Profile A GEOLOGICAL PRODIGY Aur Resources President James Gill

“I have been involved in many, many deals over the years, most of them unsuccessful, and it took me a long time to learn that you bet on people, not ideas.” — Leo J. Thibodeau.

As he presides over the Aur Resources annual meeting in the plush surroundings of a Toronto Sheraton Hotel conference room, James Gill could easily be mistaken for a rookie college professor. With electric pointer in hand and audio/visual equipment to assist him, the 38-year-old president of one of Canada’s most promising exploration companies looks like a first-year geology instructor in full flight. Flanked by a supporting cast of Aur executives, he gives an off-the-cuff project overview that could grace any one of academia’s biggest lecture halls. The thick, red moustache twitches in consternation as he contemplates the dimensions of a new gold zone. But if the Aur annual meeting seems like a throwback to Science 101, there’s a reason. As far as Gill is concerned, the scholastic approach to exploration isn’t a sales pitch dredged up for the 150 or so geologists, analysts and shareholders who are scattered throughout the audience. Attention to detail and adherence to the principles of economic geology are the rules of thumb which have taken Aur from desktop flights of fancy to the threshold of Canada’s gold producing fraternity. A solid exploration strategy and a sure hand at raising funds for his company have also made Jim Gill a man to watch as Aur steps up to the plate as a Canadian gold mining company.

Just seven years after he left the relative security of an exploration job with Denison Mines, Gill is about to prove that 10 years in the academic corridors of McGill and Carleton universities, where he earned a doctorate in economic geology, was time well spent. With two Val d’Or, Que., properties — the First Canadian and Norlartic — nearing production and a promising new find at Bachelor Lake waiting in the wings, Gill promises a combined production rate of 40,000 oz gold by the end of this year. Meanwhile, the former squash fanatic and all-round athlete will attempt to confirm his ability as a geologist and project financier by accelerating Aur’s production rate to 100,000 oz annually by the early 1990s.

The son of a civil engineer, Gill grew up on Montreal’s west side and, after attending West Montreal High School, he opted to follow his famous grandfather, James Edward Gill, into the McGill University geology department. During an academic career spanning five decades, J. E. Gill carved out a reputation that any budding geologist would find hard to follow. As Dean of McGill’s geology department between 1959 and 1969 and consultant to federal and provincial governments, Gill defined the structural provinces of the Canadian Shield.

According to the University archives, the elder Gill is also credited with discovering a number of gold deposits in Labrador, Quebec and Peru and organizing the university’s masters program in mineral exploration. “His courses gave you much more exposure to the real world because you knew you weren’t taking lessons from one of those professors who were just one week ahead in the text book,” recalls Canamax Resources President John Hansuld, who studied under Gill in the late 1950s. The younger Gill acknowledges that his grandfather was a major influence. But there were other reasons for choosing to study geology. “I was interested in a career that wouldn’t tie me to a desk all the time,” explains Gill, who used his grandfather’s office to study for a degree in economic geology.

While he worked for a number of exploration companies during a 10- year university career, studying for a doctorate degree at Carleton University in Ottawa kept him in the classroom until 1977. However, he maintains that his university years have helped rather than hindered his progress in mining. “Compiling a thesis that was two inches thick imposes a discipline that other things may not,” said Gill. He chose to write on Texas Gulf’s Hood River massive sulphide deposit in the Northwest Territories.

The experience probably made him more rigorous in his approach to exploration, says Wayne Ewert who remembers his former Carleton colleague as a highly competitive athlete who gave squash lessons in his spare time. A manager of new projects with Consolidated Goldfield’s Canadian wing, Ewert says a PhD equips successful graduates with superior geological skills. “You certainly aren’t going to be fooled by anyone,” he says.

“I felt that if I didn’t complete the doctorate, it would restrict my flexibility and I wanted to leave all my options open,” says Gill, who managed to complete his thesis despite going through a divorce. He has since remarried, to Derryn, a Carleton graduate with a doctorate in reproductive physiology. The couple have two children. Upon graduating in late 1976, he worked for Getty Mines in the Northwest Territories and then as chief geologist for Denison Mines’ Eastern Canada exploration division. Since government regulations prevented Denison from repatriating the profits from a placer-gold project in the Cameroons, Gill was sent to survey the African nation for its mineral potential. But Denison failed to carry out any of Gill’s recommendations and he left just as then-chairman Stephen Roman was about to lay off 90% of his exploration staff.

“Why waste your time looking for mines on behalf of a big corporation when you could be doing it for yourself,” says Gill, who had already met the man who would set him up with his own company. A former owner of a Windsor, Ont., trucking company, Leo J. Thibodeau took what he considered to be a gamble when he offered Gill the financial backing to start a gold exploration company in 1981. The two had met while they were directors of a small oil and gas company called Atlas Yellowknife Resources. Impressed by Gill’s honesty and ability to put together deals, Thibodeau made him a generous offer over lunch at Toronto’s Royal York Hotel in Toronto. While Gill put up only 10% of the initial $500,000 in working capital, he was offered 50% of the company’s common stock.

“The shares were offered to him as an incentive to make the project go,” says Thibodeau, 65, who remains a director and major shareholder. Halifax resource magnate John Jodrey was the other contributor to Aur’s initial financing. After renting a room at the back of an apartment building in the area of Toronto’s Jane and Bloor Streets, Gill sat down with a mining directory and circled all the companies that were cash-rich but largely inactive. In September, 1981, after sending out letters to each company offering to do some consulting work, he got a call from Leo Brossard, president of Montreal-based Brominco Inc.

At that time, Brominco was Quebec’s second-largest exploration company, with more than 30,000 acres of gold prospects in the Val d’Or area. They included the 3-claim Norlartic property at Vassan Twp., which produced more than 1.1 million tons averaging 0.13 oz gold during the 1960s. It contained a 1,000-ft shaft and 861,000 tons grading 0.13 oz of drill-indicated reserves. “I went up to Montreal to ask Brossard if we could make a deal on some consulting work,” Gill recalls. Brossard, who studied under Gill’s grandfather, was 72 at the time, and he appeared reluctant to spend very much on the properties. “After taking a look at what he had, I told him that every one of them could use at least $500,000 in exploration financing,” Gill says. The two struck a deal in which Gill paid $25,000 for an option to buy Brossard’s controlling block of shares for $1.8 million. “Since Aur had only $375,000 in the bank, I didn’t sleep that night.” Gill spent the next year attempting to pull together the financing to exercise the option.

In the five years since Aur went public, Gill has assembled a formidable lineup of like-minded exploration and mining experts to help him turn the company into a successful mining concern. First on board was Howard Stockford. A former graduate of the Royal School of Mines in London, England, Stockford had 26 years of exploration under his belt, includi
ng almost a decade as Falconbridge Ltd.’s chief geologist for western Canada, before he was persuaded to join Aur.

“I’m not in the field as much as I used to be,” says Gill, who is delegating more authority to the Aur vice- president.”He picks up the slack as I have to spend more time doing other things.” After 21 years at Falconbridge, including a stint as exploration manager for Corporation Falconbridge Copper’s (now Minnova Inc.’s) Eastern Canada division, Barry Simmons was brought in to head up an Aur affiliate, Syngold Exploration. The company was revived in 1986 to develop some properties — Owl Creek in northeastern Ontario and Deka in northwestern Quebec. Last year, Gill persuaded his old pal John Heslop to leave the Falconbridge fold and join the growing Aur group as head of a new affiliate company called International Thunderwood Resources. A former exploration director with Falconbridge and Kidd Creek Mines, Heslop left Carleton to join Texas Gulf before he had completed his thesis.

While the three consider themselves partners rather than employees of the Aur president, they share the same approach to the business of mining. “Through sound technical exploration, we want to become commercially successful as soon as possible,” explains Simmons. “We only take on properties which have an excellent discovery potential because there is no point in taking on a property if you are going to abandon it in six months.”

“You can’t find mines if you don’t drill” is a phrase that is often bandied around in Aur’s Adelaide offices. “If a property isn’t worth at least 30,000 to 50,000 ft of diamond drilling, it isn’t worth bothering with,” explains Gill, who credits his company’s success to an exploration strategy emphasizing a systematic, step-by-step approach involving drilling, drilling and more drilling.

The fact that he is about to realize his ambitions comes as no surprise to any of the contemporaries and business associates who have monitored his progress over the past 20 years. “Jim is one of the few people who managed to successfully apply his academic skills in a practical business setting,” says Ewert, who completed his doctorate in metamorphic petrology a year ahead of Gill. Ewert and his wife Cathy were two of a small group of friends who played squash and intramural hockey together during their free time. The others included John Heslop, Mike Cecile (Research Scientist, Institute of Sedimentary and Petroleum Geology, Geological Survey of Canada), Richard Moore (Regional Exploration Manager, Falconbridge Ltd.) and Ian Hutchins (Associate Professor of Geology, University of Calgary).

“Everything he did had a practical focus and you could never see him ending up in an academic field,” said Ewert. “He is a master of understatement and one of the best young minds in Canadian mining,” says Thibodeau, who considers himself lucky to have “hooked up” with the Aur President. “I just felt that he was going to be successful.” TSE Review