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Q2 Metals (TSX-V: QTWO)(OTC: QUEXF) VPE Neil McCallum on Eight New Zones Discovered at the Cisco Lithium Property, James Bay, Quebec, Canada
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the VP of Exploration for Q2 Metals, Mr. Neil McCallum. Neil, it's great to have you back on. How are you today?
Neil McCallum: I'm great, thanks. Looking forward to talking about the news.
Gerardo Del Real: Well, let's get right into it. I know that the lithium equities are going through a bottoming process that's taking a little bit longer than the spot price obviously has, but despite that, the quality teams and the better management teams are going to continue to put out great news and add value irrespective of what's going on in the overall markets. Q2 Metals knocking it out of the park with the Cisco property thus far, you just extended the mineralized zone to 750 meters at Cisco. You're discovering a lot of lithium all over the place. I would love for you to give me the context because I know how excited the team was to get on the ground and you got to be pleased with what you're seeing thus far.
Neil McCallum: Oh, definitely. For sure. So one of the parts that is really exciting for us is every day it's a new story with the drill bit because it was a big question mark in all of our eyes looking at the targeting and the different isolated outcrops. Did these outcrops, did the mineralization continue between them where we don't see any outcrops between. So that is one thing that we are very pleased that we've confirmed that between CO1 and CO3, it seems like we're able to continue those mineralized zones. So we're very happy with that. And now with the latest news release that just came out on the surface sampling, looking at confirming those surface observations of spodumene, we were all pretty sure of ourselves that we had seen the spodumene at surface. But just putting that out into the public, just confirming that just gives us that certainty that we're going to be continuing the trend of drilling to that area that sampled at surface, continuing as we step towards the south. So yeah, we're very excited about what's to come this summer.
Gerardo Del Real: I've repeatedly told speculators and subscribers, shareholders, friends and family that own shares, that anytime I look to write a check to a company, I look for a couple of things. Obviously the team and the share structure. But I definitely want scale and I definitely want grade, right? Everybody talks about grade being king. Well, that's only true because margin is king. And Cisco to me, with these eight new spodumene bearing pigment type discoveries that have been confirmed, you now have 15, I believe, spodumene pegmatite zones at Cisco with grades up to 4.31% and averaging 1.8% from 41 samples. That speaks to scale, that speaks to grade, what comes next as far as defining the potential because this is only a portion of the property that you've been able to get to, right?
Neil McCallum: Oh yeah, that's right. What we've managed to do at surface, I think we've gone maybe a third of the property and I'm more than happy with what we've found so far. If we stopped all the surface work and just kept on drilling, that would keep us very busy for quite some time. However, there's always that discovery potential property wide that I'm excited about and could potentially add value later on. But the biggest story right now is going to be the drilling, and that's what we're working on for the rest of the summer because there's just so much room to go from one outcrop to the next to watch the spodumene bearing pegmatite just continue to come out of the drill bit that we couldn't be more pleased with that.
Gerardo Del Real: How are things with the assay lab this go round? I know last year there were some challenges obviously with a number of just curve balls that Mother Nature threw at us, but how are things looking this year, Neil?
Neil McCallum: Yeah. Things are looking quite a bit more stabilized. I think that labs have expanded their capacity, especially in the James Bay region and the Valdor region, making sure that their prep labs are able to process all this spodumene core. So I'm looking forward to analytical coming out in a timely manner, which they've been pretty good at so far.
Gerardo Del Real: How do you view the disconnect between lithium explorers and developers in North America versus elsewhere? Because I think there's this misconception that the Chinese lithium spot price is the end all, be all of everything, and I keep telling contrarians that this is the time to definitely be adding to the better positions, the better names in the lithium space, especially ones that are in top tier jurisdictions. Can you speak to that a bit? Just taking your Q2 hat off for a second and putting on your contrarian hat, and you've been in this space for quite some time, you've worked in a number of jurisdictions. Can you speak to the North American premium that should come with discoveries of this potential scale?
Neil McCallum: Okay, right. So that's an incredibly good question. I think one of the main factors that people need to think about is the pressure or the need for domestic supply. It seems like every day you turn on the news, there's a new battery plant, electric car vehicle manufacturing in Ontario and Quebec, and they all want to get that material locally. So we're building the downstream and we really need the material for that, and that's going to come from James Bay as far as I can see. The deposits that are being discovered in James Bay are just several tiers above just about anything else in Canada. So there's no sense in getting all that material from South America, from Australia, there's plenty of it here in Canada. So I think even with the new political system that might happen in Canada with the conservative government, that might even launch things even further down the road. So there's a lot of positives in the space. Spot price, you can kind of ignore that because all the fundamentals are there and it's going to cost whatever it costs the miners to produce. And what I see is a bit of a consolidation of the speculating companies with area plays, those are going to dry up and the real good projects are going to survive, and I think it's pretty easy to tell which are the real projects and which aren't by now.
Gerardo Del Real: Couldn't agree more. I got to believe that you believe that Cisco is one of these projects that eventually becomes a mine and helps produce some of those necessary metals, right?
Neil McCallum: Yeah. It's just a matter of time as far as I can see because the intervals, the grade, it's all there so far. So we just need to prove that up and start to build.
Gerardo Del Real: When do we anticipate assays to start trickling back in?
Neil McCallum: Yeah. Within the next few weeks we'll have analytical for the first batch of drill holes, and then we'll be on a fairly regular schedule for the rest of the summer.
Gerardo Del Real: Good stuff. I'm excited for the second half of the year for lithium speculators out there that have been taken to the woodshed here the last 6 to 12 months, me included on a lot of positions.
Neil McCallum: Oh, yeah.
Gerardo Del Real: I highly recommend you do your homework and you take this moment to really, if you can average down, if you're able to add new quality positions, this is absolutely the time to do it. The mid to long-term fundamentals are clear as all day to me, and the temporary lull in prices will sort itself out when sorts itself out, but in the meantime, companies like Q2 that keep adding value are an absolute bargain in my opinion. Anything to add to that?
Neil McCallum: No. I think you've hit it right on, that's exactly what I was thinking. The companies with real projects are going to survive this. I'm not too concerned about it, to be honest.
Gerardo Del Real: Well, looking forward to having you back on. Thank you so much, Neil.
Neil McCallum: All right, take care. Bye.
Gerardo Del Real: All right. Cheers now.
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