CEO Blog

CEO Blog

Karl: We are filming this the day after PDAC so a little bit of a rest just maybe sleep.

Robin: Yeah.

Karl: So you are the president and CEO and director of Grid Metals Corp. How was PDAC for you?

Robin: As I always say 25,000 of your closest friends all in one spot, but the good news is there’s people from all over the world and a chance to connect with our shareholders and people in the business and you know companies that we want to do business with and yeah so it was great.

Karl: You were telling me a story about this gentleman that wants you to stop by in Portugal?

Robin: Yeah we have been approached by a lot of companies like lithium companies that are looking at finding supplies, supplies being concentrated and to be used in plants that make the precursor battery materials so like lithium hydroxide for example so that was an example of a Portuguese company that’s got a joint venture and they want to supply battery materials to Europe and so they’re here in PDAC and they were looking for junior companies that might produce lithium concentrates in the future.

Karl: Awesome. All right so let’s start with your experience, what I think you have a finance background.

Robin: I do. I did a Master’s degree at Dalhousie in Marketing and Finance and then I worked in the banking industry for 20 years and then got into the exploration business around 2000, so I’ve been doing it for 20 years now. I’ve been with Grid for a long time, I've worked for other companies as a director. I’ve done some consulting, so I have pretty varied experience in the business and so yeah it’s a very entrepreneurial and exciting business so I like it.

Karl: And the technical team?

Robin: The technical team is headed up by Dave Peck. Dave is a PhD, he’s worked for majors and smaller companies and he’s really a Nickel PGM guy. Carey Galeschuk is our VP exploration for lithium and Carey is an experienced lithium geologist and has worked for the Tanko mine in Manitoba. And then very importantly we have a local exploration team in southeast Manitoba, and most of the guys live there and commute into the site for the work they’re doing.

Karl: How much money is in the treasury right now?

Robin: We have got about 9 million in the treasury, you know we’re just finishing up our drilling program so when that’s done we will have about 8 million dollars and so we are going to get all our results from our drilling and then assess and look at what we are going to do next.

Karl: And the last financing you did that was with a strategic group out of Perth?

Robin: Yeah it was a group that’s headed up by an exempt dealer down in Perth called Churchill and they brought in a number of industry players including Primero Engineering which is a process engineer that means that they design plants and circuits for lithium and nickel, they are a large engineering firm. Then a private Equity group that operates some mines AMCI group and then some other investors from west Australia.

Karl: What valuation was that done at?

Robin: The stock was around 12 cents at the time and we raised 8.5 million dollars. Some of the money we did convert it to charity flow through so we raised it at 20 cents so we got a good premium on that yeah. But you know we’ve used that money, we're drilling off our resource in lithium so we’re just finishing that in the next week or so and we’ll have enough drill density to conduct initial resource on our lithium property which is exciting because we’ve done that in just over a year and if we don’t have the largest, we’ll have the second largest lithium resource in Manitoba. There are not that many juniors in Canada that have lithium resources so that’ll be a good milestone for us.

Karl: Cautionary forward-looking statements of course.

Robin: Yeah I mean I think we haven’t done it yet so there’s always the risk that something will go wrong but you know we’re pretty comfortable that that’s going to work out and you know we don’t know the size of the resource but we’ve been working with geological consultants along the way and you know it’s not our first resource so we’ll see where that comes in but you know we’re optimistic it’ll be a meaningful number.

Karl: One of my Key takeaways from PDAC was that lithium is the hottest space to be in right now in mining and I’d say nickel’s behind that. I personally love nickel myself. I know it’s very hard to find. There’s two tiers to it and I probably know more about nickel than I do lithium but lithium is you know Traders are trading these stocks right now.

Robin: I’m very confident we have a really good plan and we are looking at growing the business in a manner that it’ll really amount to something right. So that’s our focus and I think there’s lots of people following us and it’s like we need a bit of a catalyst to get going and i’ve seen the markets come and go and I think we’ll get over that sooner rather than later and you know we’re not going to the market to raise money right away and we are looking for people who have an investment horizon of years and not weeks.

Karl: So yeah you want someone that’s going to buy some shares and hold on to it?

Robin: That’s right yeah

Karl: Okay so when it comes to the 8 million that you have, I know you’re waiting on some results that’s going to play a big part in your go forward plan with that money but what do you already have in your plans to use that money for?

Robin: Well we’re gonna need to do the resource calculation, we are doing a resource calculation for our nickel as well as that’s hopefully coming in the number of weeks or months is you know that’s in the process but for the broad brush plans on our lithium business is that you want to calculate a resource, get a resource, and the way that we’re trying to get it differentiate ourselves is to get into production early by means of a toll Milling agreement with a company called Tanco so Canada’s only lithium producer is the Tanco Mine which is literally next door to us in Manitoba, and they are building a new Mill and they’ve stated that they need more ore from you know surrounding sources and so we’ve signed a memorandum of understanding with them. We are working out the details to supply them more so this means we don’t have to build our own plant. We will mine and put it through the processing plant and then we sell it into the market and split the profits. So that saves us number 1 time and number 2 the cost and capital cost of building a concentrate which is probably 150 to 200n million dollars or something like that and takes longer. So that’s our immediate plan and then to do that we need to get our project permitted so there’s a two step process for that and you know it’s not a lot of money but its time and effort for baseline environmental work which you have to go out and spend a year in the field and we’ve done that but we’re continuing to do more than the first permit is an advanced exploration permit and you know we’ve spent most of the money in that and actually were pretty close to being able to submit that to the Government so that’s our focus is to get a resource and a mining permit for that project and the timing you know we’re hoping we might actually get a mining permit sometime in 2024 which would be really fast.

Karl: So you would say Manitoba is a good province to work with when it comes to mining?

Robin: Yeah it’s good, I mean they’ve got a long history of mining in the province and there’s a gold permitting regime and we’re about an hour and a half from Winnipeg, it’s a good infrastructure. The key I think in my view is really to have the First Nations on side with you and supporting what you’re trying to do because that’s very important these days in Canada and is really key to getting your project permitted so you know that’s a priority for us.

Karl: Who’s on your staff that’s sort of connecting the two?

Robin: We all share in in it at a certain extent, you know we have a direct relationship with the band that we deal with is the Sagkeeng First Nation and so I deal with the Chief directly and some of our staff do and you know we have two of the members of the community that work for us full time at site so you know they have legal representation and we have our consultants so you know there’s lots of points of contact and you know the key is communication and keeping them posted on what we’re doing.

Karl: Okay awesome. Do you want to talk a little but about the structure of the deposit itself and the dikes?

Robin: Yeah so it’s two LCT dikes so very importantly they are spodumene which is a mineral that has up to 8% lithium and so these are basically vertical structures that are very continuous. They are around four-five meters true width and they’re high grade and we’ve drilled the one over a strike length of about 800 meters and down about 350 meters and the other is a little bit it’s 600 meters and we’ll drill that down to about the same depth and you know what we’re finding is when we’re in what I call the core area of these things we literally have not missed in any hole sometimes it’s narrower but it’s very continuous so that gives us confidence that you know we’re gonna be able to get a decent resource out of this and then in terms of mining like there could be some that would be open pit maybe a million in a half to two million tons we’re estimating, but you know to mine most of that it would have to be underground. What you want in underground mining is a vertical structure and continuous and that’s what we have. The rock that you’re mining is white and the surrounding rock is black so that’s another good key visual for when you’re mining and so we think these are going to become more videos and because of their nature they’ll be able to be mined underground so you know it’s a really good start for us and then we have quite a big land position and you know we’re expanding the search and are trying to find more of these pegmatite dikes that have lithium in them and there’s definitely a lot in the area.

Karl: When it comes to the infrastructure, how far off a road you got Hydro?

Robin: For the Donner Lake Lithium property there is a provincial highway until about 10 kilometers away and then the area was logged recently so there’s logging roads in so you can know. The last time I went out there I drove a rental car almost to the drill so it's pretty accessible. They haven’t got power in to the site yet but you know it’s fairly close so it’s not going to be a huge expense and you know it’s close enough to population centers that people can commute out there so you know people who work in Tanko a lot of them live in lactobank, lactobane which is the closest town, so there is kind of a mining community there so it’s really actually a site. There are some cottages on the Lakes about 5 kilometers away, I think there are 6 cabins there but basically there’s no people around so it’s a really good place for a project as you have good infrastructure and no people around you. You know in our case Tanko has certain rights to when we go to sell a product that they can buy it at the market rates, so if we sell ore they can buy ore or if we want to process it into a spodumene concentrate and we go to sell it, they have the right to buy that at a commercial market rates. If they don’t want it we can sell it to someone else but that is only on part of the property. What we are really seeing is a chain so you go ore, spodumene concentrate which is a precursor that goes into hydroxide which then goes into batteries and the batteries go into vehicles. So all the way down to the auto manufacturers, and that’s the primary use going forward for lithium. The various stages along the way are trying to get their hands on lithium spodumene concentrate, and that’s what’s in short supply right now and so we’re seeing inquiries from all levels and particularly the battery manufacturers who some of them are investing in these hydroxide conversion plants are really chemical plants. So you know they want to see you ok how long are you from being able to provide the product?, how much can you provide when that type of thing and so pretty much every project you’ve seen around the world that’s been developed there’s some kind of off-take agreement to finance it.

Karl: Yeah, yeah, okay and do you want to talk a little bit about the nickel?

Robin: Sure yeah, so you know the Makwa Mayville project we’ve got a national instrument 43101 resource there of about 40 million tons in two open pits and you know we think that the secret to that project is going to give expand the project so it’s bigger, that we can have a longer life and run it at a slightly larger run rate, so we are exploring. We’re doing a new resource calculation now and you know we are hopeful that we’ll expand it, we’re looking at some acquisitions in the area of more ground for more exploration there’s a couple of properties in the area that look like you know they could be good add-ons for us, so that’s our main plan is expand that project and get 200,000 tons of contained Nickel in it when our deposits also have copper and pgm’s and Cobalt. So you know we’re at a really good start, we have significant resources and we’ve done a lot of Metallurgy and that type of think so we’re using a very standard processing flotation which they’ve used in Canada for 100 years so you know its moderate grade, it’s not some bigger low-grade deposits and so this is kind of an in the middle type deposit. There’s a deposit in Scandinavia called the Kevitsa project which has been very very successful for a company and it’s a poly metallic, similar to what we have in terms of the grade and that’s kind of the model that we’re trying to emulate.

Karl: Are you over or just below 1%?

Robin: It’s below 1%. The Makwa is about 0.6% nickel plus some other credits and and the Mayville was a copper nickel so that nickel is 0.2% and the copper is 0.4 and there is PGMs in both of them. So we do it by NSR value so once you process it and sell it to the smelter, how much they pay you, and so the value in the end the net smelter return value is about 65 to 70 dollars on average for those two deposits which is not bad.

Karl: The nearest smelter is?

Robin: Probably Sudbury and Quebec for Copper.

Karl: Okay yeah so Sudbury is not too far?

Robin: Yeah the belt they produced there back in 1972 and they sent the Nickel concentrate to separate in when the price of nickel was $2.50 a pound.

Karl: This 8 million that you have in the bank, have you figured out how much you’re going to put towards the nickel versus lithium or are you waiting for more lithium data?

Robin: You know we’re going to get our resources back and we’re definitely going to do some more exploration on the nickel project. In fact when the drills finish in a couple weeks at our lithium project at Donner Lake, they’re just going to go up to the Mayville site which is literally a kilometer away and drill some holes there, yeah they’re right beside each other.

Karl: Okay, anything we haven’t discussed? Anything you would like to say to your current shareholders? Or leave off on for potential new shareholders?

Robin: Yeah you know I think there’s a lot of value in our company, we have a real solid plan to develop a business and we want to be one of the first movers in terms of getting into production in lithium which I think is really kind of differentiating for us and we’re really optimistic about you know the prospects going forward and there’s a lot of value in our company in terms of metal in the ground and you know we are optimistic that we can make some progress in the next year or two.

Karl: Well the prices are good right now so if you can get into production there’s a lot of money to be made?

Robin: Absolutely.

Karl: All right let’s leave it there my friend.

Robin: Thanks Carl

Karl: We’ll catch up with you in Europe or back home here in Canada but we wish you nothing but the best you know. Hopefully you get the results you’re looking to get back.

Robin: Thanks very much Karl.

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