Categories: Base Metals
Topics: General Base Metals

Medallion Resources (TSX-V: MDL)(OTC: MLLOF) CEO Mark Saxon on Advancing Its Monazite Process & Discussions with Prospective Partners

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the President and CEO of Medallion Resources, Mr. Mark Saxon. Mark, how are you today?

Mark Saxon: Gerardo, good afternoon. Great to talk to you. I'm doing well. Still in Australia here; nowhere to travel to. But yeah, doing fine and getting work done almost every day. So, doing well.

Gerardo Del Real: Well, it sounds like you're being productive. The rare earth space tends to be, obviously, very cyclical when it comes to news flow. All of a sudden, there's a lot happening, and then all of a sudden, it tends to get quiet for a month or two. I think we've had a bit of a quiet period, though. There's been some material events that have happened behind the scenes that I think haven't been noticed by the market.

Medallion has been busy, of course. You mentioned working everyday and being productive. The most recent piece of news came yesterday, where you completed diagnostic testing with the Australian Nuclear Science and Technology Organization. It's always a mouthful for the rare earth company headlines. Can you give us the context, Mark?

Mark Saxon: I like that introduction, Gerardo, and absolutely. Rare earths comes and goes, I guess, in the media sometimes. And yeah, sometimes you see a headline every day or multiple a day, and then sometimes it disappears. And we're going through one of those little quiet patches, but that's a good thing. It's an industry that we want to be growing in the background. And prices are increasing globally. And yeah, the market as a whole, is doing a good job, so we're pleased with that.

With Medallion specifically, yeah, absolutely we're continuing to work in the background and getting our work done. The recent press releases, particularly about a bit of a transition we've made to be using, as you said, ANSTO, the Australian government organization, to do some of our test work here in Australia. The reasoning behind that was ANSTO is an absolute acknowledged world leader in the rare earth industry. They've been very, very instrumental in all the major projects here in Australia and around the world, developing projects. Combined with that, Australia has abundant resources of mineral sands, and that's where Medallion is going to be drawing their monazite from. So really, it's the perfect kind of association for us to be working with the people who really know their stuff and have demonstrated that through the work they've done at Lynas Corp, and really making things happen.

Gerardo Del Real: Excellent. So walk me through next steps. What does that look like as far as relevance to Medallion and to shareholders? It's obviously a step in a multi-step dance, right?

Mark Saxon: Yeah, absolutely. And these are long pathways. And rare earths, in particular, is a long pathway in the mining industry. And the Medallion approach is to shorten that path as much as we can by using the by-product mineral, which is monazite. So I guess the work that we've just completed and we've just PR-ed on is what we're calling diagnostic testing. And so, really what we're doing with that work is, let's call it characterization, I guess, as well. We take a commercial or a pre-commercial sample of monazite from a mineral sand mine. And we collect from that small sample, a set of characterization data, so that's about its minerals and its metals and some other key features. We then run that sample through our process and then we acquire data again, and we're then able to connect between the sample as it came directly to us, and that set of data and the way it processed.

And so that is allowing us to build up what we're calling a matrix of information. And so, it means we then don't need to do that second test. We can just look at the original data and say, "All right, on the basis of this set of information, we know exactly what it's going to cost us, how it's going to process, the chemicals that are needed, the energy and the value of the product at the back end." And so that first set of data, the diagnostic data, we can acquire that now at almost any lab around the world, really that's happy to accept a monazite sample. They send us the data, and then we're able to know whether that's a positive partner for us and really how we want to work with that sample. So, we're skipping a few steps in the process. And so, that will allow us in the future to make much more nimble decisions, and to know who we need to be talking to and which materials we want to be targeting in the markets. And yeah, we can really accelerate that business.

Gerardo Del Real: And again, just for people that may be new to the Medallion story, can you explain the benefits and why the focus of monazite?

Mark Saxon: Yeah, absolutely. And so monazite is a mineral, and that mineral is a very high grade mineral in rare earths. It's a very dense and heavy mineral, and so that means it gets concentrated in mineral sands, the same as other heavy minerals do. So, operating around the world today in Australia, South Africa, Madagascar, Mozambique, Sri Lanka, many places, heavy mineral sand mines that were built to extract titanium minerals and zirconium minerals, so they are also heavy minerals. In that process, when those titanium and zirconium minerals are extracted, the monazite, the rare earth mineral hasn't really had a market, so it's been left on the mine site. In some cases, it's been sold to Chinese customers. So Medallion is targeting use of that mineral sand monazite, which is already being mined and handled and concentrated today without having a market. So we take that mineral sand monazite, and we process that and extract the rare earths.

So it's a very good mineral to be using, because it's very high-grade. So it's about 60% total rare earths in the mineral itself, which is extremely high. It has a very high content of neodymium and praseodymium, which are the magnet metals, and so that's a great benefit and puts up its value. The other beautiful thing, which is rarely talked about, is that it's really homogeneous. And so, whether we buy from Australia, Victoria, or from New South Wales, or from Western Australia, or from South Africa, or from India, or wherever else we get it from, it's almost identical. And so, with this little bit of diagnostic testing, we're able to work out exactly where it fits on the matrix and know exactly how to process it. But wherever the material comes from in the world, we're able to process it, and that's a really unusual and rare thing in rare earths. And as you know, rare earth processing is incredibly difficult, incredibly lengthy, and most projects fail because of complexity. And yeah, this is a way of reducing some of that complexity in the process.

Gerardo Del Real: Excellent summary. What's next Mark?

Mark Saxon: Thanks, Gerardo. I'm not sure that was a summary, but it was a long answer for a summary. So yeah, we're continuing on that front. In the press release we had out this week, we also mentioned the techno-economic study. And so the techno-economic study is ongoing for us, and that really is the independent pull-together of all of the data that we've acquired to date to produce an operating engineering model and financial model, to show us the value of the process. We had hoped that was going to be finished by the end of Q1. It's been pushed back a little, just people in the wrong places with COVID and things, that everything's taken a little bit longer. So yeah, we acknowledge the good work of the consultants, but yeah, not much we can do about that at the moment. So that's getting very close now.

And in combination with that techno-economic analysis, we're also doing a lifecycle assessment, and so that will also measure the carbon footprint of the production of rare earths using mineral sand monazite. Because we're not connected to a mine, because we're not operating in a remote location, because we've got a very, very efficient process that we've designed, we're certainly of the opinion that our environmental footprint from this will be extremely small and will be the most environmentally-friendly way of producing rare earth metals.

And certainly, our vision is to set up process hubs, I guess you would call them, where we aggregate the mineral sand monazite from regions. So we're not going to be transporting mineral sands across the world, because that just builds up the CO2 footprint. We'll be operating locally, employing people locally and adding value to the jurisdiction locally. I think that's the very best business model from an economic point of view, and from a lifecycle and CO2 point of view.

Gerardo Del Real: It almost sounds like the franchise model, right? For monazite sands and production of the by-product?

Mark Saxon: Yeah, it kind of is. And certainly, the work we're doing both on the rare earth extraction from the mineral sand monazite, and also from the separation process, we're viewing it as a bit of a plug-and-play process. So all of our engineering and design is simplified and it reuses chemicals, it reuses heat. It's highly optimized. And so, yeah, it can be operating at a fairly modest scale, or it can be rolled out at a larger scale, depending on what the market wants and depending on the volume of mineral sand monazite in a certain location.

And that's obviously very attractive to governments and to regions who want to see value captured in their own region. They don't want to be sending off a low-value concentrate to the other part of the world. They want to be capturing some of that value from the rare earth themselves, but also the opportunity for downstream value add. So every region we talk to has that same point of view, that, "How do we get a foot in the door in the EV industry? How do we acquire the critical materials that are essential for that?" And yeah, this is absolutely part of that.

Gerardo Del Real: Fantastic, Mark. I'm looking forward to the results from the study. I know there's other things in the works that you'd rather wait to touch on. I think this was an excellent, excellent update. Anything else you want to add to that?

Mark Saxon: No, I think that's great, Gerardo. And yeah, let's stay in touch and I'll keep you informed on our progress as a company.

Gerardo Del Real: Fantastic. Thanks again, Mark.

Mark Saxon: Thanks Gerardo. Cheers.

Gerardo Del Real: Bye, now.