Saturday 26th September 2020

Resource Clips

Strategies for success

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Costigan outlined Electra’s three-part strategy. The company already produces revenue from its chalky geyserite (aluminum silica) quarry on Vancouver Island. Secondly, the company’s new acquisitions offer potentially very low capex to produce jade, including B-grade jade for neglected industrial applications like table tops, ball bearings and brake pads.

Thirdly, Electra is “the only public company in the jade mining business and that excites Chinese investors, and they’re clamouring to get in.”

Lakeland raised “a little north of $5.1 million, the third-largest amount raised in the Basin last year,” said Leschuk. “We look to spend that money efficiently and effectively. Going into the summertime, we have four projects to work on. That entire budget is $800,000 so we’re always looking 18 to 24 months ahead and we want to manage our money wisely.”

We got sniffs of uranium so we’ll do more ground work during the summer and announce our next drill program. We know there’s uranium up there, we just need to go and find it.—Roger Leschuk, manager of corporate communications for Lakeland Resources

A case in point: Lakeland initially set out to drill 1,500 metres on its Star/Gibbon’s Creek Phase I program. But the company ended up sinking 2,500 metres “and still came in under budget,” Leschuk emphasized. “We got sniffs of uranium so we’ll do more ground work during the summer and announce our next drill program. We know there’s uranium up there, we just need to go and find it.”

Acknowledging that “capital is the lifeblood” of junior explorers, Hardy reiterated Equitas’ commitment to work cost-effectively. “At this point we are anticipating a summer drill program and ground-based geophysics. But having said that, the capital we do take in, it’s absolutely critical that it gets deployed efficiently and effectively … to advance the project as forward as we can for as few dollars as possible.”

Having previously been an exploration contractor, Hardy has experience passing on cost-saving measures to clients. He brings the same experience to Equitas, “directing capital at the targets that get us and our shareholders the biggest increase in value that we possibly can.”

What about optionality, Berry asked. What do these companies have as a hedge?

Tantalum, responded Grove. Commerce’s Blue River project in B.C. is potentially “the largest production scenario in the world for tantalum right now” and “would be a completely conflict-free producer.” In March Commerce filed an updated 43-101 technical report for Blue River, which achieved a preliminary economic assessment in 2011.

As for Ashram, the rare earths project also offers fluorite. “We would already have the potential of being the lowest-cost producer outside of China, then there’s this addition of the fluorite byproduct,” Grove said.

Costigan pointed to Electra’s industrial minerals properties, such as the chalky geyserite operation that brought $1.2 million in revenues last year. But getting back to jade, he said, “There’s an emotional attachment and a spiritual connection that goes back 6,000 years in Chinese cultural history, and that is a powerful, powerful motivator.”

Lakeland spreads its optionality through 32 properties totalling over 300,000 hectares, one of the Basin-region’s largest portfolios. Four projects have been prioritized for advancement, three of them drill-ready. Among other opportunities, that suggests joint venture potential. “If people want to partner with us, we’ll have plenty of opportunities to join us,” Leschuk said.

Equitas sees similar potential. “We’re very much focused on bringing a partner in to take [Garland] to the end game,” Hardy explained. “We’re not mine builders, we’re junior exploration. We’re good at what we do. You hand it over to the big guys when it’s time to move forward, then go on and find the next one.”

Disclaimer: Zimtu Capital Corp, Commerce Resources Corp and Lakeland Resources Inc are clients of OnPage Media Corp, the publisher of The principals of OnPage Media may hold shares in those companies.

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