General Base Metals
Patriot Battery Metals (CSE: PMET)(OTC: PMETF) President Blair Way on The Largest Hard Rock Lithium Deposit in America
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president of Patriot Battery Metals, Mr. Blair Way. Blair, great to have you back on. How are you today?
Blair Way: I'm good. It's nice to be talking to you live from the James Bay region for change. Up here in the cold and snow but also with the drills turning. It's a great opportunity to get to site and see what's going on.
Gerardo Del Real: Your timing is perfect. You had a news release this morning that was very well received by the market. I'm a simple guy so I'm going to give you my simple take on it.
We know that the first five drill holes from the initial program that we have assays back from... when you saw the pegmatite it correlated well with the spodumene, right? And it correlated well with consistent grades throughout and I think that's what really got us that were early to the story excited about the potential because you have what was initially 2 kilometers of trend and then potentially 20 kilometers of trend. You've now consolidated the entire land package and added to it and you now have over 50 kilometers in trend.
The news release you put out this morning spoke to the first six drill holes that have been completed for a total of approximately 1,329 meters. Again, and I think this is the important part, I want to stress it's early, but all six of these drill holes have encountered what you describe as significant intervals of pegmatite with intercepts that are near continuous and ranging from approximately 12 meters to 121 meters core length. Cores are being processed and obviously we're all excited about assays, but how's it look when you're there in person?
Blair Way: Obviously being up here at site I can spend time talking with the geologists and talking through what we're doing but big picture here is we've got this massive 50 kilometers of ground that we're working on drilling in about a 1.8 kilometer zone between CV1 and CV5. That drill program over the winter period we can be on the ice and drill easily instead of being on the water in a barge or something. This drill program that we're doing right now is showing us what's basically connecting the CV1, which is to the east, and then the CV5, which is to the west, across the other side of the lake. We're working our way from the west to the east. And that's really what the purpose of the news release was: to let people know how the drill program's going.
The weather has been cooperating mostly and we're making progress. Both drilling the holes but we're also seeing meaningful pegmatite in pretty much every hole we're drilling, but it's also showing us the connectivity. As we advance towards CV1 that's our intention that we'll continue to see these pegmatite intercepts. Taking that beyond just this winter drill program into the spring and summer drill program and the field work we have to do, we're going to continue to work in this area between CV1 and CV5 with the drill rigs, but we're also putting a crew on the ground to look at our 50 kilometer stretch of ground, chasing down outcrops and actually doing some sampling, whether it's channel sampling. Then eventually if things are looking right, then we'll also move a rig over and do some drilling on some of these targets.
We've got a ton of targeting to do this summer. We've got a ton of drilling to do on the areas that we're working in now so it really is a fantastic time for the company to be not only proving up an area that we are working in and have a high level of confidence, but we also have a great deal of ground to continue to explore and then find more drill targets.
Gerardo Del Real: These first six holes that you referenced in the news release Blair, can you provide us some context as to how spaced the current drilling is and how much of that trend is covered with the initial six holes and obviously with two rigs turning? The follow up to that: how wide a net are you trying to cast with the initial program?
Blair Way: The spacing is always a challenge because if you go too wide you may not know where or what you've missed, but at this stage we're working in 100 meter increments. As we work from the west at CV5 to the east where CV1 is we're making 100 meter steps. We're also doing some 100 meter step outs from there.
So what the means, to answer your question, how much of the trend have we drilled in from CV5 towards CV1: we've probably worked a couple 300 meters now and from the other end with drill rig two we are again another 100 or 200 meters in that direction. Drill rig two showed up a little bit later.
So all up, we've probably identified somewhere in the order of 400, maybe even 500 meters both ways where we're seeing this connectivity or some form of connection. As we feed that data into the model, and it's not perfectly linear in everything... has some variability there, but as we continue to fill in the gap between the drilling at rig one and rig two as we advance each rig towards each other then we'll have that connection and better understand the relationship of what's going on down below in the ground.
Gerardo Del Real: Correct me if I'm wrong Blair because I'm directionally challenged sometimes but it sounds like with one rig you're drilling and stepping out on 100 meter increments to the north and with the other rig it's a hundred meter step outs to the east. Is that correct?
Blair Way: No, no. We're starting on the west side. CV5 is at the west end of the trend and CV1 is on the east. We're basically working from the west towards the east and then rig two is from the east working towards the west.
If you drew a line from east to west approximately we're following that line in 100 meter increments until we connect that 1.8 meter trend. Hopefully 1.8 kilometer trend.
Gerardo Del Real: Right, understood. And so obviously that's going to be critical because if the assays come back from these first six holes and they're anything like or even exceed the first four, five holes that we got, all of a sudden you start getting a much clearer picture as to the potential for tonnage, grade... and then obviously you can start amplifying that by 100 meter step outs, 150 meter step outs and really, really filling in the blanks. It's not hard for me to imagine, and again, I'm biased, I'm a shareholder, I was early to it before we had the clarity as to the direction even on what was going to be the flagship. Corvette has clearly emerged as the flagship. But from my biased opinion it doesn't seem like a far stretch to say that if you're able to put a resource estimate here in 2022 you could be showing the market the potential for triple digit tonnage. And by triple digits I'm meaning 100 million tonnes plus. Is that out of the realm of possibility?
Blair Way: have to be careful when I answer a question like that but certainly the scale of what we're looking at even between CV1 and CV5, there is the potential for something of that scale without a doubt. The drill still has to deliver that and certainly what we're seeing is sending us in that direction and that's one of the reasons of getting up here at site for the winter program. And I'll be here at site for parts of the summer program as well so that I can see it firsthand. Certainly what I'm seeing, and I mean I am literally seeing it today and tomorrow and have been in the core shack for quite a bit of time today, I'm seeing spodumene crystals that are very significant and I'm seeing it repeatedly within the pegmatite.
It's not just the odd crystal here and there, it's very consistent. Which indicates to me it's similar to what we saw in the previous holes that we drilled at CV5 where we got those massive intercepts. The lithology visually looks the same... until we get the assays we don't know for sure but certainly the visual indicators, visual clues if we want to call them that, are telling us that we're seeing the same type of pegmatite and the same type of spodumene crystals and there's the green crystals... the green is more of an altered spodumene whereas the lighter colored, more sparkly... which I've just learned a little bit more about pegmatite and the spodumene today, is showing us just how much we have in some of these holes.
So yeah, certainly the scale is looking very good and as you said this is now rapidly becoming our flagship project because of what we are seeing the drill bit deliver. We'll get this next round of assays and by the time we hit spring breakup as the lake thaws and we have to pull the rig back to shore I think we're going to have something pretty decent to talk about. And then we continue to use the summer drill program to better understand and even delineate it with step outs further in the field so that we can even get a greater understanding of the depth and scale that we have.
Gerardo Del Real: Can you speak to some of your more advanced peers and the kind of tonnage that they have and the market caps that that tonnage is commanding? Because I want to make sure that I provide context for those that maybe didn't understand the story early on when we were trying to explain it or didn't understand the significance of those first few drill holes. We're now starting to see more continuity. We're hoping that the grade holds up. The scale certainly is there if that is the case, but can you speak to some of your peer analogs, their kind of market caps and where they're at as far as it relates to the tonnage in their resource?
Blair Way: Well one of the best analogs for us is Critical Elements and they've got their Rose deposit. Off the top of my head that's somewhere around 25, 26 million tonnes. They have a market cap of $300 million. Those are pretty substantial numbers and that's for 25 million tonnes. So if we are, as we were saying previously, we get into triple digits, that gets pretty substantial.
Frontier Lithium, another company that is Ontario, they've got a couple deposits... one's in the order of 10, 11 and the other is probably around say 25 to 30 million tonnes. Reasonable percentage for that one I think, 1.0%... somewhere around 1.5% give or take and they've got a market cap of $570 odd million, maybe $600 million now because some of these have guys have been going up since I last looked at them.
There definitely is some very similar deposits, sort of styles shall we say, and even scales if we are conservative on how we scale ours and it still shows our market cap of having quite a distance to go. If we can prove into the triple digits as you were alluding to then suddenly at that scale we start becoming pretty significant amongst our peers. We may well be the biggest, but we're not there yet certainly, but the opportunity for the drill to deliver that through this drill program we think is quite high.
Gerardo Del Real: Critical Elements and the Rose deposit is interesting to me. It's a company I've followed for quite some time. Nick Hodge, my partner, did phenomenally well helping finance that early as well, but it's interesting to me because they also have... 1. they're in the same region, 2. they have tantalum as well which is something that's emerging as a big benefit to that Rose deposit and to Critical Elements in the sense that, and they do a very good job of highlighting this, this is conflict free tantalum, which is becoming and emerging more and more as an important theme as to sourcing of these critical metals. And I got to believe with the elevated tantalum grades that we saw recently, you got to be excited about that aspect as well, right?
Blair Way: Absolutely. I mean, it's an economic offset and it's got a market. These are the very things you're looking for. Obviously lithium clearly has a growing market.
The great thing about where we're located, which is dissimilar to some of these other companies we're talking about, is when I'm driving along the road... and there is a road that is adjacent to our property, it's about 15 k's as the crow flies... we drove from Radisson to our camp yesterday. I'm driving along a high voltage power line for the full extent of that road. So we've got clean green, hydro power right here at site. We've got a full year round road right here at site. It's a 15 kilometer connector which is pretty insignificant really.
These are things that suddenly make a project like this once we start defining a proper resource and getting those numbers behind us. Then having clean, green power, having the tantalum offsets, having the road and the infrastructure in order to be able to move spodumene concentrate pretty easily to whatever port or whatever processing facility is ready to handle it. It becomes quite a viable project that has a great deal of appeal because of the associated benefits that I just described.
Gerardo Del Real: It sounds like a region that is ripe for consolidation if you're a major and are looking for some cost offsets where you could come in and write a check or several checks for several of the players in the region that have established resources and companies, of course like Patriot Battery Metals that's working towards that.
When can we expect to start seeing assays, Blair?
Blair Way: We did change labs because we did have some challenges last drill program with labs so this new lab is committed to us. That's SGS. I think we talked about it in a press release. They've committed to turnaround times of four to five weeks. So our expectation is that's what they're going to deliver.
We've started delivering samples to the lab so by the time they actually receive them then they have four to five weeks to turn them around. As far as timing for that, I guess that takes us to sometime in May. So we should start seeing assays in May.
Gerardo Del Real: Excellent Blair. Exciting times. Anything else to add?
Blair Way: No, we've talked a lot. It is really good to be on site and seeing the guys and the progress that we're making at site.
Getting set up obviously now for the winter program which also serves us. There's an economy, a scale of doing a program both in the winter and we don't have to demob anything. And then once the spring breakup comes we roll right back into it so our start up in the spring is even faster than if we start from scratch again.
What we have here is a very clear program laid out in front of us. By the time we get to the fall we're going to have something I think pretty spectacular to talk about and I'm looking forward to advancing through it through this winter program into the summer. Then we will be talking much more clearly about what we know about this particular area between the CV1 and CV5 but also we're going to know so much more about the overall 50 kilometer trend of property and what other outcrops we found and how many more CV5s and CV1s or whatever we'll find on our property to then put the drill to that as well.
So it's an exciting time for the company. There's a lot of excitement in the air with the geos. What they're seeing is making them very interested and engaged into what we're doing here. It's really exciting to be on a project that's this captivating.
Gerardo Del Real: I've spent enough time between Anchorage, Alaska and Chicago in the cold to not want to be there during winter but I am looking forward to being on site hopefully with you during warmer months. Hopefully by then we're starting to get a better sense of the potential scale of what's there, not what could be there as we're talking about it now.
Blair, always a pleasure to have you on. Thank you for that thorough update.
Blair Way: Always great to catch up Gerardo.
Gerardo Del Real: All right, we'll chat soon. Bye now.