Critical Resources Ltd (ASX:CRR)'s name does what it says on the tin.
The emerging base metals explorer rebranded at the start of last year and has since trained its focus on some of the important base and critical minerals of the moment.
“The name change was a play on words, and a recognition that we wanted to expose ourselves to the critical minerals base,” says managing director Alex Biggs.
These are the materials – lithium, zinc, copper, lead – that will go into the technologies needed in a changing climate, such as electric vehicles, photovoltaics, light-emitting diodes and energy storage.
Some of these critical commodities have seen unprecedented jumps in prices in recent years. Lithium stocks soared by 400 to 500% in 2021, on the back of demand from battery manufacturers and slowing production attributable in part to COVID-19 and in part to shrinking supply. Some estimates suggest that the global supply will be exhausted by 2040.
CRR, reading the moment, has moved into this space with a suite of key assets – a promising base metals deposit at Halls Peak in NSW, two Canadian lithium projects that are set to coalesce into a lithium hub in Ontario and a well-performing legacy copper project in Oman.
Domestic base metal focus
The Hall’s Peak Project has the potential to become a large base-metal deposit, which CRR is keen to drill.
Airborne electromagnetic surveys have observed anomalies at the project that are consistent with potential massive sulphide deposits and large zinc-copper-lead-silver bearing beds.
“There hasn’t been much recent exploration done at Hall’s Peak, though there was a lot of previous mining dating back 100 years,” says Biggs.
“We’re targeting a large SEDEX (sedimentary exhalative or zinc-lead) deposit – our exploration is yielding some excellent results, as can be seen from our recent announcements related to our current drilling campaign at the project.”
Canadian lithium assets
During a busy 2021, the company added lithium to its suite of assets following a capital raise.
“We ended up picking up the Mavis Lake lithium asset in Canada towards the end of last year,” Biggs says. “And we’ve since acquired the Graphic Lake lithium asset, which is also in Ontario, 180 kilometres from Mavis Lake.
“The point is to build a lithium hub over in Canada to complement a really solid base metals asset (Hall’s Peak) in NSW, which we think is going to be transformational for the business.”
The company sees its pivot to lithium as a key plank of future success, with strong demand from the battery and EV sectors.
“Lithium is going to be very important going forward as the green revolution compels us to pick up these new technologies and move away from combustion engine cars and coal-and-oil-fired power stations," the MD said.
“Governments are leading this change and there’s no going back.
“We’re moving to a more sustainable future and lithium is a big part of that, as is copper, as is zinc, as is nickel – and the supply side has been impacted for all of those commodities.”
Biggs acknowledges the role of COVID-19 in the slowing of project development and capital expenditure, with knock on effects for supply.
"The couple of years we’ve had with COVID-19 are going to impact project development timelines, which in turn means that supply is short, and prices remain high.”
Strong growth
During Biggs’ tenure, the company has undergone a considerable period of growth and expansion.
“We’ve got three really strong assets that we see as somewhat de-risked because we know there’s mineralisation there – we know they’re good projects,” he says.
"We’re now in a good position to put together some resources, with upcoming drill programs both in Canada and Australia.
“The share price has gone pretty well the last few months – when we started we were sitting around the $25 million market cap and today we’re sitting around $140-150 million.
“It’s been a good year, and it’s merely the start for us. I think we can really push the company along this year.”
An ESG focus
CRR is now in the process of embedding ESG across its operations. Its website announces that it "intends to play a pivotal role in addressing environmental concerns while maximising economic return”.
The company’s stated vision is to address the decarbonisation of the global economy by sourcing and producing minerals critical to the building of sustainable technologies.
“We’re committed to developing a clear ESG strategy which supports the way we do business and we’re starting that right now," says Biggs.
“It would be kind of ironic if you’re a company dealing in critical resources and green energy if you’re not doing it as sustainably as possible.
“It's not optional."