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MGX Minerals Inc.: THE INVESTMENT CASE
INVESTMENT OVERVIEW

MGX Minerals primed for tomorrow's energy revolution with irons in many fires

MGX has a three pronged approach to its strategy and growth; commodities, processes and mass storage
MGX Minerals primed for tomorrow's energy revolution with irons in many fires
INVESTMENT OVERVIEW: XMG The Big Picture
Among the arenas MGX works in is lithium

In May this year the boss of materials and metals firm MGX Minerals Inc (CSE:XMG, OTCQB:MGXMF) said the energy industry was the "place to be right now".

"I think it's massive," Jared Lazerson told a podcast interview.

In the discussion, the CEO talked magnesium, lithium, and new methods for extracting minerals from brines and says there is a transition to renewables from fossil fuels, but this will take many years.

"Our approach to the industry is three pronged; commodities, processes and mass storage," he noted.

Lots of thumbs and lots of pies

That's true enough. MGX has a lot of activities on the go and is involved in many projects which would fit under that umbrella. Here is a run-down of the major ones.

MGX owns the largest new magnesium deposit in North America - Driftwood Creek in British Columbia. It has also acquired a mass storage facility that uses fuel-cell type batteries.

It also excitingly owns 2mln acres of lithium brine exploration property

Lithium

Starting with the latter, lithium, a buzz commodity at the moment, the firm has had a lot of newsflow surrounding the metal recently.

It is now set for drilling at the Kibby Basin lithium brine property in the Great  Basin of Nevada and has hired contractor Harris Exploration for the work.

Kibby Basin covers 2,560 acres in Esmeralda County, Nevada and the firm are partnered on the project with Belmont Resources (CVE: BEA) and is currently earning a 50% interest for the purpose of forming a 50:50 joint venture, using MGX's rapid lithium extraction technology.

MGX with partner Purlucid has developed the technology, which reduces costs and enhances the quality of extraction across a complex range of brines.

This technology is applicable to petrolithium (oil and gas wastewater), natural brine, and other brine sources such as lithium-rich mine and industrial plant wastewater.

MGX also has oil and gas rights acreage at the Paradox basin pretrolithium project in Utah, where a proposed 3D seismic geophysical survey is due to kick off in August and will include around 9,000 data point.

And just this week, MGX told investors it was set to acquire 80% of the Salinitas lithium project in Argentina - striking an option agreement with A.I.S. Resources Ltd over the claims, which lies in the lithium triangle of the  Puna region at the Salar de Salinas Grandes.

The 4,308 hectare (Ha) contiguous land package lies in an area renowned for its lithium-and potassium-rich brine resources.

Also in terms of lithium assets, MGX has a 20% working interest in five lithium hard rock properties in Ontario, including Case Lake,  controlled by Power, as well as any additional properties acquired by the firm before August 2020.

The lithium market is a buoyant one currently. Analysts reckon that the lithium juniors of today (like this one) won't be in production until around the mid 2020s, which is when the electric vehicle [EV] and energy storage markets should really be booming. Lithium-ion batteries are a major component in electric cars.

Prices are also holding their own too and higher than last year with lithium carbonate equivalent [LCE] contract prices around US$16,000 per tonne -  up about 20% on last year.

Energy storage

Elsewhere in energy metals, MGX's subsidiary - ZincNyx Energy Solutions - has developed a modular storage system using zinc and air to store energy, which has none of the traditional high cost battery commodities such as lithium, vanadium or cobalt.

Last month,  ZincNyx said it had completed the design for manufacturing of its core regenerator and fuel cell modules. It has a portfolio of 20 granted patents and is now ready to start commercializing the product.

Magnesium

MGX recently hired engineer Hatch Ltd to conduct a review and multi-phased work program at Driftwood Creek, aiming to prepare an NI 43-101 pre-feasibility study.

Magnesium oxide, or magnesia, is a widely used industrial mineral that comes in various forms. End uses include fertilizer, animal feed, and environmental water treatment as well as industrial applications, mainly in the steel industry.

An earlier positive PEA (preliminary economic assessment) on the project has shown a pre-tax NPV (net present value) at 5% discount of C$529.8mln with an IRR (internal rate of return) of 24.5% with a 3.5-year payback.

A geotechnical drill program has also just been completed, which shows the mineralisation could be expanded.

And silicon

The company recently said it had completed a summer drill program at the Koot silicon project in British Columbia ahead of a potential resource estimate.

A total of 782 meters (2,565 feet) of diamond drilling was completed across ten holes and core has been sent to the lab. The company also noted it was also planning work at its two nearby silicon properties, also with a view to defining an NI 43 101 resource.

Metallurgy is also underway at Dofner ANZAPLAN, a leading silicon metal metallurgy and process engineering firm.

The purpose of that work is to generate standard silicon metal (95-96% Si) and potentially solar grade silicon metal (99.9999%) process design options for feedstock from the firm's silicon projects.

So MGX has many irons in many fires, in an energy metals and resources environment, which has huge potential.

Shares in Toronto stand at C$0.89.

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