On October 17, 2022 Grid Metals Corp. signed an MOU agreement ( the “Agreemnt”) with Tantalum Mining Corporation of Canada (“ Tanco”) Tanco is the only producer of lithium spodumene concentrate in Canada. The mine is located 165 km from Winnipeg and employs approximately 150 people.
The agreement covers a number of steps to be taken towards entering into a toll milling agreement. The objective is that ultimately ore from Grid’s Donner Lake Lithium Property would be mined and then trucked to the Tanco Mill and processed into a lithium concentrate product which would then be sold and the profits shared between Grid and Tanco.
Over the past year Grid has achieved excellent exploration results at the Donner Lake Property from drilling . Under the Tanco Agreement we will send drill core from our recent drilling to the Tanco mine for testing and following successful results we will complete a bulk sample and then formalize a toll milling arrangement. We will also continue with our exploration with initial plans to establish a maiden resource sometime in 2023.
The agreement with Tanco is mutually beneficial as it provides potential for early cash flow for Grid and additional mill feed for Tanco – a win- win
Permitting and consultation are required before a bulk sample or any production can occur from Donner Lake but we believe that there is potential that this may be achieved in a much shorter time frame than required to build a dedicated mill. ( which can easily cost several hundred million dollars ) As a first step towards production toll milling requires much less capital to achieve cash flow.
Lithium prices are currently at an all time high and the goal is to take advantage of the high prices to maximize early stage cash flow for Grid before prices revert to more moderate levels.
The lithium industry is in its infancy in North America with multiple projects under development but no production of lithium concentrates from hard rock mining occurs other than from the Tanco Mine. Projects that produce spodumene concentrate will have to be able to send their concentrate to an upgrading facility to produce lithium carbonate or lithium hydroxide. Considerable capital costs for these upgrading facilities are also required and will also take time to permit and build. But currently, Tanco spodumene concentrate is being shipped to China for upgrading at facilities there.
As a jurisdiction Manitoba has the potential to enable a low carbon footprint and social acceptance for mining activity. Ultimately, we believe Manitoba will become an important hub for production of battery metals - lithium included.
Grid also has a high potential portfolio of nickel-copper -PGM properties in Manitoba. We have a dedicated team and have just recently completed a strategic financing with sophisticated international investors experienced in the lithium and nickel exploration and development business. We have many exciting developments ahead and we invite you to follow our progress.
Thank you
