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 welcome to CEO insights I'm Marilyn dezman with investing news.com Canadian Mining Company Fortune minerals just reached an important Milestone with a $16.2 million combined funding from the Canadian and the US governments to advance its Nico project in the Northwest Territories joining me to talk about this recent announcement is Fortune minerals president and CEO Robin goat hi Robin hi Marilyn nice to uh to meet you great good to meet you too so obviously let's talk about the important

and uh fascinating news that's uh you just released could you provide us an overview and breakdown of this new funding from the US and Canadian governments and what kind of an impact it will do to your uh ni project and to your shareholders in general right okay so um so project is actually a completely vertically integrated uh critical minerals asset uh very Advanced we've spent 137 million to date but we have a number of uh of improvements that have been made to the project which I can I can discuss uh in a few minutes

but uh we have three critical minerals uh Cobalt Gold uh Cobalt um bsmith and copper as well as more than 1 million ounces of of gold as a highly liquid co-product uh the project being vertically integrated is comprised of a opposed mine and concentrator in the Northwest Territories and we're going to build a hydrometallurgical refinery in Alberta which will process those concentrates to produce value added metals and uh and chemicals so when you ask uh sort of this uh this announcement from the US

government and the Canadian government I uh I think our project ticked a lot of boxes it uh it's a vertically integrated project as we discussed so you have processing it doesn't make a lot of sense to be able to mine and uh make a concentrate here in Canada if we simply ship that material offshore in order to have custody and control and to be able to provide critical minerals for our important energy transition Industries here in North America we need more Downstream processing so that's one of

the things that kind of uh uh I think helped with our uh our application to governments we've also had a lot of Engagement with both the US and the Canadian governments probably for four to five years now but the the US application alone was uh has been in in place for two years and we were an early mover after a program was announced and then uh I think another attractive aspect of our project to the government is the uh relationship we have with Rio tento uh which makes it a crossborder bilateral uh development project which

is aligned with the US Canada collaboration on critical mineral Supply so we uh uh are working with riento they have some waste streams which contain similar metals to what we will uh be producing at our Alberta Refinery and we will be able to increase the production of both Cobalt and bismuth taking the uh intermediates that have been produced from these waist streams and do the downstream processing at the Alberta Refinery I I think one of the most interesting things with this happening with the US and the Canadian

governments is like really it's um solidifying all that that we've been hearing about you know with the government's putting in policies to boost critical mineral Supply domestic uh critical mineral Supply so this is a great example of what really when the government really puts in an investment into a project well you've seen some important announcements even just this week the Biden Administration announced uh significant uh tariffs on Chinese electric vehicles 100% plus uh 25% on

battery materials uh I think the uh the inflation reduction Act is is obviously working uh it's U encouraging investment into North American supplies so that we can kind of decouple from uh from Supply sources that are not necessarily aligned with our Industries uh the uh so the funding that's been announced will will take our project uh and do the sort of the REM filling in all the gaps that are required the remaining permitting and Engineering be able to take this project to a construction decision and uh in

order to qualify us buyers of electric vehicles uh we're going to need liance sources of raw materials with the battery materials coming from North America and we've um we're we've been engaged with even with a number of large companies in Asia that are recognizing this political um sort of trend and are are looking for North American Supply sources right now let's talk a little bit about the Alberta Refinery so you've provided sort of a little bit of a background on that one and your uh

collaboration with Rio Tinto could you maybe expand a little bit for our um you know investor Community who may not be familiar with it like what the plans are for that and really the details of the collaboration with riotinto sure well if we start with the Alberta Refinery we have a beautiful analog with uh with shert uh Sher is operating a refinery in Fort Saskatchewan effectively the same jurisdiction where we plan to construct our Refinery it's been there for 65 years and it's been there much longer than the uh than the

mining uh sources of Supply that were initially uh producing the feed sources for the refineries so having this this Downstream process enables us to to process our materials achieve very good uh metallurgical performance and recoveries uh it also allows us to process custom feed sources like the riento relationship is pursuing and it also allows us to uh to pursue Recycling and we think that recycling is going to be an important source of U of materials in the future so our metals are Cobalt uh we're going to produce a Cobalt

sulfate heptahydrate that is the material that goes into the cathodes of high performance rechargeable batteries we uh we have more than a million ounces of gold and and I'm sure all of your viewers are aware that we're having significant appreciation in the value of gold right now which is important for our project we have the largest deposit of bismuth in the world with 12% of global reserves most of your investors won't be familiar with bouth but it's uh it's used primarily in the automotive

industry but it's also in Pepto-Bismol and the only reason I sort of mentioned that is that it's scientifically recognized as one of the safest metals on the periodic table you can ingest it it has antibacterial properties but but the physical properties are otherwise very similar to lead and one of the uh major expansions in the market is in lead replacement uh creating a um an environmentally safe non-toxic alternative for for uh lead in in uh for example the Alloys used in poble drinking water sources and the US

government has already banned the use of lead in these kinds of Alloys so the brasses and the solders for example uh there's significant use of bismuth in plugging uh decommissioned oil and gas Wells that's a brand new market which is really important because bismuth is one of the very few Metals which expands when cooled so uh when it's uh deployed melted it expands and then fills the paracity and makes a perfect seal preventing greenhouse gas emission so it's a very important metal

environmentally but the wild card that we're all kind of hoping to see uh commercially developed over the next uh couple of years is manganese bis smouth magnets and the US Department of energy has determined that manganese bismuth magnets have better performance lower cost less invasive processing to the environment than Rare Earth elements and again we control 12% of the global reserves of this metal it's already being commercialized by two Korean companies uh a company in the United States as well as uh U there's been

significant interest in our bismi from China but um obviously we're uh we're kind of aligned Now with uh with the North American geographic vertical integration or siloing we want our materials to be mined processed and made available essentially to support North American businesses what about off agreements like uh I you know with the vertical integration I think the missing one of the missing Point Missing Link uh with your vertical integration stat strategy would be you know offtake agreements with uh Manu battery

manufacturers or the end users could you talk about the strategy uh your strategy around that well I can tell you that we could probably uh execute a an off-take agreement with at probably 25 or 30 companies in a microsc but we want to uh have the off take a ailable for strategic Partnerships so the financing plan for our asset after we complete all the engineering and uh and permitting work that's being covered by the the US and Canadian governments is to uh is to seek the project financing which would

probably be a combination of debt but also equity and the equity would be primarily uh um uh related to strategic Partnerships with a user so if somebody like a car company or a battery company or private Equity company wants access to the raw materials that we're going to produce we want to see some money invested in the project so um with this new funding from the governments what are the next steps uh for the Nico and the Alber Refinery could you talk about how that does this change l or you know

speeds up the trajectory of the the timelines for these projects could you talk about the next steps then absolutely so so the first thing we'd like to point out obviously is over the last few years we've had very difficult Capital markets there's been um uh sort of a distraction in in investment into the mining industry well people have looked at cryptocurrencies and pot and stuff like that and I think the uh the attention is now coming back into into the mining sector we've already seen significant price

appreciation in larger companies particularly for the base metals and that is starting to flow downhill into mid tiers and and the larger Juniors like Fortune the uh so what uh this Government funding first of all it's non-dilutive it's uh when we announced this this financing it represented about 50% of our market capitalization and is completely non-dilutive uh effectively grad sord contribution uh funding meaning meaning we we prepay it and then it's reimbursed uh so the uh initially the US Focus was

on addressing gaps to take us to project financing which includes permitting the Alberta Refinery but the municipal planning approvals are already in place because this is a uh is U an existing Brownfield site where that's already been designated for heavy industry and we'll talk about that in a minute as well the um the also we're we're addressing gaps in the engineering so we need an updated feasibility study we have the new Refinery site which is very important we have the u a new Access

Road that's been financed by the government of Canada and the government of the Northwest Territories uh that uh we have optimizations that have been recognized in the mine plan the uh geological model as well as uh as the scheduling of our of our resources trying to reduce Capital costs but also um improving our cash flow scheduling by processing higher value materials or high high margin materials earlier in the M Life so uh going back to the question specifically the US government's funding

an updated feasibility study permiting the Alberta site they're contributing to test work which is already in progress at Lakefield research and it's uh filling in the gaps in the authorizations up in the Northwest Territories where we already have an environmental assessment approval and we have the major mine permits already in place but there are management plans as well as some gaps in the in the permitting that we need to fill the Canadian government came in on the back of the US uh um uh financed U

projects and they're going to finance what's referred to as feed engineering where 30 to 40% of the design or detailed engineering is uh is provided to take the project to the point where you can procure equipment and to give greater cost certainty on the um on the capital costs for project financing uh the Canadian government is also uh contributing to test work which we have in progress with riotinto we're taking those process streams from the kenicott smelter in Utah Rio tento would make an

intermediate they would ship that material up to the Alberta Refinery and then we would do the downstream process to augment our production of both Cobalt and bismuth so the test work needs to demonstrate that we can indeed uh process this material which we're confident we can uh but also what is the impact if we blend it do we have to batch it or do we uh blend it uh and we're pretty confident that uh that we can actually blend it with our materials and uh so that has to be verified and

validated that work is ongoing uh right now as well uh so that's uh coming back to the refinery if I can uh because I not sure if we this was part of the question you had earlier but the Alberta uh economy needs to be Diversified it's highly dependent on the oil and gas industry and we are the natural fit for exactly what's happening there right now the Alberta's industrial Heartland just north of Edmonton is an existing petrochemicals processing area and effectively what we're going to do is

the same thing that's happening there right now except that we're going to produce metals and chemicals from Metals as opposed to to hydrocarbons so everything that we need in that Refinery is readily available within 15 to 20 kilometers there's processed water there's natural gas there's electrical supply there's uh oxygen there's sulfuric acid there's lime all of that in close Pro proximity and there are tax uh incentives keyed to capital investment so it's just the

ideal place to construct this Refinery much better than our previous uh previous option which would have been in in Saskatchewan so really looking forward to uh to U sort of getting that uh process up and running and uh and then addressing the gaps in the engineering in per certainly looking forward to hearing more progress as you advance these two projects thanks again Robin for taking your time and sharing your important news to us today thank you very much and thanks everyone for watching join us again next time for

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