New Age Metals (TSX-V:NAM, OTCQB:NMTLF) (NAM) is an exploration company with 'two divisions' but 'one green' agenda.
It has a platinum group metals (PGM) division and a lithium unit, both of which clearly have great potential in the clean energy market.
Renowned resource investor Eric Sprott owns 24.5% of shares, while CEO Harry Barr founded International Metals Group and has over four decades' experience in the mining industry. Director Colin Bird also has over 40 years' experience of financing, operating and managing many mines, including nickel and coal.
New Age Metals' flagship River Valley palladium project in Ontario covers 107 square kilometres (sq km) and is advancing towards a pre-feasibility study (PFS), earmarked to be completed in the fourth quarter. It already boasts a resource of 2.25 million ounces (Moz) of palladium, platinum and gold in the measured and indicated (M&I) category.
The firm's lithium division is the largest claim holder in the Winnipeg River pegmatite field in Manitoba and, notably, exploration is being funded by Mineral Resources Limited (MRL) - the fifth-largest lithium producer in the world.
Proactive recently caught up with New Age Metals CEO Harry Barr to find out more.
PROACTIVE: Can you tell us about the River Valley project and what excites you about it?
Harry Barr: Well, several things. It's one of North America's largest undeveloped PGM deposits. As you know, platinum group metal (PGM) deposits are very rare and scarce in North America so that's very exciting. It's location is exceptional. It's only 100 road kilometres (km) from Sudbury, which is really the biggest mining centre in Canada. So everything we need for a junior mining company, from exploration drills, to labs to metallurgical companies, environmental companies, engineering companies - they're all right there. There's also a great supply of experienced geologists and engineers and Sudbury hosts one of our best mining universities.
Most importantly, Sudbury’s two major companies produce PGMs as a by-product to their nickel and copper and have extra capacity. So there is a very immediate source to send our concentrates to get our PGMs and our other metals out. Proof of their extra capacity is Canada’s current only standalone producer of PGMs - the Lac Des Iles mine up in Thunder Bay - has successfully shipped its concentrates over 800 km for over 22 years to Sudbury and continues to do so
You are focused on energy metals. Can you tell us more about palladium? What it's used for and how you see the outlook for the metal?
Well, 85% of palladium in the world is used in auto catalysts which is an anti-pollution device for cars, trucks and buses and boats and whatever needs catalytic converters. That will go on for a long time. There's also going to be more use too in hydrogen and hydrogen automobiles and buses. So that is one of the newer uses coming up. It has other industrial uses, too.
Every couple of years countries up their environmental codes and that adds more and more loading of the PGMs to the auto catalysts to make them more efficient as an anti-pollution device. So instead of using less palladium over the years to come, more will be used. Russia is the major producer of palladium but with recent sanctions from Canada, the US and Europe having a large palladium asset in North America has become extremely important
Can you explain the deal with Mineral Resources Limited (MRL) on your lithium assets in Manitoba. How is it structured and what does it mean for New Age Metals?
Initially, they have to pay us $400,000 with $100,000 a year over four years in cash and spend $4 million over 42 months to earn 51%. We are the field manager so New Age management and our consultants are doing the work on the project. We receive a fee for doing our work. This year's $1.6 million budget will be the largest our Lithium Divison has ever seen.
Can you see your lithium portfolio overtaking River Valley in terms of significance or do they both run alongside each other?
It is early days for the lithum divison in terms of us blocking out a decent reserve and really getting on our way to making a mine. There's a lot of exploration to be done. Having said that, the average investor who comes into the company might come in solely because of the lithium division. If that is in fact the case I like to remind them that they also get the PGM division for the same investment
You use the project generator model. Why is that significant? What are the benefits of being a project generator?
The deal (with MRL) is my 44th that I have done with major mining companies. Majors are always a big funding source for juniors. It (project generation) allows our company to have more than one project or division going on at once. You are diluting your interest in the project but not diluting your interest in the shares. So for us our main focus was the River Valley project. We are funding that by selling our shares and raising money through the public and we're fully funded to complete a pre-feasibility study there but it's always been our stated objective to find a good partner that understands the lithium industry and we're lucky to bring in MRL, the fifth largest producer in the world as a partner.
What news flow can investors expect from the company in the near to mid-term?
Near to mid-term there will be updates on our pre-feasibility study. We hope to have a final version of the whole study by the end of September. There will be updates on various exploration activities. For example, in the lithium division, we plan to drill at least two projects. We're doing a lot of fieldwork. We're following up on the geophysics that was done last year with boots on the ground and geologists looking at the anomalies that were identified via $300,000 of geophysics we did last year.
The objective of that program is to come up with some new drill targets outside of the two projects that we're drilling on now - we have seven altogether. There will be some news on new acquisitions throughout the year. We're hoping to find a partner on our Alaskan Genesis property this year. So there will be updates on that. We also have some exploration planned for River Valley over and above working on the pre-feasibility.
What do you bring as CEO to the company?
Good question! Well a lot of experience. I am 67 now and I've been in the business since my early twenties. I basically ran a group of companies, all of which are running today. Over time, I brought other people in to run my Freegold and CanAlaska Uranium, etc. I have made a lot of deals with major mining companies and raised over $300 million in equity for different projects and worked in nine different countries. I think I have attracted a very good board of directors at New Age. They are all veteran engineers and geologists who have extensive experience in all aspects of the business that we're working in.
Contact the writer at giles@proactiveinvestors.com