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Why PMET Could Be One of North America’s Biggest Lithium Re-Rating Stories · Kitco MINING

• 0:00
  SPEAKER_00: Is PMET Resource the most undervalued lithium powerhouse in North America with a newly filed ESIA and a potential$4 billion valuation gap?
• 0:09
  SPEAKER_00: We're breaking down the numbers today.
• 0:17
  SPEAKER_00: Welcome back to Kitco Mining.
• 0:19
  SPEAKER_00: I'm Jeremy Stafford.
• 0:34
  SPEAKER_00: This obviously moves that story beyond discovery and deeper into the formal mine authorization process.
• 0:40
  SPEAKER_00: Now the timing matters.
• 0:41
  SPEAKER_00: PMET's 2025 feasibility study outlined a base case to after tax NPV of roughly$1.6 billion Canadian dollars on a lithium-only basis.
• 0:51
  SPEAKER_00: Since then, lithium markets have strengthened materially from last year's lows.
• 0:55
  SPEAKER_00: And with spotomy prices today trading as high as$2,500 a ton, it raises the question of how much more upside the market is still not fully pricing in.
• 1:05
  SPEAKER_00: Add that, uh strategic stake from Volkswagen, a long-term off-take agreement, and future byproduct potential from tantalum to cesium.
• 1:13
  SPEAKER_00: The investment case is becoming harder to ignore here.
• 1:16
  SPEAKER_00: Joining us to discuss the timeline, the economics, and of course the path forward is CEO and president of PMED Resources, Ken Bridston.
• 1:23
  SPEAKER_00: Ken, thank you for joining us right now.
• 1:26
  SPEAKER_01: Pleasure to be with you, Jeremy.
• 1:27
  SPEAKER_01: Thanks for the chance to meet.
• 1:31
  SPEAKER_00: I mean, today is uh a big one.
• 1:33
  SPEAKER_00: You officially filed that ESIA with both federal and provincial governments, and you called this your most significant uh, you know, permitting milestone to date uh for investors kind of watching the clock.
• 1:45
  SPEAKER_00: I mean, why does this filing meaningfully change the risk profile for uh for Shakychuawan?
• 1:53
  SPEAKER_01: Oh, Jeremy, it's just the culmination of so much work by the team and our consultants that contribute to the project.
• 2:00
  SPEAKER_01: Basically, four years worth of work in baseline studies and assessments around the development proposal.
• 2:09
  SPEAKER_01: And and that amount of work just cannot be sneezed at.
• 2:12
  SPEAKER_01: You know, it's huge.
• 2:13
  SPEAKER_01: And it's a really important sort of milestone for us to have achieved within the space of approximately four years since the discovery of Shack Juwan.
• 2:21
  SPEAKER_01: And so, yeah, it's the culmination of a huge amount of work and sets us on the pathway now for final mine authorization.
• 2:30
  SPEAKER_01: And we estimate that that's going to occur over approximately the next 18 to 24 months.
• 2:35
  SPEAKER_00: Okay, so it's fast.
• 2:36
  SPEAKER_00: I mean, you know, the this filing is the result of more than four years, if you said that scientific field work engagement with the Cree Nation in uh IUishi.
• 2:45
  SPEAKER_00: Um, you know, thankfully you can this time around.
• 2:48
  SPEAKER_00: We've talked a couple times.
• 2:49
  SPEAKER_00: I'm finally getting these names correct.
• 2:51
  SPEAKER_00: But um, you know, how how does that that baseline work kind of help you navigate the federal public review period that starts now?
• 3:00
  SPEAKER_01: Yeah, the expectation is that you've done a significant body of work that describes the the impacts in the project and the benefits that are derived for the community, Quebec, and Canada as a whole.
• 3:11
  SPEAKER_01: So it constitutes thousands of pages worth of work, and the team has done an amazing job in compiling that within what would be considered a relatively quick timeline since discovery.
• 3:24
  SPEAKER_01: But that only happens because the team has put so much work in across the board, whether it's the technical studies in respect of our project, whether it's the community engagement, um, and of course the really important engagement with the Cree and the Cree Nation.
• 3:39
  SPEAKER_01: So that body of work is just enormous.
• 3:42
  SPEAKER_01: And it really is a credit to the team that they've been able to compile it in relatively short order to facilitate the next steps that take us through to final mine authorization.
• 3:52
  SPEAKER_00: Yeah, yeah.
• 3:53
  SPEAKER_00: I mean, this isn't your first mine.
• 3:54
  SPEAKER_00: I mean, look at Pilvara, but I kind of want to look at the at the math because that is where the investor attention is going.
• 4:01
  SPEAKER_00: I mean, again, your 2025 feasibility study printed a base case after tax NPV of about 1.6 billion Canadian dollars.
• 4:09
  SPEAKER_00: And that was that lithium-only study using much lower prices.
• 4:13
  SPEAKER_00: And since then, obviously, lithium prices have rebounded sharply.
• 4:16
  SPEAKER_00: I think your internal and sensitivity work suggests that a current spot price is around$2,500.
• 4:22
  SPEAKER_00: The valuation could be closer to$5.5, you know,$5.5 billion here.
• 4:27
  SPEAKER_00: I mean, is that the right way for investors to think about it?
• 4:31
  SPEAKER_00: I know we've seen that bear market with the lithium equities.
• 4:35
  SPEAKER_01: Yeah, I mean, the long-run pricing that we used in the former lithium-only feasibility study was about$1,300 a ton for a ton of Squadamine.
• 4:47
  SPEAKER_01: Uh, and here we are today with with Squadamine for approximately the last two to three months having traded in the range of$2,000 to$2,500 a ton.
• 4:56
  SPEAKER_01: So, yeah, clearly a really significant change in the market.
• 5:00
  SPEAKER_01: Uh, demand conditions, just as an aside, are very strong.
• 5:04
  SPEAKER_01: And there's reason to believe that that you know the current impasse in Iran and where oil price is would be another shot in the arm for demand in lithium markets.
• 5:14
  SPEAKER_01: And I think that's our experience, you know, the idea that demand conditions are very strong and we can be optimistic about pricing.
• 5:21
  SPEAKER_01: So, so when that's reflected in in our project, yes, it translates to you know a material amount of value.
• 5:28
  SPEAKER_01: And just remembering, you quite rightly pointed out there, Jeremy, that's lithium only.
• 5:34
  SPEAKER_01: Um, but I think most people understand we've now got this amazing opportunity in co-products in the form of cesium and tantalum on top of the lithium-only opportunity.
• 5:44
  SPEAKER_00: Yeah, yeah.
• 5:45
  SPEAKER_00: I mean, you know, you also get that strategic institutional support behind this project, very serious one.
• 5:51
  SPEAKER_00: And the Volkswagen Group and PowerCo hold a 9.9% stake in a 10-year off-tick agreement.
• 5:57
  SPEAKER_00: Now, we've been tracking a trend on our news program where companies appear to be buying early, uh, you know, to secure strategic supply, very similar to what we've seen in the silver market.
• 6:07
  SPEAKER_00: You know, you know, in a market where analysts still debate long-term demand, how much does having a global automotive giant in your corner kind of change the conversation with lenders and strategic partners as you move towards a final investment decision?
• 6:23
  SPEAKER_01: Well, there's a reason why groups like Volkswagen and PowerCo end up engaged with PMET.
• 6:30
  SPEAKER_01: And it's based on that sort of fundamental um condition around amazing geology and a very, very large-scale and high-grade project.
• 6:39
  SPEAKER_01: Um, so they they have an enormous Bain Marie in front of them of projects that they can invest in.
• 6:45
  SPEAKER_01: And they've chosen PMET and our Shaker 21 project.
• 6:48
  SPEAKER_01: Now that happens for a reason, um, and it is that you know, that it is an amazing project, and it's going to be one of the very large-scale future operations supporting lithium raw material demand.
• 7:00
  SPEAKER_01: That's what attracts a great partner like Volkswagen and PowerCo, their factory company.
• 7:06
  SPEAKER_01: So, so clearly, you know, I think that's a very strong point of validation, you know, about the future of our project and our ability to keep it moving down the development pipeline and ultimately into production and later the steco.
• 7:19
  unknown: Yeah.
• 7:20
  SPEAKER_00: You know, that the current study, and I know you just talked about this a little bit, Ken, we should probably go into it.
• 7:24
  SPEAKER_00: I mean, it was lithium only, but that's obviously not the full picture.
• 7:28
  SPEAKER_00: You have that world's largest pelucide-hosted cacium deposit and significant tantalum.
• 7:33
  SPEAKER_00: You know, some analysts are already modeling meaningful byproduct credits.
• 7:38
  SPEAKER_00: Uh, when you update your feasibility work later this year, how could those co-products kind of change the cost of production in the broader economics of the project?
• 7:48
  SPEAKER_01: Yeah, analysts sort of looking at the project now and making their own estimates around the value that's attracted in respect of the co-product opportunity.
• 7:57
  SPEAKER_01: And today they're in the range of approximately 100 to 200 US dollars a ton as a credit to the cost of our underlying spodjamin uh production at just under 600 US dollars a ton on an all-in-sustaining cost basis.
• 8:15
  SPEAKER_01: So, so that those co-products are really meaningful in the future of our operation.
• 8:21
  SPEAKER_01: And obviously, we're very, very keen to realize that value.
• 8:25
  SPEAKER_01: So we're updating the lithium-only feasibility study at our C V5 resource.
• 8:32
  SPEAKER_01: And once that's printed later this year, that will include the effect of the tantalum byproduct credit.
• 8:39
  SPEAKER_01: In addition, we'll have a scoping study or PEA that ensures we can bolt on the benefit in our CV13 deposit.
• 8:49
  SPEAKER_01: Now that's where there is ultra high grade lithium, cesium, and tantalum, and that'll affect the overall economics in the project by its inclusion.
• 9:00
  SPEAKER_01: So these are really, really important elements in the future value around our project, and we're very, very keen to demonstrate how that unfolds.
• 9:07
  SPEAKER_01: So two parts updated feasibility study for lithium and tantalum at CV5, and then the overall project economics, inclusive of C V13 and the lithium, cesium, and tantalum oxygenity it represents.
• 9:23
  SPEAKER_00: You know, talking about tailwinds here, I mean, I'm I'm taking a look here.
• 9:27
  SPEAKER_00: You're targeting roughly 800,000 tons of spogamine concentrated a year using a simple, dense media separation process.
• 9:35
  SPEAKER_00: And I bring it up because in a mining industry that often gets distracted by more complicated extraction stories.
• 9:41
  SPEAKER_00: Why is simplicity the better way to kind of create value as you move towards development here?
• 9:47
  SPEAKER_01: Uh they're all physical concentrates and recovered using physical processes.
• 9:53
  SPEAKER_01: So, so as you've said, the the lithium inside the spodgamine, the spodgamine is separated through dense media separation.
• 10:01
  SPEAKER_01: It actually doesn't get much simpler in the mining world.
• 10:04
  SPEAKER_01: You might argue it's more like a glorified quarry, really.
• 10:07
  SPEAKER_01: Um, the process is that simple.
• 10:09
  SPEAKER_01: And it's remarkable, it's essentially the same for polucite recovery for its cesium content.
• 10:16
  SPEAKER_01: You use a simple crushing, just a standard crushing enterprise, like would be at every mining operation, and then you use what's called ore sorting technology.
• 10:25
  SPEAKER_01: So ore sorting technology separates the pallusite from the rest of the rock mass, and that's how you create the concentrate.
• 10:32
  SPEAKER_01: Really simple and actually ultra low cost.
• 10:36
  SPEAKER_01: Tabalite is more of the same.
• 10:38
  SPEAKER_01: At the back end of your DMS circuit where you've taken out the spodjamin for its lithium content, you take out tantalite.
• 10:45
  SPEAKER_01: And again, simple processes, spirals and shaking cables that differentiate the tantalite because it's really, really heavy.
• 10:53
  SPEAKER_01: And uh nonetheless, a high value concentrate in its own right.
• 10:56
  SPEAKER_01: So really simple physical concentrates, no chemicals, no difficult processing techniques, spogamine for lithium, pollute for cesium, and tantalite for tantalum.
• 11:09
  SPEAKER_01: Um, simple, high value concentrates.
• 11:13
  SPEAKER_01: Uh, it actually doesn't get much easier than that in a mining operation.
• 11:16
  SPEAKER_00: Yeah, yeah.
• 11:17
  SPEAKER_00: I mean, you know, the valuation upside looks attractive in a stronger lithium market, but obviously construction costs are still a real issue.
• 11:24
  SPEAKER_00: I mean, you're heading towards a major build.
• 11:26
  SPEAKER_00: You got, what, 130 million in the bank?
• 11:29
  SPEAKER_00: Uh, are you are you concerned that any inflationary pressures in the James Bay region could eat into the economics investors are kind of focused on today?
• 11:37
  SPEAKER_01: Yeah, I think the mining industry is grappling with that issue.
• 11:40
  SPEAKER_01: Um, inflationary pressures are pretty much everywhere in the economy, aren't they?
• 11:44
  SPEAKER_01: Um, but we'd like to think that in the both the feasibility work that we've done and even historically in the previous PEA work, um, it's been a really disciplined effort.
• 11:54
  SPEAKER_01: And we continue to work on further optimization initiatives as part of our engineering studies.
• 12:00
  SPEAKER_01: So let me give you a couple of examples.
• 12:02
  SPEAKER_01: One one would relate to um the mining sequence.
• 12:05
  SPEAKER_01: We're continuing to work on bringing forward the high grade in our NOVA zone in CB5.
• 12:12
  SPEAKER_01: Um, we're very keen to get into C B13 as a future mining initiative to be able to bolt on to our base mine authorization.
• 12:21
  SPEAKER_01: And that's because CB13 is very, very high grade in everything.
• 12:25
  SPEAKER_01: The most valuable blocks actually in the property are at CB13, high grade lithium, high grade cesium, high grade cantalum.
• 12:33
  SPEAKER_01: Um, we're also looking at modularization of the DMS plant.
• 12:37
  SPEAKER_01: The benefit in that is to both accelerate the construction timeline, but also potentially to lower its cost of construction.
• 12:44
  SPEAKER_01: Um, that's because prefabbed or manufactured modules can come to site ready to plug and play.
• 12:52
  SPEAKER_01: Um, that also looks like a fantastic opportunity that the team is working on uh to continue to defend our future construction costs.
• 12:59
  SPEAKER_01: So still plenty of opportunities there, Jeremy, to be worked through.
• 13:03
  SPEAKER_00: Yeah, yeah, I was gonna say, I mean, you know, big asset, big upside, yes, but I also, you know, big also means capital intensive.
• 13:09
  SPEAKER_00: Uh, I just you're speaking to investors right now.
• 13:12
  SPEAKER_00: I mean, why should investors see scale here as an advantage and not simply, you know, any bigger financing challenge?
• 13:19
  SPEAKER_00: Because it feels like you're kind of on top of things.
• 13:22
  SPEAKER_01: Yeah, I'm I mean, in mining, scale is worth everything because you generate economies of scale in the the operation itself.
• 13:30
  SPEAKER_01: Um, but also you have to be meaningful to your customers downstream.
• 13:34
  SPEAKER_01: And I guess the the truth is as lithium raw material markets grow, scale becomes more and more relevant.
• 13:42
  SPEAKER_01: Um, by the time we're in production in our stage two operation at 800,000 tons per annum of Scorching Moon concentrate, um, we'd be in the top five of the global hard rock operations and clearly the largest in the Americas in the hard rock category.
• 13:58
  SPEAKER_01: Um, that means you can attract key partners like that that we've done um with Volkswagen and PowerCo, um, but maybe yet others as well, um, because we like the idea that a consortium works around this project for all of its um scale and its opportunity and low cost.
• 14:16
  SPEAKER_01: Um, we attract more key partners to the future of not even just the mine, but also the uh chemical initiatives that sit downstream.
• 14:26
  SPEAKER_01: And that same opportunity, Jeremy, that also exists in cesium and tantalum.
• 14:32
  SPEAKER_01: Because of the scale in the cesium discovery, it's actually breaking the record books.
• 14:38
  SPEAKER_01: It's it's uh it's absolutely enormous.
• 14:39
  SPEAKER_01: Approximately 2.4 million tons in per plu site for cesium so far, but with the target still being open.
• 14:48
  SPEAKER_01: Now, what that means is that we will be really meaningful to the world, the future world of cesium.
• 14:53
  SPEAKER_01: And and we think that as cesium becomes more abundant, like with the discovery that that exists at Shaka Juwanan, that you've got an opportunity to be really meaningful in the future of cesium markets and actually even grow the market.
• 15:06
  SPEAKER_01: Um, because today it's resource constrained, there's just not enough.
• 15:10
  SPEAKER_01: Caesium is is rare.
• 15:11
  SPEAKER_01: Um, and even for its classic industrial uses, I think there's an argument to say if you had more cesium, you'd be selling more cesium.
• 15:18
  SPEAKER_01: So, world's largest, I think by anyone's measure, there's not going to be any debate there.
• 15:23
  SPEAKER_01: It's enormous and likely to get bigger, and that means we'll also be meaningful to the future of the cesium world.
• 15:29
  SPEAKER_01: Uh lastly, well now tantalite resource is a top five tantalite resource globally.
• 15:35
  SPEAKER_01: So it's also a very important future source of production for those key critical minerals.
• 15:41
  SPEAKER_00: All right.
• 15:42
  SPEAKER_00: Uh we can almost leave it there.
• 15:43
  SPEAKER_00: You know, I I guess I give you a little bit of a pre-one at the end here.
• 15:47
  SPEAKER_00: I know we don't have a glass, you know, a ball in front of us to understand what the future looks like.
• 15:51
  SPEAKER_00: But for investors kind of watching this today, I mean, what is the the one milestone over the next, say, 12 months that you believe will matter most in kind of determining whether PMET gets re-rated from here?
• 16:05
  SPEAKER_01: It's really the the co-product opportunity.
• 16:07
  SPEAKER_01: That is a very, very important just um distinction in the Shaka Jawanan project.
• 16:13
  SPEAKER_01: Um, typically these hard rock lithium projects just do not have such a strong co-product opportunity like we have in Cesium and Tantalum.
• 16:22
  SPEAKER_01: Easily.
• 16:23
  SPEAKER_01: Breaking the record bus, actually, world's largest Cesium resource and a top five tantalite resource.
• 16:28
  SPEAKER_01: The scale in those co-product credits puts Shaka Jawanan into a completely different lead to just about any other hard rock resource globally.
• 16:37
  SPEAKER_01: So, of course, we're very keen to show what that detail looks like and hence the update in the feasibility study later this year.
• 16:46
  SPEAKER_01: Um, but in the intervening period, we've got more important work to do commercially.
• 16:50
  SPEAKER_01: We're engaged with everyone in lithium, cesium, and tantalum, and we're pretty keen to demonstrate what those relationships look like.
• 16:57
  SPEAKER_01: Um, and in the meantime, uh, we've also raised money recently, actually$180 million Canadian in the bank, um, of which a decent chunk is dedicated to uh drilling at Shoka Jawana.
• 17:10
  SPEAKER_01: And we're pretty confident that if we keep drilling, there will be more discoveries.
• 17:14
  SPEAKER_01: There will be growth in resource and ultimately growth in the reserve.
• 17:19
  SPEAKER_01: Um, so yeah, we're came to demonstrate to shareholders what that constitutes and why this will be the leading hard rock, lithium, cesium, and tantalum project globally.
• 17:28
  SPEAKER_00: Yeah, Ken, clearly an important day for the project, major milestone in the permitting process.
• 17:33
  SPEAKER_00: Uh, investors will now be watching the next study update, that that path forward and and uh you know the scale and execution.
• 17:40
  SPEAKER_00: Uh Ken Brinston, CEO of PMET Resources.
• 17:43
  SPEAKER_00: Thanks for joining us today.
• 17:44
  SPEAKER_00: I know it's early where you are, and congrats on this news, pretty big deal.
• 17:49
  SPEAKER_01: Thanks very much, Jeremy.
• 17:50
  SPEAKER_01: Proud to be with you.
• 17:51
  SPEAKER_00: Thanks, Ken.
• 17:51
  SPEAKER_00: Appreciate it.
• 17:52
  SPEAKER_00: And thank you for watching KidCo Mining.
• 17:54
  SPEAKER_00: We're tracking the projects, the partnerships, and the market shifts that matter to investors.
• 17:58
  SPEAKER_00: I'm Jeremy Sappord.
• 17:59
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• 18:00
  SPEAKER_00: We'll see you the next one.