Global Battery Metals (TSX-V: GBML)(OTC: REZZF) CEO Michael Murphy on Visual Indicators of Lithium Mineralization in Ongoing Phase-1 Drill Program at Flagship Leinster Lithium Project, Ireland
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president & CEO of Global Battery Metals — Mr. Michael Murphy. Mike, how are you this morning?
Michael Murphy: I'm doing great, thanks. How are you doing?
Gerardo Del Real: I am doing well. Let me get right into it because this is a new story to our audience. I am a big believer in the near-term, mid-term, and long-term price action as it relates to lithium. I am a bull when it comes to battery metals.
And I really love introducing stories to our audience that have scale and that have management that has a history of success. In this case, you have multiple, multiple directors, and yourself, obviously, that have been able to take companies from small caps to billion and multi-billion dollar valuations.
And I really love when a company looks around and is forward-thinking in the way they make the acquisitions that are in the portfolio. Global Battery Metals not only checks all of those boxes for me, it also happens to be trading near a 52-week low, which I know probably doesn't make you happy. But for me, me being a contrarian and introducing this to our audience, it's absolutely perfect for what I think is going to be a pretty successful run.
Let's get right into it. That was a whole lot there in the intro. I want to get into a bit of your background first because I mentioned that history of success, and it's pretty extensive with you and your team.
Michael Murphy: Yeah, with this team we've put together, we’ve got two super experienced geologists. Cam [Bell] was the ex-head of project origination for Vale. JP [Jean-Philippe Paiement] was the ex-head-geologist for Nemaska Lithium. Alan Matthews and Craig Roberts are mine engineers. They’ve run mines; they've built mines. Craig is the past CEO of Newfound Gold, which went from a penny stock to be worth over a billion dollars.
My background is 15 years with the investment bank in London; I ran the hedge fund coverage group for Credit Suisse. And I started a company years ago called Torex Gold. We took it from a C$4 million shell. I think the market peak was about C$2.5B, and it's currently about a billion and a half today. We took it from exploration, built it, put it into production. And last year, it produced 475,000 ounces. That's us.
Gerardo Del Real: I think that is a perfect opportunity for me to ask you… where's your market cap right now? You mentioned taking a penny stock and taking it to billion dollar valuations. And here we are, right?
Michael Murphy: It's ‘heartbreaking’ is where it is! It's about C$13 or C$14 million.
Gerardo Del Real: Excellent. Again, perfect for my contrarian heart and our audience because that's the opportunity. I love introducing stories that are early stage but have assets that have scale and that are in jurisdictions that are top-notch. And in this case, again, you check both of those boxes.
Let's talk about the focus on jurisdiction for you. And then, let's get into the portfolio because it's assembled well.
Michael Murphy: Yes, thank you. Jurisdiction is key. If you don't have a sensible regulatory environment and you don't have social license, you don't have anything. So we have really focused on areas that have that.
And currently, the three projects we're working on actively are in Newfoundland, in Utah, and in Ireland. All three of those jurisdictions have really great and easy-to-understand mining codes and processes. And we follow the rules. We put in a drill permit application in Ireland, and it got approved in 10 days. Follow the rules… and they’re very good about communicating to you what the rules are.
And they're all communities that have, more or less, accepted mining. As long as you're responsible, you communicate, and you engage — you can build a mine. That's certainly an important part of the formula.
Gerardo Del Real: Tell me about the approach when you decided to go looking for assets. You mentioned Craig Roberts, yourself, the team, and the experience and the network there.
I know that your contact list is extensive. I know you could have gone anywhere. Why the projects that you have now? And then, I want to talk about what I'm calling the flagship, which is the project in Ireland. That's the one that's seeing drilling as we speak. And drilling that, as I understand it, the people overseeing it... I'll caution that it's early… but with lithium, you can see if you are getting what you like.
Michael Murphy: You can see it in the core; a non-geologist can see it in the core. So how do we come across these projects? We've looked at dozens and dozens of projects. We've got a super group of guys that are technical. We can get through the first review fairly quickly. We look for projects that are district-scale and that certainly have some potential.
We're not going to look at something that's completely grassroots. And we want to be able to own a material portion of it without really paying for it; i.e., we want all of the money and all of the effort to go into the ground.
If something gets proven up — terrific! The person that brought us the project, or whatnot, we're happy to be fair about it. In Utah, for example, we found old technical reports; we managed to stake the ground just with the state and with the BLM. And we don't have any partners.
The property in Ireland, our partners over there, they did a review of a whole bunch of technical reports going back to the '70s and they found one of these licenses that had a pegmatite dike on it. Guys were looking for uranium back in the '70s; they found the pegmatite dike, and they were annoyed by it. We found the technical report, and we were happy by it! So, we staked the ground.
Until we earn-in 55%, which we just passed, all of the money went into the ground; nothing went to the person that brought us the transaction. Having said that, once we find something and we get some critical mass, etc., we're going to be fair.
Gerardo Del Real: You mentioned the word ‘critical,’ and where my brain goes is the EU just passed a critical metals act that's going to be pretty important as far as capital allocation. You know the capital markets very well with your background. You have to be excited to be the first ones to drill this project in Ireland and to be seeing what you're seeing in the core thus far.
Michael Murphy: You mentioned two things there that are interesting. One, I’ll be interested to see how the EU implements this policy in that they’re talking about 10%, or whatever it is, of metals must be sourced from Europe. I'm aware of one other really small lithium mine in Europe. The lithium exploration industry in Europe is kind of developing, so I'll be interested in how they allocate that. I'm sorry, I forgot the first part of your question.
Gerardo Del Real: No, no, you actually answered the first part. I was talking about the EU and the critical metals act. And then, just the fact that that's got to excite you… the potential to have a project that's never seen drilling and modern exploration and be hitting on all of the holes, thus far, visually. That's got to be exciting for the team.
Michael Murphy: Yeah, and it's a huge property. It's 525 sq km. And in the middle of it is Ganfeng, the big Chinese company, who are going to drill. They've got an 8,000-meter drill program, which they’re going to start within weeks. So there's going to be a lot of activity. It's developing to be a neat target. I mean, 525 sq km is a pretty consequential piece.
Gerardo Del Real: And for those that have followed stories like the ones coming out of James Bay — the Patriot Battery Metals of the world and the several others that are exploring there now — that region has really become known for lithium spodumene-bearing pegmatites. And this is, although in Ireland, a similar type of district-scale land package that you're exploring, correct?
Michael Murphy: One hundred percent. If you dig deep, you can find some of Ganfeng and their joint venture partners that drew results from — don't date me on this — four or five years ago. And they were getting decent intercepts, like 20 meters at 2% and that kind of stuff. You get enough of those and it starts to get economic.
I just caution people to make sure you look at what is the true width of a drill hole. Some companies like to drill right down the center of the dike.We're not going to do that! When you're comparing apples-to-apples, just make sure it's not apples-to-oranges.
Gerardo Del Real: Excellent. When do you anticipate assays? Listen, that's going to be the catalyst that I think really lights the stock on fire and gets things going, especially at these depressed market valuations. When are you expecting to get the actual assay confirmation that you indeed are hitting on these holes that you've drilled thus far?
Michael Murphy: Fair question. I gave up a long time ago trying to predict assay lab turnaround times. I will say, we've got most of the drill program done; we've got the lab behaving a little bit better in terms of turnaround times. I'm not going to give you a specific time but I'm hoping sooner rather than later.
Gerardo Del Real: You mentioned the project being adjacent to Ganfeng's asset, right? I have to believe that if you're successful — and maybe these conversations are already happening — but I’ve got to believe if you're successful, you're going to be having people knocking on the door.
You have the right to earn up to 90% of this project. Obviously, that's a significant stake there. Are those discussions already happening or are you aware of people watching?
Michael Murphy: That's kind of a funny question to answer. What I'll say is, the technical guys that work in the Ganfeng project are well-known to our technical guys. They all used to work together. So there's a pretty good sharing of dialogue back and forth about what's working and what's not. I've got to be careful about commenting about some of that other stuff so I'm going to pass on that for a minute.
Gerardo Del Real: No worries. Let me ask you maybe a better question… and you can pass on this one too if you'd like. I’ve got to believe, again, with the network of contacts that you have that you're always looking at projects.
Is there still the chance for you to be able to roll in projects that can be accretive because, again, these projects that you have in your portfolio were projects you brought in before it was really trendy to have ‘Battery Metals’ in your company name, right?
Michael Murphy: Yes… we kind of ‘drank the Kool-Aid’ long before it sort of became headline news and, hence, why we were able to get some of these things, particularly this Irish project, on such good terms.
To answer your question, I spend about 20% to 30% of my time looking at things that could optimize our portfolio. I look at a lot of stuff. And a lot of it is not worth a second look — let's be polite! But we're really actively engaged in trying to find stuff that adds value to the project portfolio.
Gerardo Del Real: You have an experienced team, you have a tiny market cap, you're waiting on assays, you have district-scale projects, and you're drilling the right types of deposits. And what I mean by that is you can create value really, really quickly.
When we talk about the Patriots of the world, it wasn't very long from when they put their first hole in there to them publishing a very, very robust maiden resource estimate. Unlike some of the other commodities, you can size up what you're onto rather quickly.
I think it's a heck of a speculation. I'm looking forward to having you back on. Anything else to add to that, Michael?
Michael Murphy: No, that's great. I appreciate your time. And as you said, it's an exciting time for us. We've spent a long time putting this all together, and it's all starting to come together.
Gerardo Del Real: Good. Well, I'm looking forward to having you back on. Thank you for your time, sir. And let's chat and see what was in that core here soon, hopefully.
Michael Murphy: Okay, all the best. Thank you.
Gerardo Del Real: Alright, cheers!