MetalsTech Limited

EverBlu | Research 

27 March 2017 | Gavin Van Der Wath 

MetalsTech Limited Stock Rating Speculative Buy Price Target $0.97 

ASX: MTC 

MetalsTech is a cobalt and lithium explorer with its head office in Perth, Australia and a satellite office in Montreal, 

Canada. The identification of a world-class lithium ore body and subsequent development will be a key driver of 

shareholder value in 2017. We ascribe a share price target of AUD$0.97 based on reasonable expectations of exploration 

success and peer comparison. 

MTC.ASX 

Buy 

Price (as at 4pm AEDT, 27 Mar 2017) 

A$0.25 

Target Price 

A$0.97 

Up/Downside +288% 

52 Week Range A$0.215-$0.335 

Shares Outstanding 

76M 

Market Cap 

A$19.0M 

EV (estimated) 

A$15.0M 

Top 5 Shareholders 

No. % Name 

1 24 Talos Mining Pty Ltd 

2 15 Rachel D'Anna 

3 9 Glenn Griesbach 

4 3 Sarah Cameron 

5 3 Suburban Holdings Pty Ltd 

Price Chart 

A Flying Start 

The company has wasted no time in announcing the start of a drilling campaign 

after highly encouraging results at its flagship, 100%-owned, Cancet Lithium 

Project. A 5-day trenching and sampling programme has been completed on the 

outcropping spodumene-bearing pegmatite over approximately 1km of strike and 

a width of about 16m. 26 samples were collected with half returning grades over 

1.0% Li20 including a high of 5.6% Li2O. The mineralised zones remain open along 

strike and across width. The average value of the samples was 1.47% Li2O which 

is higher than any current major lithium deposit in Quebec. The 4,000m diamond 

core drill program targeting resource definition is expected to result in the 

announcement of a maiden Inferred and potentially Indicated Resource within 6 

months which should lead to a scoping study and subsequent development. The 

Company has also fast-tracked metallurgical test-work with spodumene samples 

from Cancet slated for lithium extraction testing early April. A bulk sample permit 

at Cancet has also been applied for to support larger scale metallurgical analysis. 

Other Positive Project Results To Reinforce Optimism 

Following geochemistry and geophysics activities at the company’s Terre Des 

Montagnes Lithium Project, drilling is expected to follow in Q3 of 2017. The 

project is immediately contiguous with Nemsaka Lithium’s (TSX.V.NMX) fully 

permitted Whabouchi Spodumene Mine boasting an NI 43-101 Resources of 

43.8Mt @ 1.46% Li2O. The mine will produce 213ktpa of 6% concentrate annually 

and NMX has a market capitalisation of approximately CAD$400M. 

High Grade Cobalt Additions 

The company has signed option agreements to acquire 100% of the Bay Lake and 

New Athona Cobalt Projects in neighbouring Ontario, Canada. Located within 

close proximity to the Township of Cobalt, the projects haves reported assays of 

up to an extraordinary 15.36% Co in cobalt rich veins from historical mine shafts. 

The addition would represent a strategic synergy as cobalt and lithium go hand-inhand 

as key inputs in lithium ion batteries. 

Spoilt For Choice 

The Company owns 100% of a further 4 lithium projects: 

- Adina – considered highly prospective and complementary to the 

development of nearby Cancet, drilling to commence end of May 

- Wells Lacourciere – considered moderately to highly prospective, 

sampling and mapping planned for Q3 of 2017 

- Kapiwak – Sampling and mapping planned for Q3 of 2017 

- Sirmac-Clapier - Sampling and mapping planned for Q3 of 2017 

Battery Market Growth Underpins Sentiment 

Increasing political and consumer focus on environmental issues will continue to 

propel demand for non-carbon energy solutions. The automotive industry is 

undergoing a transformative evolution from the internal combustion engine to 

automotive electrification. In addition, lithium ion batteries are now being 

manufactured for use in stationary storage, enabling the use of renewable power 

generation from wind and solar and off-peak charging from the electrical grid. 

EverBlu Research Pty Ltd | Level 39, 88 Phillip Street, Sydney NSW 2000 1 

Email: research@everblucapital.com



Company Overview 

MetalsTech was incorporated on 25 May 2016 for the primary purpose of 

identifying, funding, acquiring, exploring and developing technology focused metals 

projects in Canada. 

MTC is focused on the acquisition, exploration and development within the highly 

prospective lithium regions of Quebec in Canada where a number of prominent 

companies are developing lithium hard rock operations, supplying both lithium 

carbonate (Li2CO3) and lithium hydroxide (LiOH) to a growing market for 

consumption in lithium related technology and products. 

Via a number of completed acquisition agreements, the Company has acquired a 

100% interest in six projects, being: 

- Terre des Montagnes Lithium Project; 

- Adina Lithium Project; 

- Cancet Lithium Project; 

- Wells Lacourciere Lithium Project; 

- Kapiwak Lithium Project; and 

- Sirmac-Clapier Lithium Project. 

FIGURE 1: MTC LITHIUM PROJECTS - LOCATION 

Source: Company Reports 

MTC has also entered into a Technology Partnership Agreement with Lithium 

Australia NL (ASX: LIT) to provide MTC with an exclusive licence to use and apply 

the hydrometallurgical processes developed by LIT throughout Quebec including 

Sileach TM and LieNA TM . 





High grade cobalt project acquisitions 

assay up to an extraordinary 15.36% Co 

MTC recently announced the potential acquisition of two high-grade cobalt projects 

in Ontario, Canada. The purchase remains subject to due diligence, which is due to 

be completed imminently, but is expected to strengthen the Company’s presence in 

the supply of raw materials to the lithium battery market. 

- Bay Lake Cobalt Project: covers 672 Ha and has assayed up to 15.36% Co in 

cobalt-rich veins 

- New Athona Cobalt Project: covers 432 Ha and has assayed up to 2.96% Co 

and up to 2% Cu 

FIGURE 2: MTC COBALT PROJECTS – LOCATION 






We ascribe a A$0.97 price target on 

MTC based on reasonable prospects of 

exploration success and peer 

comparison 

The average EV/resource tonne is 

A$293/t 

We expect confirmation of an Inferred 

and potentially Indicated Resource of 

around 15Mt @ 1.6% Li2O within 6 

months 

Valuation 

Summary 

Our valuation has been based on an expected lithium resource and currently has no 

value included for the potential cobalt acquisitions. 

We have used Enterprise Value (EV) per Li2O resource tonne of peer companies as 

the primary measure of our valuation methodology. Our valuation and share price 

target has been based on a conservative conceptual resource of 15Mt @ 1.6% Li2O. 

This results in an EV of AUD70M at an average peer comparison value of AUD293/t, 

which translates into a market capitalisation of AUD74M after estimated cash of 

AUD4M added. This is equivalent to AUD0.97 per share. The current share price 

represents a discount of 288% to our valuation. We would expect that the discount 

would be eroded steadily over the next twelve months through: 

- Continued exploration success 

- Announcement of an Inferred and potentially Indicated Resource at Cancet 

- Announcement of an Inferred Resource at Adina 

- Completion of a Scoping Study and initiating of a Prefeasibility Study 

- Fast tracking development 

FIGURE 3: COMPANY COMPARISON 

Company JORC/NI-43 101 

Resource 

Pilbara Minerals 

Ltd 

ASX: PLS 

Altura Mining Ltd 

ASX: AJM 

Sayona Mining 

Ltd 

ASX: SYA 

Dakota Minerals 

Ltd 

ASX: DKO 

European Lithium 

Ltd 

ASX: EUR 

156.3Mt @ 1.25% 

Li2O 

39.2Mt @ 1.02% 

Li2O 

13.7Mt @ 1.07% 

Li2O 

10.3Mt @ 1.00% 

Li2O 

6.3Mt @ 1.2% 

Li2O 

Li2O 

(Mt) 

EV (AUD$M) 

EV/Res 

AUD$/tLi2O 

1.95 534 274 

0.40 214 535 

0.15 22 150 

0.10 19 184 

0.08 26 325 

Average 293 

MetalsTech Ltd 

ASX: MTC 

Nemaska Lithium 

Inc 

TSX: NMX 

15.0Mt @ 1.6% 

Li2O 

43.8Mt @ 1.46% 

Li2O 

Source: Company Reports, EverBlu Estimates 

0.24 70 293 

0.64 CAD$412M CAD$644/t 

We have used Pilbara Minerals, Altura Mining, Sayona Mining, Dakota Minerals and 

European Lithium as our principal peers, which are all listed on the ASX. The 

average EV per Li2O resource tonne for this peer group is around AUD$293/t. This 

infers an unrisked EV for MTC of AUD70M. Recent results at Cancet indicate that 

this resource may be validated within 6 months. 

Although we have not used Nemaska Lithium as a peer in the valuation, it is 

interesting to note its current valuation on the Canadian market. 





SWOT Analysis 

Strengths 

High grade lithium identified in predictable hard rock geology 

All projects in Canada - favourable mining jurisdictions 

Low sovereign risk 

North American customers on the doorstep 

Access to some of the lowest cost industrial hydro-electric power in the world 

Experienced management & operational team 

Diversified portfolio of 8 projects 

Opportunities 

Upside in resource estimation 

Opportunity for tantalum credits at Cancet Lithium Project 

Strategic agreement with LIT for hydrometallurgical processing methodology 

Exposure to high grade cobalt 

Increasingly stringent pollution regulations globally 

Electricity grid energy storage 

Lower battery costs driven by research and further efficiencies 

Threats 

Aboriginal rights issues could delay some projects 

Time consuming regulatory conduits 

Substitution of lithium compounds 

Alternate battery technology 

Weaknesses 

Currently no resource estimates 

Low oil price favours incumbent internal combustion engines 





The Lithium Projects 

Summary 

MTC will own 100% of all its lithium projects either directly or through its wholly 

owned subsidiary, LiGeneration. MTC’s main objectives are: 

• fund the maiden drill campaigns at each of the Cancet Lithium Project, 

Adina Lithium Project and parts of the Wells-Lacourciere Lithium Project; 

• fund the ground geochemical survey, airborne electromagnetic and 

geophysical survey at the Terre des Montagnes Lithium Project, and 

subject to further assessment fund a maiden reconnaissance drill 

program; 

• subject to one of more of the initial drilling campaigns being successful, 

fund the cost of a scoping study at one of the high priority projects 

FIGURE 4: MTC LITHIUM PROJECTS – CLAIMS AND SIZE 

Lithium Project 

Number of 

Claims 

Area* (Ha) 

Ownership 

Terre des Montagnes 420 22,458 100% 

Sirmac-Clapier 39 2,130 100% 

Kapiwak 121 6,377 100% 

Adina 57 2,938 100% 

Wells-Lacourciere # 159 9,150 100% 

Cancet 183 9,582 100% 


* Approximate area 

Pegmatite 101 

Canada has an exceptional specialty metal (SM) endowment. More than one 

thousand SM occurrences are reported in Canada, but only a handful are currently 

in production or in an advanced stage of development. Many of the occurrences, 

shown are unlikely to be of economic interest by themselves but their location 

could be used as an indicator of favourable geological conditions. 

Granitic pegmatites are major sources of Ta, Li, Rb, Cs, Be, Sn and a number of 

other industrial mineral commodities. In general, SM-bearing pegmatites and 

aplites, commonly belonging to the Lithium-Cesium- Tantalum (LCT) family of rare 

element pegmatites, are derived from a granitic source to which they are 

geographically and temporally related. Chemical evolution of a Li-rich pegmatite 

group is reflected by enrichment in volatiles, increased fractionation, and 

increased complexity in the zoning of individual pegmatites. Granite pegmatites 

containing lithium minerals occur in the Yellow-knife-Beaulieu district, Northwest 

Territories; the Cat Lake-Winnipeg River, the Herb Lake, and East Braintree-West 

Hawk Lake districts, Manitoba; and the Preissac-Lacorne district, Quebec. 

The bulk of the present lithium reserves in Canada are contained in pegmatite 

bodies that are essentially spodumene-bearing from wall to wall. These bodies are 

typically dyke-like or thinly lenticular in shape. The grade and grain size of the 

spodumene in deposits of this type are remarkably uniform. 





FIGURE 5: LITHIUM OCCURRENCES IN CANADA 


Pegmatites are igneous rocks that form during the final stage of a magma’s 

crystallization. They contain exceptionally large crystals and they sometimes 

contain valuable minerals such as spodumene (a mineral of lithium) and beryl (a 

mineral of beryllium) that are rarely found in economic amounts in other types of 

rocks. Most pegmatites have a composition that is similar to granite with 

abundant quartz, feldspar, and mica. These are usually called granite pegmatites 

to indicate their mineralogical composition. They also can be a source of 

gemstones. Some of the world’s best tourmaline, aquamarine, and topaz deposits 

have been found in pegmatites. Spodumene occurs in lithium-rich granite 

pegmatites which are a defined subset of granite pegmatites but are at the more 

felsic end (S-type) of the granite pegmatite spectrum. 

Large crystals in igneous rocks are usually attributed to a slow rate of 

crystallization. No one universally accepted model of pegmatite genesis has yet 

emerged that satisfactorily explains all the diverse features of granitic pegmatites 

but generally large crystals are attributed to low-viscosity fluids that allow ions to 

be very mobile. 

In the early stages of crystallization, the ions that form high-temperature minerals 

are depleted from the melt. Rare ions that do not participate in the crystallization 

of common rock-forming minerals become concentrated in the melt and in the 

excluded water. These ions can form the rare minerals that are often found in 

pegmatites. Examples are small ions such as lithium and beryllium that form 

spodumene and beryl; or large ions such as tantalum and niobium that form 

minerals such as tantalite and niobite. Rare elements concentrated in large 

crystals make pegmatite a potential source of valuable ore. The extreme 

conditions of crystallization sometimes produce crystals that are several meters in 

length and weigh over one ton. A large crystal of spodumene at the Etta Mine in 

South Dakota was about 13m long, 1.5m in diameter and yielded 90 tons of 

spodumene. 





FIGURE 6: PEGMATITE OCCURENCES IN QUEBEC 

Source: MERN 

The separation of water from magma also often occurs in small pockets along the 

margins of a batholith (a very large igneous intrusion extending to an unknown 

depth in the earth's crust). Pegmatite can also form in fractures that develop on 

the margins of the batholith, forming pegmatite dykes. 

Because these dykes and pockets are small in size, the operations that exploit 

them are also relatively small and may be mined by either underground or open 

cut methods. 





High grade project with near-term 

development opportunity 

Cancet Lithium Project 

Location: 

- 185 km east of La Grande, a full service, regional airport with daily flights 

to Montreal at a duration of 2 hours – pop 1,100 

Access: 

- Bisected by the all seasons Trans Taiga Highway 

- Multiple trails have been installed across the project to facilitate access 

for drilling 

Infrastructure: 

- Power lines cross project area 

Geology: 

- Moderate cover with regular wide spaced outcrops of 2m to 3m by 2m to 

3m in size. 

- Significant volumes of 15 cm to 40 cm long spodumene crystals. 

Previous Exploration: 

- Historic exploration has been undertaken on some of the claims. 

- Over several field campaigns, MTC has confirmed outcropping 

spodumene-bearing pegmatite open across width and along strike 

- Lithium assays completed in August 2016 confirmed the mineralisation of 

the spodumene bearing pegmatites with results including 1.71% Li2O, 

1.85% Li2O, 1.94% Li2O and 3.79% Li2O 

- CH16-01 was 12.8m in length including intervals of 1.71%, 2.35%, 3.08% 

and 4.95% Li2O 

- CH16-02 was 10.6m in length including intervals of 1.19%, 2.11% and 

2.50% Li2O 

- CH16-03 was 4.1m in length including intervals of 1.22%, 2.54%, 3.55% 

and 5.58% Li2O 

- Elevated Ta2O5 across the majority of the identified mineralisation 

- Average Li2O across all channels measured higher than the major lithium 

deposits in Quebec 

- Extensive spodumene-hosted pegmatites have been mapped for in 

excess of 1 km with an average width of approximately 16 m 

Metallurgical Testing 

- The company has fast-tracked metallurgical testing with spodumene 

samples going to the ANSTO laboratory in Australia, in collaboration with 

its technology partner Lithium Australia NL 

- Testing the capability of the LIT-owned Sileach TM lithium extraction and 

processing technology to treat and extract lithium from spodumene 

concentrate derived from Cancet pegmatite 

- Seeking confirmation that under standard operating conditions, Sileach TM 

is able to extract lithium from the Cancet spodumene concentrate and 

achieve a representative >90% Li extraction from bench scale testing 

Proposed Exploration: 

- Phase 1 Drilling has commenced with diamond core drilling testing the 

strike, dip, and plunge continuity of several already identified pegmatite 

outcrops, believed to be part of a large contiguous high grade lithium ore 

body which is accessible from surface. 

- Fifty (50) individual drill sites from which a proposed two-phase drilling 

campaign is to be completed. 

- Phase 1 includes twenty (20) diamond core holes for approximately 

4,000m which will be drilled over a period of approximately six (6) weeks 

- The company has stated it will update stakeholders iteratively with 





respect to both visual estimates of spodumene content when drill core is 

produced (a strong leading indicator of lithium content) and secondly 

when Li2O results are received following ultimate core analysis and 

laboratory assay 

- The balance of the proposed drill holes will be completed in Phase 2 

which will commence during the spring-summer period once the results 

of Phase 1 drilling have been modelled and following the completion of a 

regional geochemical survey and a regional ground-based magnetic 

survey 

- A map identifying the proposed drill site locations for the two-phase 

diamond core drilling campaign is outlined in Figure 7 

- The campaign has been designed in such a way to target the primary 

outcrops and outline the contiguous nature of the ore body 

Subsequent ground based exploration and drilling will then be able to 

target extensions of this lithium rich ore body in three directions, being 

along strike, down dip and laterally down hole 

FIGURE 7: CANCET LITHIUM PROJECT – DRILL PLAN 


A recent channel sampling program at Cancet yielded assays of up to 5.58% Li2O as 

well as elevated Ta2O5 across the majority of the identified mineralisation. 

The average value from all samples collected was 1.47% Li2O which is higher than 

the current major lithium deposits in Quebec. 





FIGURE 8: MAJOR LITHIUM DEPOSITS IN QUEBEC 

Nemaska Lithium (TSX:NMX) Whabouchi Deposit 43.8Mt @ 1.46% Li2O 

Galaxy Resources (ASX:GXY) James Bay Deposit 22.2Mt @ 1.28% Li2O 

Sayona Mining (ASX:SYA) Authier Deposit 13.75Mt @ 1.06% Li2O 

Critical Elements Corp (TSX- 

V:CRE) 


Rose Deposit 

37.2Mt @ 0.95% Li2O 

Cancet is located in the eastern Superior Geological Province. The age of these 

rocks varies from 2600 Ma to 3400 Ma and they have been deformed by the 

Kenoran orogeny, between 2660 and 2720 Ma. The La Grande and Opinaca 

subprovinces are intruded by Proterozoic gabbro dykes. The La Grande 

subprovince is a volcano-plutonic assemblage composed of an ancient tonalitic 

gneiss (2788–3360 Ma) of the ‘Langelier Complex’ and many volcano sedimentary 

sequences from the Guyer Group (2820 Ma). The Guyer Group is composed of 

tholeiitic basalts, komatiites, calc-alkaline felsic tuffs, turbidites, iron formations 

and many ultramafic to felsic intrusions. A north western Ontario equivalent to 

these rocks are those of the Sachigo-Uchi-Wabigoon subprovinces. 

The Opinaca subprovince is a metasedimentary and plutonic sequence similar to 

the English River and Quetico subprovinces in Ontario. The age of these rocks 

(



Adjacent to one of the highest grade 

and largest lithium deposits globally 

Terre des Montagnes Lithium Project 

Location: 

- 4 properties surrounding the Nemaska Lithium Inc. Whabouchi 

Spodumene Mine 

o Terre des Montagnes Project, previously known as Whabouchi East. 

o Terre des Montagnes Southeast Project previously known as 

Whabouchi Southeast. 

o Terre des Montagnes Southeast Extension Project previously known 

o 

Southeast Whabouchi. 

Terre des Montagnes Southwest Project previously known as 

Whabouchi Southwest. 

- Within 45 km east of the Cree nation settlement of Nemaska, close to the 

Nemiscau regional full service airport 

- Approximately 300 km north-northeast by road of the town of 

Chibougamau – pop 7,500 

- All properties are located adjacent or very close to the Nemaska 

Lithium’s, Whabouchi Spodumene Mine and Hydromet Plant Project 

Access: 

- Access by road 


- Airport ~20km away 

- Hydro-Quebec has several facilities in the area 

Geology: 

- Presence of basalt and/or amphibolite remnants in a gneissic formation 

intruded by granites 

- Geological formations and, like all the rocks of this area with the 

exception of the pegmatites, are strongly deformed. 

- Numerous localized topographic highs can be attributed to late intrusions 

of leucogranites and biotite-bearing white pegmatites 


- MERN completed a geological survey in 1975 

- Electromagnetic surveys identified several electromagnetic and magnetic 

trends which might indicate a lens of massive sulphide along a geological 

contact – no follow-up recorded 

- The Nemaska Lithium Inc. Whabouchi Spodumene Mine is located 

approximately 1.7 km southwest of the Terre des Montagnes property 

- In mid-2016 various pegmatite outcrops were identified and sampled and 

anomalous mineral values 


- Phase 1 ground based electromagnetic survey (3 properties) - Cost 

CAD$0.24M. 

- Phase 2 to consist of trenching, outcrop sampling and exploration 

diamond drilling to establish an understanding of the geology at depth. 

Independent of Phase 1 (3 properties) – Cost CAD$1M 





FIGURE 10: TERRE DES MONTAGNES LITHIUM PROJECT FEATURES 

Complementary exploration project to 

nearby Cancet Lithium Project 


Adina Lithium Project 

Location: 

- 350 km east of La Grande – pop 1,100 

Access: 

- Helicopter supported exploration, with an established field camp at the 

Mirage Lodge, located less than 20 minutes by helicopter 


- Approximately 60km from major road and power 

- Mirage Lodge is located less than 20 minutes away by helicopter, which is 

full service to support exploration activities and field crew 

Geology: 

- Quebec government conducted regional surface mapping in 2014 

indicating a continuous zone of pegmatites 

- Field work indicates this is not the case, as there are rafts of country rock, 

metavolcanics and metasediments present indicating pegmatites are 

discontinuous and / or the geological contact between the pegmatites 

and the interbedded ultramafics might not be well known. 


- August 2016 - verify the presence of low grade green blue spodumene 

bearing pegmatites reported in the 2014 Quebec government regional 

mapping campaign. 

- Work on the ground included a 1 km traverse to locate and sample 

pegmatite outcrops. Eleven samples of spodumene bearing pegmatite 

were collected from several pegmatite outcrops. The outcrops were 

measured at approximately 680 m in length over an area of 200 m in 

width. 

- Assay results of the eleven chip samples confirm the presence of the 

spodumene bearing pegmatite dykes range of 0.24% to 3.12% Li2O with 7 

samples of eleven above 1.0% Li2O 


- Phase 1 exploration will consist of an initial four to five drill holes at 200m 

length, drilled along strike of the sampled outcrop. Cost – CAD$0.35M 

- Phase 2 will involve project scale mapping, sampling and trenching – Cost 

CAD$0.11M 





FIGURE 11: ADINA LITHIUM PROJECT GEOLOGY 

No exploration planned in near future 

but M&A opportunities exist 


Kapiwak Lithium Project 

Location: 

- 2 properties (Kapiwak North and Kapiwak South) 

- 10 km south of the Eastman River 

- 100 km east of James Bay 

- 510 km northwest of Chibougamau – pop 7,500 

Access: 

- Access by road but remote 


- Minimal 

- Located north and south of the Galaxy Resources Limited (ASX: GXY) 

James Bay Lithium Deposit which hosts a JORC Resource of 22.2Mt @ 

1.28% Li2O 

Geology: 

- Paragneisses (Auclair Formation), probably of sedimentary origin, which 

surround pegmatites from the north-west to the southeaster extremities. 

- Amphibolite dykes and ultramafic intrusions have been identified 

throughout this unit as well, with a prominent diabase dyke striking 

north-south through the centre of the project. 


- During mapping in 1978 observed white coarse grained tourmaline and 

muscovite pegmatites. 

- Spodumene was observed in 2011 in 10 cm to 30 cm sized “boulders” – 

source unknown as no outcrop. 

- 6 samples were collected and assayed from the boulders 

- All samples were positive for lithium with assays of 0.84 - 2.9% Li2O 

- Levels of beryllium, tantalum and niobium were also elevated. 

- In 2011 a helicopter-borne aeromagnetic geophysical survey identified 

conductive structures across the project. 

- Adjacent to James Bay Lithium Pegmatite Project (Galaxy Resources 

Limited ASX: GXY) 


- Early stage exploration project. 

- Field mapping and ground truthing to take place in Q3 of 2017 

- No current exploration targets. 





FIGURE 12: KAPIWAK (NORTH AND SOUTH) LITHIUM PROJECT GEOLOGY 

No exploration planned in near future 

but M&A opportunities exist 


Sirmac-Clapier Lithium Project 

Location: 

- Lac Assinica section of the region of James Bay 

- 105 km northwest of Chibougamau – pop 7,500 

Access: 

- Access by road for most of the year 

- Located along strike of the Nemaska Lithium Inc. 100% owned Sirmac 

Lithium Project and the Lac Clapier-Nord Lithium Outcrop, also owned 

100% by Nemaska Lithium Inc. 


- Limited – maintained camp situated 25km away 

Geology: 

- Mainly quartzite sandstone with a dyke of dioritic to gabbroic 

composition occurring at its southern most edge 

- Glaciation has carved ridges and hills from northeast to southwest. 


- No recent exploration work including drilling has been undertaken. 

- No lithium mineralisation has been identified 

- 3 km east of the main zone of lithium mineralisation at Nemaska Lithium 

Inc. Sirmac Property 


- Early stage exploration project. 

- Field mapping and ground truthing to take place in Q3 of 2017 

- No current exploration targets. 





FIGURE 13: SIRMAC-CLAPIER LITHIUM PROJECT GEOLOGY 

Moderate to highly prospective 


Wells-Lacourciere Lithium Project 

Location: 

- 35 km west by road of the town of Malartic – pop 3,500. 

- 60 km west by road of the town of Val-d’Or – pop 32,000 

Access: 

- Predominantly sealed road from Val-d’Or 

- Well maintained logging roads 


- A CN rail line and a Hydro-Quebec power line run near the project. 

Geology: 

- The pegmatite dyke at the Wells-Lacourciere occurrence outcrops in a 

large hill of granite and strikes 310° and dips steeply to the north. 

- Traceable along surface for a distance of about 600 metres and width 

varies from 8 to 15m 

- Spodumene in this dyke occurs as large, stubby crystals in random 

orientation 

- Overburden thickness varies between 0 to 35 metres 


- Spodumene mineralisation first documented in 1955 by MERN geologists 

in a pegmatite dyke outcrop. 

- Contains a 200m2 excavation site containing high grade lithium from bulk 

samples of 2.87% to 4.0% Li20 

- 1 sample located assayed at 7.0% Li2O. 

- In June 2016 grab samples were collected from multiple locations and 

large spodumene crystals were observed. 


- Phase 1 exploration would include project scale mapping, sampling and 

trenching – Cost CAD$0.16M 

- Phase 2 exploration would include approximately 2,000 m of diamond 

drilling for 10 to 15 drill holes targeted at known anomalies independent 

of Phase 1 – Cost CAD$0.45M 





FIGURE 14: WELLS-LACOURCIERE LITHIUM PROJECT GEOLOGY 






The Cobalt Projects 

Summary 

MTC has announced that it has entered into two binding option agreements to 

acquire a 100% interest in the New Athona Cobalt Project and the Bay Lake Cobalt 

Project, both located near the town of Cobalt in Ontario, Canada. The agreements 

generally each have the following conditions: 

• cash deposit of CAD$20,000 (paid); 

• 45 day due diligence period; 

• cash completion payment of CAD$80,000; 

• share completion payment of 125,000 MTC shares; 

• NSR 1.5%; 

• 6 month anniversary share payment of 100,000 MTC shares; and 

• project performance payment (>7Mt @ 1.5% Co resource) CAD$125,000 

in cash or MTC shares. 

FIGURE 15: MTC COBALT PROJECTS – CLAIMS AND SIZE 

Cobalt Projects 

Number of 

Units 

Area (Ha) 

Ownership* 

New Athona 1,082 432 100% 

Bay Lake 672 100% 


* Subject to due diligence 

The Cobalt area is an established Tier-1 mining district, with extensive road, rail 

and port infrastructure, able to target future production to key North American, 

and export markets. The district is a proven mining region with over 600Moz Ag 

and 45Mlbs of Co production from previous operating mines. Much of this silver 

was extracted in early 1900’s, with minimal focus on Co or on high-grade Co 

regions, which were typically left behind or used as a tracer to track silver. 

We have taken the liberty of identifying listed ASX peer companies which are 

tabulated below. Many of the projects mentioned are also polymetallic deposits 

and as such cobalt cannot be evaluated in isolation. Due diligence still needs to be 

completed on the MTC properties. Assuming the purchase is concluded, more 

exploration is required in order not only to delineate an orebody, but also to 

assess tonnages and grades. 

FIGURE 16: COBALT PEER COMPANIES 

Company JORC/NI-43 101 

Resource 

Equator 

Resources Ltd 

ASX: EQU 

Nzuri Ltd 

ASX: NZC 

Barra Resources 

Ltd 

ASX: BAR 

Corazon Mining 

Ltd 

ASX: CZN 

- 

7Mt @ 0.6% Co 

32Mt @ 0.6% Co 

- 

Location 

Cobalt Camp Projects 

Ontario, Canada 

Kalongwe, 

DR Congo 

Mt Thirsty 

Norseman, WA 

Mt Gillmore, 

North-East NSW 

Mkt Cap 

(AUDM) 

93 

54 

42 

38 





Cobalt Blue Ltd 

ASX: COB 

Conica Ltd 

ASX: CNJ 

33Mt @ 0.08% Co 

32Mt @ 0.13% Co 

Riva Resources 

Ltd 

- 

ASX: RIR 

Alloy Resources 

Ltd 

- 

ASX: AYR 

Celsius Resources 

Ltd 

- 

ASX: CLA 

Berkut Minerals 

Ltd 

- 

ASX: BMT 

Hammer Metals 

Ltd 

6Mt @ 0.1% Co 

ASX: HMX 

Cohiba Ltd 

ASX: CHK - 

Thakaringa, 

Broken Hill, NSW 

Mt Thirsty, 

Norseman, WA 

Tabac Project, 

Western Australia 

Ophara Project, 

Broken Hill, NSW 

Opuwo, 

Namibia 

Kobald Mineral Projects, 

Scandinavia 

Milenium Projects, 

North-West QLD 

Cobalt X, 

Mt Isa, QLD 

32 

21 

19 

12 

11 

11 

10 

7 


Source: Company Reports, EverBlu Estimates 

New Athona Cobalt Project 

Location: 

- 35 km south of the town of Cobalt – pop 1,100. 

- 10 km north east of the town of Temagami – pop 800 

- The project is bordered north and east by claims held by Tri-Origin 

Exploration Limited 

Access: 

- Access to project is granted by a combination of paved roads and offsurface 

tracks 


- Approximately 60km southwest of the town of Cobalt and only 10km 

west of the Silver Centre Mining area within the Cobalt Mining Camp in 

Ontario, Canada 

Geology: 

- The eastern portion of the project is underlain by Coleman formation 

conglomerates of the lower part of the Huronian Super Group and 

Nipissing Diabase Sill gabbro 

- The western portion of the project is underlain by Archean rhyolitic 

volcanic rocks and Archean grabbroic intrusive rocks mineralised on 

surface with veins containing semi-massive sulphides 


- Veins containing pyrite, pyrrhotite, chalcopyrite and sphalerite returning 

values, from surface rock samples, of Cobalt 2.96%, 0.94% and 0.14% 

respectively and Copper of up to 2%. 

Proposed Exploration (subject to due diligence): 

- Conduct an airborne EM survey; 

- Conduct an IP survey; and 

- Complete a drilling program targeted for mid-2017 following detailed first 

phase data analysis. 





FIGURE 17: NEW ATHONA PROPERTY 



Bay Lake Cobalt Project 

Location: 

- 15 km west of the town of Cobalt– pop 1,100. 

- 60 km west by road of the town of Temiskaming Shores – pop 10,000 

- 5 km North-North-West of Equator Resources Limited (ASX: EQU), the 

owner of the Cobalt Camp Project 

Access: 

- Access to project is granted by a combination of paved roads and offsurface 

tracks 


- Located less than 10 km south-south-west of the Historic Silver Mining 

Camp of the Cobalt Township on the eastern shore of Bay Lake in 

Coleman Township, Ontario, Canada 

Geology: 

- Majority of historical work was completed in 1913 by the Bay Lake and 

Montreal River Mining Company and included six (6) shafts in Nipissing 

diabase and extensive stripping of the Nipissing diabase-Lorrain sediment 

contact 

- Several Calcite veins occur within the lowest part of a Nipissing diabase 

sill near the contact with arkoses of the Lorrain Formation 


- The majority of historical work was completed in 1913 by the Bay Lake 

and Montreal River Mining Company and included 6 shafts in Nipissing 





diabase and extensive stripping of the Nipissing diabase-Lorrain sediment 

contact. 

- Sub-surface rock samples taken from a cobaltite-rich vein on the 27m 

level produced assays including 15.36% Co, 15.29% Co, 14.31% Co and 

15.27% Co 

- Historical reports indicate substantial cobalt grades in silver ore however 

the project’s cobalt potential remains untested – cobalt was used as a 

tracer for silver mineralisation but not targeted in its own right. 

Proposed Exploration (subject to due diligence): 

- Conduct an airborne EM survey; 

- Conduct an IP survey; and 

- Complete a drilling program targeted for mid-2017 following detailed first 

phase data analysis. 

FIGURE 18: BAY LAKE COBALT PROPERTY 






The Sileach TM Process 

The Agreement 

On 11 October 2016, MTC entered into a Technology Partnership Agreement (TPA) 

with LIT in relation to the use and application of two proprietary hydrometallurgical 

processing technologies (Sileach TM and LieNA TM ) owned and developed by LIT, as 

well as any other lithium processing or lithium related technology that is owned, 

developed, acquired or patented by LIT in the future. 

The Licence will grant MTC the exclusive right to use the licensed technology for 

any project owned or for any ore originating from a project within Quebec. 

LIT will be entitled to receive a royalty of 2% of gross revenue derived by MTC from 

selling all products that were beneficiated using the technology in addition to the 

issue of 5M shares and 3M options in MTC on achievement of performance 

milestones. 

FIGURE 19: THE SILEACH TM PROCESS 


Milestones 

Milestones achieved: 

- Completion Payment: 1M shares on execution of TPA and MTC listing 

Future milestones (based on spodumene provided by MTC and sourced from one of 

the projects and the use of the licensed technology to produce lithium carbonate 

and/or lithium hydroxide on cost competitive terms): 

- Proof of Concept: 0.5M shares on achieving representative >90% Li 

extraction from bench scale tests. 

- Quality Tests: 0.5M shares on LIT achieving representative >95% Li2CO3 

purity from leach liquors 

- Pilot Tests: 1M shares and 0.5M options achieving representative 

extraction >90% Li recovery and >85% from leach liquor, in a continuous 

pilot plant operation. 

- Scoping Study: 1M shares and 0.5M options on MTC delivering a scoping 

study on one of the projects. 





- Definitive Feasibility Study: 1M shares and 0.5M options on MTC delivering 

a definitive feasibility study. 

- Offtake: 0.5M options execution of a binding offtake agreement(s) for the 

supply of >5,000tpa. 

- Commencement of Plant Construction: 0.5M options on commissioning 

construction of a full-scale processing plant. 

- First Commercial Production: 0.5M options on achieving first commercial 

production and sales of lithium carbonate and/or lithium hydroxide. 

The shares issued to LIT will be escrowed for 24 months from the date of issue and 

the options will have an exercise date of 3 years from issue with an exercise price 

that is a 30% premium to the 5 day VWAP calculated for the 5 days prior to the 

milestone achievement produced at any of the projects. 

Agreement Rationale 

The Sileach TM process is still undergoing pilot testing in Australia. An engineering 

study to build a large-scale pilot plant is currently underway and completion is 

expected by mid 2017, at which stage we expect a commitment to be made to its 

construction. The partnership with LIT and the use and application of the Sileach TM 

hydrometallurgical processing technology could allow MTC to achieve its goal to 

establish a low-cost lithium production profile, similar to that of the brine 

producers. 

FIGURE 20: TARGET HYDROMETALLURGICAL PROCESS COST 

Source: Company Reports, Deutsche Bank 

It is expected that collaboration with LIT will ensure the following benefits to MTC: 

- Further development of the ore extraction technology specific to the 

spodumene at the MTC projects. 

- Fast-track the development and process for the production of lithium 

carbonate and lithium hydroxide from the spodumene concentrate. 

- Generate a well-designed flow sheet designed to maximise the recovery of 

the lithium from the spodumene concentrate. 

- Enhance the potential economics of the production of lithium products. 





- Provide the necessary parameters to ensure that the sampling of the 

spodumene and the design criteria of the hydrometallurgical processes for 

the production of lithium carbonate and lithium hydroxide are aligned. 

- Improve the rate at which MTC is able to demonstrate its ability to 

produce value add lithium products. 

- Remain in a cost competitive environment within the lowest quartile of 

the cost curve. 





Quebec Mining Regulatory Regime 

Introduction 

The Mining Act governs the registration of mining rights in Québec. The Ministère 

de l'Énergie et des Ressources naturelles (MERN) is responsible for the 

administration of the Mining Act, including its Public Register where records and 

maps which indicate the location and status of mining rights are kept and made 

accessible online. 

The mission of the Ministère de l'Énergie et des Ressources naturelles (MERN) is to 

promote knowledge acquisition and to ensure the development and optimal use of 

energy, land and mineral resources in Québec from a sustainable development 

perspective, for the benefit of the entire population. 

Québec's mining rights system is based on a first come first served basis. The 

mining rights conferred by the Mining Act are immovable real rights divided in two 

categories: 

- exploration rights; and 

- extraction rights. 

Québec’s strength lies not only in its raw materials, but also in the quality of its 

labour pool, training institutions and specialist research centres. In addition, it is a 

world leader in the capture and processing of geoscientific data. The Fraser 

Institute has regularly ranked the province in the top ten in the world for its 

favourable mining environment, based mainly on its mining policies and mineral 

potential. 

Exploration Rights 

The claim gives the holder an exclusive right to search for mineral substances in the 

public domain, except sand, gravel, clay and other loose deposits, on the land 

subjected to the claim. 

A claim can be obtained: 

- by map designation, the principal method for acquiring a claim; or 

- by staking on lands that have been designated for this purpose. 

The term of a claim is two years. It can be renewed indefinitely, provided the claim 

holder meets the conditions stipulated in the Mining Act, including the carrying out 

of exploration work, the nature and amount of which is established by regulation. 

Mining Lease 

To obtain a mining lease, a claim holder must first establish the existence of 

indicators showing the presence of a workable deposit, and must submit a report 

certified by an engineer who is a member of the Ordre des ingénieurs du Québec or 

a geologist who is a member of the Ordre des géologues du Québec, describing the 

nature, extent and probable value of the deposit, as well as a project feasibility 

study and a scoping and market study about processing in Québec. 

Mining lease applicants must provide the MERN, at its request, with any document 

and information relating to the mining project. The MERN may subject the mining 

lease to conditions designed to avoid conflicts with other uses of the territory. 

When entering into the lease, the Government may, on reasonable grounds, 

require maximization of the economic spinoffs, within Québec, of mining the 

mineral resources under the lease. 





A mining lease will be granted only when: 

- the rehabilitation and restoration plan has been approved; 

- the certificate of authorization in accordance with the Environment 

Quality Act has been issued; and 

- the project’s survey plan has been formalized by the Office of the 

Surveyor-General of Québec. 

The initial term of the lease is 20 years. The lease may then be renewed no more 

than three times for a period of 10 years each time. After the third renewal, it may 

be renewed for periods of five years. 

Mining Tax Regime 

The purpose of the mining tax regime is: 

- to obtain fair profitability for the State without compromising the ability of 

operators to compete; 

- to stimulate mineral exploration and mining activities; 

- to encourage development in Northern Québec; 

- to promote processing and conversion in Québec. 

A new mining tax calculation method for operators applies to every tax year 

beginning after December 31, 2013. An operator is required to pay the higher of 

the following two amounts: 

- A minimum mining tax based on the well head value of output, at the 

following rates: 

o 1% on the first $80 million 

o 4% on the remainder 

- Mining tax on the annual profit, at a graduated rate ranging from 16% to 

28%, depending on the operator’s profit margin. 

Well head value is established as follows is defined as the gross value of the mine’s 

annual output minus: 

- Expenses incurred in respect of the mine that are reasonably attributable 

to crushing, milling, sieving, processing, handling, transportation or 

storage of the mineral substance derived from the main, from its first site 

of accumulation after leaving the mine and, where applicable, processing 

products obtained and marketing activities for the mineral substance, 

including general and administrative expenses relating to these activities. 

- The depreciation allowance (goods used from the first site of 

accumulation). 

- The processing allowance (the same as that deducted when calculating the 

annual profit from the mine). 

To encourage mining investment, companies that process ore in Québec can 

benefit from an allowance based on the cost of the assets used for ore processing. 

This allowance corresponds to: 

- 10% for a mining company that engages in concentration; 

- 10% for a mining company that processes ore from a gold or silver mine; 

- 13% for a mining company that engages in smelting or refining outside 

Québec; 

- 20% for a mining company that engages in smelting or refining in Québec. 

Other fiscal incentives exist for eligible mining corporations that incur qualified 

exploration expenses in Québec. 





Aboriginal Issues 

General 

Canadian courts have established a duty to consult with Aboriginal Peoples on 

decisions that may impact land and resources subject to aboriginal claims. In 

practice, however, there is a lack of clarity on who is consulting, how much 

consultation is required, and when this requirement has been satisfied. This lack of 

clarity has led to frustration on the part of both mining companies and aboriginal 

groups, in some cases delaying projects that are in the interest of both groups. 

The Canadian constitution recognizes three groups of Aboriginal Peoples: First 

Nations, Métis, and Inuit. In Canada, the government [usually the provincial 

government] is obliged to consult with and perhaps accommodate aboriginal 

groups if there is a prospect that aboriginal or treaty rights will be affected by a 

resource development authorized by government. The obligation to consult and 

accommodate was affirmed by the Supreme Court of Canada in landmark decisions. 

Third parties, such as mining companies, do not have a legal obligation to consult 

aboriginal groups and the ultimate responsibility for consultation and 

accommodation rests with the government. 

The government is able to delegate aspects of consultation to mining companies. 

The federal government in its decision-making process can use information 

collected during consultation. However, the ultimate responsibility for consultation 

and accommodation rests with the government. Consultation responsibilities may 

also be delegated to mining companies as part of a provincial or a federal 

environmental assessment process. 

While mining companies are not legally obliged to consult with aboriginal groups, it 

is often preferable for them to be active in the process. Mining companies have a 

vested interest in the consultation process since their project may be at risk if 

consultation is inadequate. Court decisions have disallowed private companies 

from relying on existing provincial authorization where the consultation process 

was deemed inadequate. 

By consulting with aboriginal groups early on, mining companies can also help build 

good relationships, share necessary information, and reduce the risk of future 

challenges to government decisions. Creating good relationships with aboriginal 

groups can help mines attract a motivated workforce after mining operations begin. 

Mining companies face a growing skill and labour shortage and aboriginal workers 

can help fill this need. Aboriginal communities can also benefit from the 

employment, training and economic growth opportunities of mining. 

Project Specific 

The Projects appear to be mainly located on Cree Territory - referred to as Eeyou 

Istchee-James Bay Territory - south of the 55th parallel as delimited by the James 

Bay and Northern Québec Agreement (JBNQA) signed in 1975 by Grand Council of 

the Crees of Québec and the federal and provincial governments. 

This agreement remains the most important element of the First Nations 

landscape. It settled all claims of native people relating to ownership, fishing, 

hunting and trapping in the territory. Treaty Rights replaced the aboriginal rights 

claimed by the Cree Nation as defined in the JBNQA in order to clarify and secure a 

legal framework that would allow the use of the resources of the territory for the 

benefit of all Quebecois and the protection of the way of life of the native people 

concerned. 

On February 7, 2002, the Québec Government and the Crees signed another 

important agreement dubbed as the “Paix des Braves”. This fifty-year agreement is 

of a political and economic nature. Its goal is to favour the beginning of new 





relations between the parties based on cooperation to achieve the full 

development of the territory and ensure autonomy and increased management by 

the Crees of their own development while respecting the principles of sustainable 

development and the traditional way of life of the Crees. A final agreement giving 

effect to “La Paix des Braves” was signed on July 24, 2012 (the 2012 Agreement). 

These agreements have been implemented by legislation. A special land regime 

applies to the Eeyou Istchee-James Bay Territory. A specific environmental 

protection regime included in the Environment Quality Act ensures special 

participation by the Crees to environment assessments by way of consultation and 

representation mechanisms. 

A Cree Regional Authority created in application of the JBNQA and designated as 

Cree Nation Government by the 2012 Agreement has jurisdiction over Category II 

Lands notably with respect to management of natural resources. But the 2012 

Agreement specifically stipulates that third parties interests such as permits, leases, 

mining claims, etc. existing on Category II Lands as of the date of coming into force 

of the agreement are maintained in accordance with applicable laws. 

All mineral substances other than surface mineral substances contained in the lands 

remain part of the domain of the provincial government but the MERN is 

responsible for the application of the Mining Act and must take into account the 

Cree communities’ rights and concerns when exercising powers to authorize 

exploration or exploitation of minerals. 

There are three main categories of lands on Eeyou Istchee-James Bay Territory: 

- Category I Lands: lands surrounding villages set aside for the exclusive use 

and benefit of the Crees; 

- Category II Lands: public lands on which the Crees have exclusive hunting, 

fishing and trapping rights; 

- Category III Lands: public lands with non-exclusive rights to the Crees for 

hunting, fishing and trapping without a permit subject to the conservation 

principle but no exclusive rights. 

On Category I Lands, the consent of the Cree Community concerned is required for 

any mining exploration or exploitation. 

On Category II Lands, no project may be authorized without prior consultation with 

the Crees. Furthermore, if the project is to interfere substantially with the Crees’ 

exclusive rights to fish, hunt or trap in the area, a compensation must be 

determined. The 2012 Agreement also provides that Québec shall notify monthly 

the Cree National Government, the Cree Mineral Exploration Board and the 

relevant Cree communities of the grant of mining claims on Category II Lands and 

provide the Crees with all the information on mineral activity on Category II Lands. 

On Category III Lands, the agreements also require a prior consultation with the 

relevant Cree community before any authorization is granted. Furthermore, the 

Cree Nation Government has the authority to devise territorial development plans 

and adopt plans of land use and development that apply on Category III Lands. 

Those regulations must be taken into account in any decision in relation to mining 

activities as well as other resources uses. 

The tables below indicate the proportion of active claims (not the surface area) 

affected by the different categories of land with regards to each project, as well as 

other limitations affecting the claims. 





Project 

Number of 

Claims 

FIGURE 21: PROJECT CATEGORIES AND LIMITATIONS 

Area* (Ha) Category of Lands Other Limitations 

I II III 

Terre des Montagnes 143 7,655 - 78.3 % 36.4 % - 

Sirmac-Clapier 39 2,130 - - 100% Park Assinica Project (10 claims) 

Kapiwak South 40 2,112 - - 100% Power Line (4 claims) 

Kapiwak North 81 4,270 - - 100% Power Line (12 claims) 

Adina 57 2,938 - - 100% - 

Terre des Montagnes 

Southeast 


Southwest 

45 2,400 - - 100% Hydroelectric Installation (18 claims) 

163 9,302 - - 100% Hydroelectric Installation (25 claims) 

Power Line (2 claims) 


58 3,048 - - 100% - 

Southeast Extension 


11 588 - - 100% - 

Southwest Extension 

Wells-Lacourciere # 135 7,769 - - - - 

Wells-Lacourciere 

14 802 - - - - 

Northwest Extension # 

Cancet 187 9,585 - - 100% Hydroelectric Installation (109 claims) 


*Approximate area 

# 

Located in municipality of Rouyn-Noranda and not subject to Category of Lands 

Other Limitations 

In terms of the Mining Act, the MERN may reserve to the State or withdraw from 

prospecting, exploration and mining operations any mineral substance forming part 

of the domain of the State and required for any purpose it considers to be in the 

public interest, in particular for: 

- the creation of parks or protected areas; 

- conservation of vegetation and wildlife; 

- development and utilization of water power, power transmission lines, 

storage tanks or underground reservoirs; 

- protection of eskers that may be a source of drinking water; 

- compliance with protection areas established under the Groundwater 

Catchment 

- Regulation; 

- protection of rehabilitation and restoration work carried out in 

accumulation areas; and 

- classification as an exceptional forest ecosystem or designation of 

biological refuge status under the Sustainable Forest Development Act. 

MERN may also impose conditions and requirements on a claim holder relating to 

work to be performed on the parcel of land. 





Directors and Management 

Board of Directors 

MTC has two Canadian-based independent directors. The company will seek to 

appoint additional suitably qualified non-executive directors as the projects are 

advanced. Appropriate management is also expected to be employed when 

required. 

Mr Russell Moran – Executive Chairman 

Mr Moran is a co-founder and Executive Chairman of the Company. He is an 

experienced natural resources and technology investor with focusing on bulk 

commodities, base metals and mining and engineering services sectors. He is the 

Founder and former Executive Director of Canadian anthracite mine developer 

Atrum Coal (ASX: ATU) and has significant experience in Canadian exploration and 

resource development. 

Mr Moran is currently Chairman of Oceanic Dental Pty Ltd and 3G Coal NL, and 

Non-Executive Director K2 Technology Pty Ltd and K2fly Limited (ASX: K2F). 

Mr Gino D’Anna – Executive Director 

Mr D’Anna is a founder and Executive Director of the Company. Mr D’Anna has 

significant primary and secondary capital markets experience and has extensive 

experience in resource exploration, public company operations and administration 

and financial management. Mr D’Anna has particular experience in Canadian 

Government and First Nations relations in the mining sector. Mr D’Anna was a 

founding shareholder and founding Executive Director of Atrum Coal (ASX: ATU) 

which is developing the Groundhog Anthracite Project, located in British Columbia, 

Canada. 

Mr D’Anna is currently a Director of 3G Coal NL, Non-Executive Director of Metals 

Australia Limited (ASX: MLS) and K2fly Limited (ASX: K2F) and Director of Lac 

Grande Gold Pty Ltd. 

Mr Shane Uren - Independent Director 

Mr Uren is a Registered Professional Biologist in British Columbia with a Masters in 

Civil Engineering. He has extensive Environmental Assessment experience including; 

BHPs Ekati Diamond Mine, Cambior's Rosebel Mine, Inco Ltd.'s Goro Project, 

Novagold's Galore Creek Project, Thompson Creek Metal's Davidson Project, Atrum 

Coal’s Groundhog Project and Copper Fox Metal’s Schaft Creek Mine. 

Mr Michael Velletta – Independent Director 

Mr Velletta has more than 20 years’ experience in corporate law, building public 

companies, mergers and acquisitions, financing and corporate governance. He is a 

Director of MNP Petroleum (TSX.V:MNP), African Metals Corporation (TSX.V:AFR) 

and privately held gold exploration companies. He is a member of the Association 

of International Petroleum Negotiators, the Law Society of British Columbia and 

past governor of the Trial Lawyers Association of British Columbia. 





Shareholders 

FIGURE 22: TOP SHAREHOLDERS 

Rank Name Shares % 

1 Talos Mining Pty Ltd ATF Talos Mining Trust 17,914,000 23.60% 

2 Rachel D'Anna 11,716,000 15.40% 

3* Glenn Griesbach 6,900,000 9.10% 

4 Sarah Cameron 2,250,000 3.00% 

5 Suburban Holdings Pty Ltd (Suburban Super 

2,250,000 3.00% 

Fund) 

6 Lithium Australia NL 2,000,000 2.60% 

7* John Moran 1,950,000 2.60% 

8 J P Morgan Nom Aust Ltd 1,385,000 1.80% 

9 Tets Pty Ltd 1,350,000 1.80% 

10 Chifley Portfolios Pty Ltd 1,210,000 1.60% 

11 Pheakes Pty Ltd (Senate Account) 1,020,000 1.30% 

12 Keith and Penny Huxtable (Huxtable Super 

Fund) 

960,000 1.30% 

13* Jason Peterson 800,000 1.10% 

14 Gregory M and LM Pinkus (Pinkus Family Super 

Fund) 

700,000 0.90% 

15 Samantha Moran 600,000 0.80% 

16 Mandalay Mining Pty Ltd ATF Hudson Ave 

Investment Trust 

600,000 0.80% 

17 Dorel Oran Raphael 500,000 0.70% 

18 Resourserve Pty Ltd (Hamlyn Super Fund) 384,000 0.50% 

19 Ryan Kalt 375,000 0.50% 

20 Fairborn Holdings Pty Ltd 375,000 0.50% 

Top Shareholders 55,239,000 72.6% 

Source: Company Reports (*denotes merged holding) 





Appendix 1 

Lithium in its high grade form is rare and 

highest energy density of any metal and 

………. 

……. has a broad range of uses from 

energy storage to pharmaceuticals 

The Lithium Market 

Background 

Lithium (chemical symbol: Li) is soft and silvery white and it is the least dense of the 

metals. It is highly reactive, does not occur freely in nature and is contained within 

stable minerals in a range of hard rock types or in solution in brine bodies within 

salt lakes (salars), in seawater or geothermal brines. The contained concentration of 

lithium is generally low and there are only a limited number of known resources 

where lithium can be economically extracted. 

Lithium’s high electrochemical potential makes it the standard material for lithiumion 

(high energy-density rechargeable) batteries. Lithium ion batteries generally 

have a very high efficiency, typically in the range of 95% - 98%. Nearly any discharge 

time from seconds to weeks can be realized, which makes them a flexible and 

universal storage technology. 

Lithium can be processed to form a variety of different chemicals depending on its 

end use. Lithium carbonate represents approximately half of the total global 

consumption of lithium chemicals. The next most common chemical is lithium 

hydroxide, which represents 16% of total global consumption. Other forms of 

lithium consumed include lithium bromide, lithium chloride and lithium minerals. 

Uses are: 

- As lithium carbonate, it’s a pharmaceutical. It’s been prescribed for 

conditions such as manic depression and bipolar disorder. It acts on the 

nervous system, and can modify your actions and behaviour. 

- It is also used as an alloy mixed with aluminium, so that it can strengthen 

aircraft. This alloy can also be used for high-speed trains and high quality 

bicycle frames. 

- Alloyed with magnesium, it is used to make armour plating. 

- It is used as lithium oxide in glass ceramics and special glasses. 

- It is also used as a desiccant in air conditioning systems, as lithium bromide 

and lithium chloride. 

- As lithium stearate (grease), it is used as an all-purpose lubricant although 

it is especially ideal for high temperatures. 

- And as lithium hydride, it can store hydrogen so it can be used as fuel. 

Industry has divided product specification into 3 broad categories: 

- Industrial grade (+96% Li) - glass, casting powders and greases. 

- Technical grade (~99.5% Li) - ceramics, greases and batteries. 

- Battery grade (>99.5% Li) - high end battery cathode materials 

Lithium and lithium compounds are often measured in terms of Lithium Carbonate 

Equivalent (LCE) but other measures such as lithium hydroxide (LiOH), lithium oxide 

(Li2O) and lithium metal (Li) are also used. The following table summarises 

conversion factors between the compounds. 





Current demand is estimated at 160kt 

LCE with most market commentators 

expecting annual growth around 10% 

FIGURE 23: LITHIUM CONVERSION FACTORS 

Convert from 

Convert to Li 

Convert to Convert to 

Li2O 

Li2CO3 

Lithium Li 1.00 2.15 5.32 

Lithium Oxide Li2O 0.46 1.00 2.47 

Lithium Carbonate Li2CO3 0.19 0.40 1.00 


Demand 

The consumption of lithium has experienced exceptional growth with the overall 

market more than doubling in just twelve years from 2000. Market demand for 

lithium products is largely driven by the increase in use of rechargeable batteries in 

portable electronic devices and electric transportation. Lithium-ion batteries 

provide power for cell phones, smartphones, tablets, laptop computers, power 

tools, and many other mobile consumer devices. Larger format lithium-ion batteries 

provide power for electric cars, scooter, electric bikes, buses, forklifts and other 

forms of transportation. New applications for lithium are emerging in the areas of 

grid energy storage, solar and nuclear energy generation, and other industrial uses. 

Current demand is estimated at 160kt LCE with most market commentators 

expecting annual growth around 10% 

FIGURE 24: GLOBAL LITHIUM CONSUMPTION (2012-2017) 

Battery demand currently dominates 

lithium demand 

Source: Roskill – Lithium Market Outlook to 2017 

EVs are likely to provide explosive 

growth 

In the automotive sector, the advent of lithium-ion hybrids (HEV), plug-in hybrids 

(PHEV) and fully electric vehicles (EV) require large format batteries. These 

batteries will require kilos of lithium, rather than the grams used today in portable 

electronic applications. 

Electric vehicles can be grouped into three main categories: 

- Hybrid Electric Vehicles (HEV): Capable of storing charge (usually only in 

small amounts). Do not plug into an electric outlet, but instead are 

recharged by a separate internal combustion engine which is the principal 

power source (e.g. Toyota Prius). HEVs consume approximately 0.5-2.0 kg 

Li per vehicle. 

- Plug-in Hybrid Electric Vehicles (PHEV): Have both electric and 

conventional motors, but are distinct from HEVs in that they can be 

recharged from an electric outlet via a plug (e.g. Chevy Volt). PHEVs 

consume approximately 1.8-4.2 kg Li per vehicle. 





Government incentive programs and the 

drive for lower carbon emissions will 

underpin demand 

Car companies are rushing to construct 

battery production capacity in 

anticipation of EV demand 

- Electric Vehicles (EV): Fully electric vehicles that do not contain a 

combustion engine. Their battery packs and driving ranges between 

recharges tend to be much larger than other EVs since they do not have 

auxiliary power sources such as an internal combustion engine. Example: 

Tesla Model S. EVs consume approximately 10-20 kg Li per vehicle. 

While portable consumer goods alone continue to provide impressive growth in 

demand for lithium batteries, the start of mass production of hybrid, plug-in hybrid 

and electric vehicles presents the most significant upside “step growth” potential 

for lithium demand. 

Given the increasing political and consumer focus on environmental consciousness, 

auto manufacturers are striving to lower both carbon emissions and fuel 

consumption in transport applications. In 2013 alone the number of electric vehicle 

models grew from 11 to 17 with a wide range of consumer choices offered by all 

the major global automotive brands. Electric vehicle options range from the zippycity-drive 

Nissan Leaf to the long-range sporty performance of the Tesla Model-S. 

Determining the future growth in electric vehicles is difficult to predict and there 

are a wide range of forecasts as to the number of electric vehicles that will be on 

the road within the next decade and the resultant additional potential lithium 

consumption requirement. However, there has been a large number of government 

incentive programs, globally, recently announced to advance the development, 

production and use of HEVs, PHEVs, and EVs. Despite near-term uncertainty as to 

the growth of lithium-ion batteries in the electric vehicle segment, we believe the 

increasing drive for lower carbon emissions by governments and consumers, 

significant investments by a number of parties globally in new battery technology 

for transport applications, and technology improvements within car manufacturers 

themselves, will provide significant future demand growth for lithium. 

According to Goldman Sachs lithium demand for all EV applications could grow 

more than 11x by 2025, adding more than 310,000mt of LCE demand. This 

compares to current EV demand that represents only 27,000mt of LCE (17% of the 

current overall lithium market). In short, growth in EV applications alone could 

triple the size of the entire lithium market from 160kt today to 470kt by 2025. 

Tesla exclusively makes electric cars powered by rechargeable batteries, and the 

company has just released its latest model – at a much lower price point than its 

previous models (US$35,000) – and already has 400,000 orders for the car. The 

company says it will build 500,000 cars a year by 2018, a massive ramp up from its 

existing production levels of 80,000 to 90,000 cars a year. By 2020, CEO Elon Musk 

says the company is aiming for one million cars. 

Several others are rushing to compete with Tesla, and all will require rechargeable 

batteries. Many countries in Europe are leading the world in uptake of EVs using 

lithium-ion batteries, with EVs already totalling 22% of all new vehicle sales in 

Norway. Lithium-ion batteries are already being produced in Europe to meet this 

increasing demand, and production capacity in car-producing countries such as 

Germany is growing dramatically to keep up, with Daimler recently announcing a 

new €500M battery factory, and Volkswagen likely to soon follow suit. Samsung SDI 

has announced a lithium battery plant in Hungary, Nissan in the UK, Tesla a 

Gigafactory 2 in Europe whilst Jaguar Land Rover, Ford and BMW are studying a 

joint lithium battery factory in Europe. In addition to batteries for EV’s there is 

growing understanding that Europe’s drive towards increase use of renewables 

requires fixed energy storage and that lithium batteries can be an important 

component of this which will further increase battery and lithium demand. Battery 

producers will need more supply from safe, nearby jurisdictions. Sourcing lithium 

from Europe would also reduce the carbon footprint of the car production supply 

chain. 





The lithium oligopoly poses a challenge 

for EV and battery producers 

Supply 

Commercial lithium production currently comes from two sources: 

- Brines: lithium rich brines from salt lakes, or salars; and 

- Minerals: pegmatite rock deposits containing lithium-bearing minerals. 

The process of producing lithium from brines is generally much lower cost than that 

from hard rock minerals but capital costs tend to be higher. 

Nearly one-half of the world’s lithium production comes from lithium brines in the 

Andes mountains region. In the mid-1990s, the development of these large-scale, 

low-cost brine resources in Chile and Argentina by SQM, Albermarle and FMC 

Global fundamentally changed global lithium supply. With its cost advantage over 

mineral-based production, brine producers lowered prices to gain market share, 

resulting in closure of mineral conversion plants in the USA, Russia and China. 

Hard rock supply is dominated by Australia’s Greenbushes mine owned by Talison 

Lithium supplying close to 40% of market requirements. Talison is hardly an 

independent, being 49 percent-owned by Albemarle and 51 percent by China's 

Tianqi Lithium, which takes an increasing amount of the mine's output for 

processing in China. Talison has recently announced that it is proceeding with a 

lithium hydroxide plant in Western Australia supplied by concentrate from 

Greenbushes. 

Current global production of lithium is also highly concentrated, both 

geographically and in corporate ownership. We estimate that about 85% of world 

production comes from Chile (Sociedad de Quimica Minera de Chile SA (SQM) and 

Albermarle), Argentina (FMC Corp), and Australia (Talison Lithium). 

This oligopoly poses a real challenge for EV and battery producers. Interestingly 

Tesla seems to placing its faith in the new generation of producers. In Europe we 

would expect Daimler, VW and the like to also support new suppliers of lithium 

with particular focus on European producers, placing EUR in a strong position. 

Pricing 

There are a number of problems when looking at pricing. The first is the 

bewildering number of products that can be made from lithium, ranging from 

lithium stearate (industrial grease) to lithium fluoride (aluminium smelting) to 

butyllithium (organic compounds). 

All are normally converted for pricing into lithium carbonate, largely used for 

battery manufacture. 





FIGURE 25: LCE PRICNG FORECASTS 

If lithium is going to become an integral 

part of the global energy supply chain, 

its market opacity is a big problem. 

Source: Orocobre, Deutsche Bank, Canaccord 

Lithium pricing is extraordinarily 

opaque…………. 

……….but prices are on the rise. 

But even then the picture is complex. There are different types of carbonate, with 

lower-grade material for the ceramics and glass industries, while higher-grade 

material is used in batteries. Nor are lithium-ion batteries themselves homogenous. 

There are five major types, each using a different lithium compound. 

The second problem with lithium pricing is that most trade is conducted between a 

small number of producers and their customers. There is no exchange trading, no 

terminal storage market and only an extremely limited spot market and prices vary 

by product, consumer and contract types. This means that price assessments from 

commentators rely on published trade volumes and trade values, or contacts within 

industry. This is made more difficult by the complexity of the lithium product chain. 

Either way prices are on the rise. CRU reports that battery grade material is trading 

at more than USD$20,000/t on the Chinese spot market. It is believed that new 

contract prices for battery grade material exceed USD$7,000/t. Prices for lithium 

concentrates used for conversion into chemicals are correlated to, and tend to 

follow the same trend as, lithium carbonate prices. 





Appendix 2 

Cobalt is considered a ‘technology 

enabling’ metal 

The Cobalt Market 

Background 

Cobalt is considered a ‘technology enabling’ substance as it is at the forefront of 

technological developments and innovation. In pure form, cobalt is silvery-blue 

and brittle. It is similar to iron and nickel, and, like iron, can be made magnetic. The 

only stable isotope of cobalt is Co-59. 

Ancient origins aside, cobalt itself was not discovered until the 1730s when 

Swedish scientist George Brandt pulled an unknown metal out of some ore from 

the Riddarhyttan mines of Sweden. 

Brandt described the metal and its properties, including its magnetism. The 

discovery was controversial, and even in 1760, Brandt was still defending the find 

in a talk at the Academy of Science. Fellow Swedish scientist Torbern Bergman 

would eventually conduct further study to confirm Brandt's findings in 1780, 

according to a 2011 article in Nature Chemistry. 

Demand 

Lithium cobalt oxide (LiCoO2) is widely used in lithium ion battery cathodes. The 

material is composed of cobalt oxide layers in which the lithium is intercalated. 

During discharge, the lithium is released as lithium ions. Nickel-cadmium (NiCd) 

and nickel metal hydride (NiMH) batteries also include cobalt to improve the 

oxidation of nickel in the battery. 

Cobalt-based superalloys consume a large proportion of produced cobalt. The 

temperature stability of these alloys makes them suitable for turbine blades for 

gas turbines and jet aircraft engines. Cobalt-based alloys are also corrosion and 

wear-resistant, making them (along with titanium) useful in medical orthopaedic 

implants that do not wear down over time. 

A manmade isotope, Cobalt-60, is commonly used in cancer treatments; the 

gamma radiation released by this radioactive isotope can target tumours, 

particularly brain tumours that need precision treatment. 

FIGURE 26: GLOBAL COBALT DEMAND FORECAST BY APPLICATION 

Batteries and alloys remain major 

demand 

Source: ResearchInChina 





The DRC dominates mined supply 

Supply 

In terms of supply, two countries that present significant supply side concerns for 

Western companies dominate the cobalt market. The Democratic Republic of 

Congo (DRC), a politically unstable country, is responsible for 65 percent of cobalt 

mine production, and China is responsible for over 50 percent of refined cobalt 

production. 

Cobalt is typically mined as a low-grade by-product of copper or nickel. With nickel 

and copper prices under pressure and forecast to remain weak this by-product is 

an uncertain and reduced source of supply. 

There has also been considerable pressure from major electronics companies to 

secure their raw materials from ethical sources, and reduce materials from 

artisanal mines associated with child labour and human rights abuses. ‘Clean’ 

jurisdictions such as Canada are expected to benefit from this supply-chain shift. 

FIGURE 27: COBALT SUPPLY 

Country 

‘000 Mt 

DRC 66.0 

China 7.7 

Canada 7.3 

Russia 6.2 

Australia 5.1 

Zambia 4.6 

Cuba 4.2 

Philippines 3.5 

Madagascar 3.3 

New Caledonia 3.3 

Source: USGS 

Pricing 

For the past four decades, cobalt metal has typically traded between USD$15/lb 

and USD$30/lb, only dipping below USD$10/lb briefly, and occasionally spiking to 

the USD$50/lb level when serious supply issues arise 

FIGURE 28: GLOBAL COBALT MARKET BALANCE & PRICING FORECAST 

Source: ResearchInChina 

The LME started trading cobalt in 2010 although the London Metal Bulletin free 

market quotation remains the main price reference. This has recently risen to 

above USD$20/lb. Batteries and superalloys together with supply issues are likely 

to persist for some time giving impetus to prices. 





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