Categories: Base Metals / Energy
Topics: General Base Metals / General Energy

Medallion Resources (TSX-V: MDL)(OTC: MLLOF) CEO Mark Saxon on Rare Earths & Exclusive Rights to Purdue University's Separation and Purification Technology

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?

Mark Saxon: Gerardo, doing very well. Good afternoon. Hope you're warming up and doing fine as well.

Gerardo Del Real: We're warmer. There's power. There's food. There's heat. There's gasoline, all the creature comforts. Right? So yes, yes. Back to the regularly scheduled program for the time being. Thank you so much for asking. It's been a busy time in the rare earth space. It's been a busy time for Medallion. You recently had some news that the market really, really responded to, and that was securing the exclusive rights to Purdue University's rare earth element separation and purification technology. A mouthful, obviously, but congratulations. I know it's a milestone for the company and again obviously very well received by the market, Mark.

Mark Saxon: Thanks very much, Gerardo. And I guess as you said, it's been a really busy time in the market generally. And the rare earth sector, I think, is continuing to surprise people. And we've seen recently the export quotas from the Chinese government have been published and sometimes they're used as a bit of a tipping point in the market, but metal prices continue to go up five and 10%, I guess, from the major metals after that announcement. So that's great to see. Certainly as a company, we're seeing lots of interest from real customers and the guys that actually use rare earth metals, so it's not just speculation. So that's a great thing and yeah, and most share prices are going up. So I think, yeah, there's a real alignment in the market that we haven't seen for a very long time.

I guess a little bit more on Medallion specifically, so yeah, we've talked at length at Medallion and I guess with the recent transaction, we're now a company of two parts. And yeah, I'll let you ask a few questions in a moment, but I'll just give a bit of a monologue first. But I guess the older, existing part that we've talked of in the past is our Mineral Sand Monazite process. And so that's where we've been, I guess, spending about five years of research. And that's focused on how to extract rare earths from a bi-product mineral, which is called monazite, Mineral Sand Monazite.

So that's been, I guess, the embedded and the incumbent business for us that's gone really well. And I guess as we have been approaching a milestone in that, then we've been looking at our place in the supply chain. And yeah, you've been around rare earth long enough, you know that rare earths is a very supply chain driven business. It's mineral industrial metals, and so you really need to know your upstream and downstream customers. And so what we've done now is to, I guess, strengthen our position in the supply chain and ensure that, yeah, we're highly relevant with the new technology.

Gerardo Del Real: Let's get right into the exclusive rights and how this deal came along. I had a really good conversation last week that I'm excited to publish soon with Dan Hasler. And so maybe if you could provide some background into his involvement and what this means for Medallion moving forward.

Mark Saxon: Yeah, for sure. So, yeah, I guess what we're talking about here is the rare earth separation part of the business. So that's, I guess, the downstream from what we've been doing in the past. So with our process, I guess we've been focused on the most environmental and the lowest impact way to produce rare earth elements. And so I guess we took the view that we wanted to pair that with another company or process that was also very low impact and very low carbon emitting. So it's quite a complex field. And so I guess the first thing we did was appoint some experts to be able to lead us through that process. And so we went out into the market, we spoke to many separation providers, about 25 in all. And yeah, thank you to those parties. And we began to identify opportunities for rare earth separation.

So rare earth separation is where you've got, I guess, one mixture of materials and you separate them out into the individual high value metals that are actually going to go to the customers. And so, yeah, think about the metals that go to rare earth magnets. Those are quite different to the metals that go to rare earth catalysts or to catalysts, and so they need to be separated and purified. So we looked at, say 25 different companies and we then saw that those fell out into four different technology clusters, I suppose you would call them. One of those clusters is the one that we have focused on and that's a technology sector called chromatography.

And I guess the reason that we really liked chromatography was that it doesn't use solvents. It doesn't use harsh chemicals. So we saw that as a clear alignment with what Medallion has been trying to do and disconnecting from the petrochemical industry. And then we looked more closely within the chromatography sector and that identified the work that Dan Hasler and Linda Wang and Perdue has been doing over the last, oh, really 10 years.

So yeah, we identified, I guess, from that review that the chromatography was the technology cluster that we favored the most. And I guess chromatography as a process is extremely well-known. And the reason for us liking it is because it's free of solvents. So it doesn't require harsh chemicals. It's processing within water. And for that reason in particular we saw it as a very good add-on to the work that we've been doing in Medallion. So we're reducing the footprint of the production of rare earth elements. And through that process, we identified Dan Hasler and Linda Wang and Purdue, and the great work they've been doing. So yeah, it's a very exciting time to have them within our group now.

Gerardo Del Real: Excellent. Let's get right into the other aspect of what Medallion is going to look like here as we move further along in 2021. I know that you're entertaining multiple options. The technology obviously lends itself for that. Can you give us some context there as to what we should be expecting from Medallion?

Mark Saxon: Yeah, for sure. So we're seeing with the work of Linda Wang and the Purdue University that they're really quite advanced. They've done a decade of work on this rare earths element separation. And Purdue University, as I'm sure or perhaps you know, is famous for work in pharmaceuticals. So when you think about what we do in rare earth industry and the rare earth separation, it's relatively easy compared to what's been going on in pharmaceuticals and preparation of high-purity chemicals. So we understand that that Linda can move quite quickly and with the right funding, she's able to sort of accelerate this process.

The contract that we have done with Purdue and with Dan Hasler means that we're able to apply the technology, not just to Medallion's needs, but we're also able to go and sub-license this technology to third parties. So that's particularly exciting. So that gives us a whole other business unit and already we've had emails and phone calls after our press release. So we can step in and do the rare earth separation for other partners and other companies around the world. And that's really a whole new thing for us. And Linda's technology is very flexible in that regard. And we're able to pivot into those other materials and yeah, obviously some test work and a whole heap of maths sits behind them, but we're able to pivot very quickly into those other materials as well.

Gerardo Del Real: Stepping back a bit and talking about the macro scene with rare earths, how do you see that developing? I mean, look, you and I did very, very well once upon a time about a decade or so ago in the space. It was extremely profitable to say the least. But I can't help but notice, Mark, that there is more capital, intellectual capital, geopolitical bipartisanship on this issue to develop domestic critical metals chains. This didn't exist back in the last rare earth boom. It was a lot of speculation and, frankly, a lot of hype. And we knew even back then that it would be a decade or so or decades before there was any meaningful change in establishing a domestic critical metals supply chain, whether it was Europe or here in the US. There seems to be real will now to do that. Do you see that accelerating and continuing on a sustainable basis?

Mark Saxon: Yeah, it's certainly a very different business this time to what it was in 2010. And I guess if we cast our minds back, and you and I, we were both very excited at the time about what was developing, but it was purely a geopolitical story. It was about defense industries. It was about lack of access to materials. And there was, let's call it a panic went through the market and the market didn't know how to respond to that. They'd never heard of rare earths before. I think this time round and I guess last time, yeah, you would have to say it felt a bit too good to be true at the time.

Gerardo Del Real: It was.

Mark Saxon: I think this time round the interest in the metals is driven by industry. So this is not defense driven. This is not geopolitics. This is driven by industry wanting long-term sustainable access to ethically produced raw materials. And you can tell exactly the same story for graphite and for lithium and for cobalt, because this is being driven by wind energy, and it's being driven by EVs and it's being driven by solar energy and yeah, vanadium, for example, for battery storage as well. So this is a much, much bigger wave. And so this is companies and countries saying, "Where do we get the materials from to do the energy transition?" And certainly there's a lot more meat on that bone and so it's not purely a conflict between the US and China or China and Japan, as we saw last time. This is industry trying to make something work.

And so I think this is now drawing in major funds and major money into the sector to say, "How do we source these materials for industry?" And we're going to see that flow through rare earths, but we see it in lithium with a great jump recently and we see it in graphite as well for exactly the same drivers.

Gerardo Del Real: Interesting times to say the least. Mark, is there anything else that you'd like to add to that?

Mark Saxon: No, I think personally, I'd like to thank Dan Hasler and Linda Wang for the great input they have made and will make to the company. And it's a very exciting time. Like to work on a technology that we absolutely regard as a breakthrough, there's not many times in a career that you get to do that. And really, the penny dropped for us, yeah, maybe six weeks ago, where we got to know Linda Wang's technology well enough to say, "Yeah, well that probably is the game changer that we've been looking for." And to have the opportunity to invest in that has been tremendous. And yeah, I think it's very exciting times ahead for what we're going to be doing.

Gerardo Del Real: Good work, Mark. Looking forward to having you back on. I know from subscribers that have written in that there's a lot of happy shareholders right now. And like I try to remind them, there's always pullbacks, but I think it's early for Medallion and for the progress we're going to see in the rare earths space.

Mark Saxon: Absolutely. And the race isn't won in the share price of a week or two, but yeah, we're happy the way the share price has built up and we're seeing lots of inflows of warrant money, so yeah. There's cash in the bank and yeah, a well-positioned company is all I can say.

Gerardo Del Real: Fantastic. Keep in touch, Mark. See you soon.

Mark Saxon: Thanks, Gerardo. Talk soon. Bye.