycled silver, we're producing about 850 million. So, we're short about 250 to 300 million ounces year after year and that's been five years in a row. That can't continue.
With AI growing, with um, battery stuff, with anything your cell phones, anything we have electronic now has silver in it. We're not slowing down. It's only increasing. You look at the electrification with solar, um while they're using less per per unit, they're adding a lot more units. So, with the industrial demands that we see in front of us, it has grown so much and as far as we're concerned, we're at the very tip beginning of a silver cycle.
Right. So it's precious, it's industrial, it's also now being recognized as critical, which I think is also pretty significant.
Very, very true, actually. Yeah, it's it's been identified as a critical metal along with four other metals that we have. We have, we have silver, copper, antimony, lead, and gold. So all five of our metals that we produce in Idaho are critical metals. You're absolutely correct.
Well, and let's talk a little bit more about silver. So, very exciting start to the year for the silver price. We've come down a little bit from those all-time highs. I wonder for you, if we look realistically, what's the path forward from the price? I know you said we're pretty early still.
Yeah, look, even at these prices, we enjoy these prices. We're not upset by any means. Anything over $50 an ounce silver, those are those are good numbers to have. So, as we continue to unlock the value in the ground, the thing that we remember the most is and for our shareholders, we have over 200 to 250 million ounces in the ground. So as the price does shift like we're expecting, those ounces are in the ground. They're in a vault.
As we continue to mine them in Idaho or mine them in Mexico, you're going to see we'll we'll we'll get higher prices for them. So we're quite excited about it. We think about it as as you're investing in America's gold and silver, um, the ounces are there forever until we mine them. And as we're mining them, and I'm looking forward to mining them in six months when silver could be at $100 an ounce. Um, who knows where it goes.
As I said earlier, I think it's very early in this game.
Well, and let's take a look at what's going on at America's Gold and Silver right now. So it looks like a lot of progress at the Galena complex in Idaho. That came to the company at the end of 2024 via a transaction with Eric Sprott. So you've been working to revitalize it, bring it into the fold, recently completed number three shaft modernization. So, let's talk about how that positions you for the next phase of growth.
Yeah, thank you. Look, Charlotte, there's no doubt that mine has been around for about 100 years. And buying out Eric Sprot's position was tremendous. Actually, we worked together with Eric to to acquire his 40% and then later on Eric converted some of his debt equity. So the reality is we have done a lot of new infrastructure. The shaft was just the tip of the iceberg.
That was the number one thing we had to do. We've changed the mining method. We've went from an old conventional handheld drilling mining method to a long-hole mining method. And our neighbors next door are enjoying long-hole already. So it's not something that can't be done. We've already demonstrated we could do several of them. We've done 19 panels, 19 long-hole panels. We brought in new equipment, uh new remote mucker. We've put in a brand new backbone system, new uh leaky feeders, we put in new fiber optics, all these things that require a mind to be modernized, to communicate properly, for the shaft to go up and down, to move them the rock inside the mine. In order to move the ore or the waste, we need a proper muck flow system and we didn't have proper rock breakers or grizzly, Grizzlies are in ahead of the loading pockets. All these systems had to be updated in order for us to get to that 1,000, 1,200 tons a day, so that we could get to 5 million ounces per year. Our mine did do 5 million ounces of silver in 2002. There's no doubt, we're heading back there and we're getting there quickly.
So, a lot of work going on there. We also definitely want to talk about the antimony angle at Galena. So, Antimony, it's become a pretty hot topic as critical minerals continue to gain traction, but I think for investors, maybe it's a tricky market to understand. So, I want to ask you to talk about how what it's used for, how much does the US need and to what extent you're contributing to that demand.
Yeah, so look, I've got the advantage of having one of these Antimony bars with me here, Charlotte. Um this thing is 99.98% antimony. It's produced by us, USAS. This is right from our mine and our partners, US Antimony. So together with our partners, this is what we produce. At the moment, we're one of the only producers in the US producing it. There will be others coming online, but the truth is we need them all anyhow.
Um the US consumes about 50 million pounds of antimony. We need another 40 million pounds for our allies. We haven't been producing antimony domestically for a very long time. It's been coming in from China. We've been relying on other countries for decades now. We've come to a stand still where we've been cut off from other sources. So it is such a critical metal. I've been to the White House twice now. There's no doubt that antimony is it's more than just a hot topic. It is something that together with other companies, we need to find a solution to. The advantage is we're so much further ahead because we're in production. Every ton of ore that we produce that has silver, also has antimony. So when we mine our antimony, we're we're targeting our or zones in silver. We mined it up our shaft. We produced the concentrate. The antimony is in it already. What we haven't been in the past, we haven't been properly rewarded for it. We haven't been paid for it. In the fact, before we got here, Antimony used to be a penalty for us. So as we used to treat our concentrates, it was a penalty. That's no longer a penalty. We're we've been in discussions with obviously people with the government, um our partners at US Antimony. We're very excited about what Antimony can bring to us and to our shareholders because for us it's almost no cost. It's it's a free margin. So um the margins are very sorry, not a free margin. It's a very high margin product for us as we continue to unlock it and build the new plant that we're considering to build.
Yeah, it's so interesting how it can go from being a penalty to something that is so so needed today.
You're absolutely Well, it's always been needed. We've just relied on others for it. So, in our case, it was a penalty, but we've just relied on other countries and you can't rely on especially when it's such a critical metal in our military. You think about how every bullet, every missile, but more importantly, when you think about I I live in Reno, Nevada, we've just had some huge, huge fires. Uh 50% of my workforce uh were evacuated.
So, one of the biggest second uses for antimony is for a fire retard. So when you look at the forest fires all over the US and you think about fighting fires, Antimony is a very critical metal that we need. So, us producing it already, sending it in um is very helpful.
Yeah, very, very significant. And I want to go back to the antimony processing facility that you mentioned. So, I believe that's a that's a partnership with US United States Antimony. So, what stage is that at right now?
So, we've done a lot of progress with them. We've got some technology that is specific to our own tetrahedrate. We're very excited about it. Um we've we've went to a plant together with our partners in Bolivia to see one actually in action. We flew there with a technical team, their technical team, and we've got to witness an antimony facility up there. We're going to reproduce one, but one more modern here in the US with our partners.
Um right now, our technical work is done, our permitting is far advanced, like about 95%. At this stage, we've gone out for tenders for for companies to bid at building this this new infrastructure that would be based in Idaho.
And also related to Galena, you've got the past producing Crescent Silver mine. So that was acquired this past December. You've been drilling over the course of the year. So what are the goals and results you've seen so far?
Yeah, so Crescent is going to become a big part of our story as well. So we've got Galena Shaft, we've got the core shaft, we've got the Callady shaft. So we've had three shafts over there. Over at Crescent, we have three ads. So, the advantage we have over there is there's been a lot of infrastructure there already. Excuse me, Charlotte. Um we're taking advantage of that infrastructure. We've added drills. In fact, we just put out some drill program, some drill intercepts.
Uh we hit 1.3 m of 1900 gram. That's extremely high grade. Um it's narrow 1.3 m, but we've proven we could mine as low as 1 meter wide. So, for us, we're very excited. Crescent is going to come more into the picture in second half of 2027 after we complete a secondary egress. We we need to put in some waste development and have a secondary egress into the mine so that miners can evacuate in the event of any kind of fire or anything.
Um that secondary egress doesn't exist yet. We've we've been in installing waste development now. We've been excavating at the moment so that we can get that ready for next year.
Anything further you would add on the note of drill results? I know you were talking before we turned the camera on there's been some excitement there.
Right. There has. Look, at all three of our projects. So when we look at, we'll start at Galena first. Uh Galena we've had six new discoveries in in the last 12 months. Six new discoveries. That's these are over and above the ounces. And and I'll just pick one. I'll pick the O 34 vein. We discovered that about 12 months ago, Charlotte. We started off with a million ounces. We added some drilling. We went to 3 million. We are we went to 7 million. We're over, we expect that we estimate it to be 8 to 10 million ounces.
What's important about it is that we discovered that about a year ago. But we've finally we're in it now. We're actually mining it. So from a discovery hole to actually mining, we're actually the first rounds out of that ore came out um last week. Actually, we had an analyst site visit and we were drilling and blasting that. That O-34 vein was 3.4 m. That's three times wider. So 3.4 m of 983 gram.
So our average grade is around 450 g. That's about double the grade, triple the width. So we're very excited about some of these new discoveries. They're wider, they're um better grades. And one of the reasons why we're having so much luck with the drill bit is because in the past our company didn't have enough money to drill. So now that we have a strong balance sheet, we're able to drill at all our sites. So that's uh Galena.
Mexico last year was a record for us. Uh we were we we delivered about we produced 1.1 million ounces and they're not silver equivalent. They're always silver ounces. Mexico was a record last year. This year in 2026, we will beat last year's record. And we're certainly with the drill results we've had for setting up for next year, we will beat that record again. So Mexico continues to deliver consistently. It's kind of like on autopilot. We go down there often.
We've bought new equipment down there. We have new scoops, new trucks, new jumbos, new bolters, and that's helping us become a lot more efficient. And we're adding another ball mill there. So Mexico will just become a larger and bigger part of our story. And and the ounces in Mexico are even 10 to 15% cheaper than what we see in Iho. So we're quite excited about where the future is for Mexico. There's certainly it's bigger than we had originally anticipated. So we're looking forward to it.
All right. Nice to hear about all the operations. And this is a little bit of a different note, but you've done work this year to end silver and gold delivery agreements. So, can you weigh in on the strategy there and the impact?
Yeah, look, that was a big one. So in Q2, uh we had some silver uh some gold streams and silver streams, a silver stream with Eric Sprot and then a gold stream with another royalty company. We've eliminated those. We were paying this was a a heavy burden on our balance sheet. We were paying about $20 million annually just in interest payments. So you think about not even principal, $5 million a quarter in interest, that's a lot of money. We could redeploy that to the drill bit or new equipment or new shafts, a lot of things. So we've eliminated that. That was to the tune about $80 million. So far, since we've been here for the 18 months, we've eliminated those two which were about 80 million and another 40 to 50 million. So we're talking 120 to 130 million of debt that we've eliminated to strengthen our balance sheet. It's the strongest it's ever been.
Well, that's great to hear. And I think we're coming to the end here, but before I let you go, I want to ask if there's any final thoughts that you would leave investors with about the silver market, critical minerals, the company, final thoughts.
Yeah, look, um America's gold and silver is an American company. We're USAS. We're very proud of it. We're domestically produced. We have a lot of American workers. Everything we're doing is is domestic. But more importantly, I think when you look at our company, a lot of people look in the rear view and they say, well, it's struggled for some time. It did. However, it's in a position now that it never has been. We are now heading into a growth mode coupled with the fact that silver is at high high prices that we're going to surprise a lot of people. So stay tuned.
All right. Well, lots to watch moving forward. Thank you so much for coming on to share today about the company and the markets. This was great.
It's a pleasure. Thank you for having me.
Of course. And once again, I'm Charlotte McCloud with the Investing News Network and this is Paul Hewitt with America's Gold and Silver.
