Antimony Is A Strategic Metal That Is Critical For The Defense Industry & The West Doesn't Have Much
Antimony is growing in importance as a strategic metal that is sought after in the West, the US government just made its biggest ever investment to put an antimony mine in Idaho back into production
Today, China controls most of the world's antimony supply, including midstream refining and processing. The EU, US, Canada, and UK have listed antimony as a critical raw material, acknowledging its importance for economic security and technological advancement.
Military Metals (CSE:MILI, OTC: MILIF) is 100% focused on antimony as an explorer and developer. MILI is one of the few pure play antimony mining equities in the world today. I recently had the opportunity to speak with Military Metals President & CEO Scott Eldridge.
Goldfinger
Good afternoon. I'm speaking with Scott Eldridge, CEO of Military Metals. The symbol is M-I-L-I on the CSE.
Millie is a company focused on antimony, a strategic metal of growing importance across the globe today. Scott's going to tell us why we should care about antimony. Scott, how are you?
Scott Eldridge
I'm excellent, Robert. It's great to be here and I hope you're doing well.
Goldfinger
Tell us about the company and what you guys are doing right now.
Scott Eldridge
Military Metals, as you said, we're a publicly listed company on three exchanges, the CSE, the Frankfurt Exchange in Germany, and then OTCQB in the US. We are a company that is 100% focused on antimony as an explorer and developer. We're one of the very few pure antimony plays that exist out there for investors to get exposure to antimony.
Between the Canadian and the Aussie companies, you can count those on one hand in terms of what are the pure play opportunities for investors to get exposure to antimony because it's not an exchange-traded metal. There's no futures contracts. There's no ETFs.
The only way to get exposure is pure play through the mining equities.
Goldfinger
Antimony is a metal that has hit the headlines here in 2024. The ore is called stibnite, but antimony is the metal that is used in applications for the armed forces, actually in power plants as well. China and the US and Russia have been in a tit-for-tat with sanctions on this metal.
Can you tell us about that?
Scott Eldridge
It just so happens that by pure chance or by Mother Nature geology, China controls the vast majority of antimony deposits. In addition to that, they also control the midstream. All of the smelting and refining for any of these specialty metals is very important because at the mine site of a mine that would produce antimony, you would only be able to concentrate it to between 60% and 70% and then you're producing a con.
That's not an end product. The midstream smelting and refining is very important. China has built that out for antimony along with about 20 other minerals.
That means that the Western world is very reliant on China for the needs of these specialty or minor metals, if you want to call them that. Antimony experienced something on September 15th that people are probably aware of where China announced an export restriction, which is effectively a ban because there's basically no antimony coming out of China right now. That's put the Western world in a spiral here, trying to find solutions to where can we source antimony for the US and for Europe.
We're in a bit of a panic mode here and we're trying to play catch up to China. We don't see this
in only antimony, but we see it in the other minor metals as well.
The supply of antimony is concentrated in just a few countries and that makes it vulnerable. How much do we have in the West, like in Canada, in the US?
Scott Eldridge
Yeah, that's a great approach to start from the supply side. If we look at where are the majority of the world's antimony reserves, they're concentrated in China, Russia and Tajikistan. Those three countries combined have just over 80% of the antimony mining reserves.
China, as I said, has at least 50% of the refining capacity. If we look over to the West, the largest producer of antimony today is the Costerfield mine in Australia that's owned by Mandalay. They produce antimony as a by-product.
There's very few global primary antimony mines. It's mostly a by-product of gold mines, not all gold mines, but a few gold mines that carry antimony as a by-product.
Goldfinger
Antimony is used in tank rounds to pierce armors, as well as tungsten. Those two metals are very important for that. It's used in weaponry.
It's also used to harden lead in bullets. Solar panels, battery technology, pretty extensive kinds of applications. Can you tell us more about that?
Scott Eldridge
Right. It's obviously classified as a strategic critical mineral. It's used in almost all applications from a military aspect.
You named a few. Ammunition and armor-piercing bullets, flame retardants for soldiers' uniforms and tents, night vision goggles, laser sighting, ammunition primers, flares. It's used to alloy tungsten for tanks.
It's not just ammunition. It's very widely used in the military sense. Why is that important?
We've almost been in a de-stocking phase from a defense perspective in Europe and the US. The inventories are at very cautionary low levels. We're now in a period of increased geopolitical and military activity around the world where everyone is on high alert.
We need to restock. We need the inventory. We need to flex our muscles and show that we're powerful.
On the other hand, we've now seen a spike in the antimony price that further exacerbates that need for the West to source antimony, where we've seen the price go from about $10,000 a ton to now $38,000 a ton in Europe in the last two years. There's a bit of a scramble here to find that precious supply of antimony. There's basically no substitutes for antimony for any of these military applications.
Of course, you have the renewable energy side that you mentioned. It's used in the glass for solar panels. It's used in building nuclear power plants.
It's not a one-trick pony. There's four or five significant demand applications for antimony. It's not just the defense sector.
Goldfinger
You say there's a scramble for it in the West. Does the West have any?
Scott Eldridge
Another good question. As of now, there is no antimony production in the Western world other than that mine in Australia that I mentioned. That's a byproduct.
That's not a significant amount of production. The U.S. government is taking matters into their own hands and they're stepping up. They're moving towards a significant financial commitment to a company called Perpetua Resources (NYSE:PPTA).
They have a gold antimony project in Idaho called Stibnite. They're looking at a financial commitment there of about $1.86 billion. That's the most significant amount of money the U.S. government has ever put towards a mine. This project will certainly support the U.S.'s domestic antimony needs. It won't come online until 2029 from what I've heard. Furthermore, it would only be about 30% of the domestic needs for the U.S. This is not the be-all, end-all solution. It's certainly not happening tomorrow. The antimony grade on this gold mine is 0.07%. There's a massive amount of capital going towards this project for that precious antimony that's going to be produced here as a byproduct. This is unprecedented.
We haven't seen this before.
Goldfinger
There's a real shock going on right now. There's a scramble to find more antimony in the West. There's not a whole lot of sources available.
We know the mining timeline to advance a project from a new discovery or even from the resource stage through the feasibility stage through the permitting stage takes many years. To be honest, six or seven years is an optimistic timeline for most projects. Stibnite, the one that you mentioned, that was a previously operating mine there in Idaho for many decades.
It shut down due to environmental problems. Now it's coming back due to the support of the federal government, which is a real game changer. As you said, that's the biggest investment the U.S. has ever made in a mine. It's a gold and Stibnite mine, but I guarantee you the federal government is not supporting it for the gold. That really tells you a lot about how the game has changed.
Scott Eldridge
Correct. Absolutely. That's why when we put our portfolio projects together, we wanted to look at not pure greenfield opportunities that had an outcrop discovery.
We wanted to look at past producing mines just like the Stibnite project in Idaho. Brownfield projects offer many benefits over greenfield, particularly in timelines. In terms of what we've acquired in our portfolio, we have one project in Nevada, one in Canada, and then two antimony projects over in Slovakia.
They would all fall under the category of being brownfields projects, which means we will have an opportunity to fast track them. We'd like to advance them as quick as possible to take advantage of the current opportunity.
Goldfinger
Let's talk about the projects the company has acquired. You guys have been busy here the last few weeks.
I'm just going through some of the news that you put out here this month. You acquired the project near Round Mountain. Let's talk about that.
Then let's talk about the Slovakian projects.
Scott Eldridge
Round Mountain would probably be third on our list. That is a small-scale project. Nevada is one of the best mining jurisdictions in the world, as everyone knows.
This project saw small-scale production going back during World War I. When there was a peak in antimony demand. This is an early-stage opportunity.
We need to get in there and drill this project and prove out an NI 43-101 resource in order to move that forward. Higher up on the list would be our West Gore project in Canada. This was a larger-scale mine that saw production during World War I.
They fed that concentrate over to the UK to support the Allied war efforts over in Europe. It's got an interesting history to it. The demise of the project was when one of the concentrate shipments was actually sunk by a German U-boat.
An interesting little story there. This was a past-producing underground mine. They were mining from three different levels.
The old mine now is flooded. What we need to do is dewater the mine. Then we would like to drill from underground.
We know from looking at the old records that the entire resource or reserve was not exploited. There's still antimony in that deposit. It's also open along strike.
It's open at depth as well. We've also increased the land package to be larger than what the previous operation held. We now control the entire geological opportunity in that area, in Nova Scotia.
Over in Europe, I'll talk about our flagship asset called Trojarova. It's located in Slovakia, which is a member of the European Union. This is a very interesting project because there was a Soviet era resource drilled out here, but the mine was never actually put in production.
There's no questions surrounding how much was taken out of here, how much of this resource was exploited, because the answer is zero. There's an opportunity for us to take advantage of the existing infrastructure. There's an adit there excavated into the hillside where you can walk in underground and you can start to see the mineralized area of the stibnite veins.
The value of that historical work is probably $12 to $15 million in today's dollar value terms. Even more importantly, as I alluded to earlier, it's the timeline. That work would have taken us two to three years to conduct today.
That gives us an opportunity to fast-track this project and help service Europe for their antimony needs in the EU.
Goldfinger
The Trojarova project in Slovakia, Scott, I'm just looking at the news release you put out on November 16th. I see there's a table in here showing a few alternatives for what this deposit or this ore body could look like. If you use a 1% stibnite cutoff, your average grade is 2.5% antimony and 0.64 grams per tonne gold. That's almost 2.5 million tonnes. When I'm looking at the antimony price right now, let's just say ballpark $10 a pound, it might be higher, it might be a little lower, but it's around there. 2.5%, if I think about copper deposits, average 0.5% and copper is $4 a pound. 2.5% seems pretty extraordinary.
Scott Eldridge
It is. Just to give you some background, we saw this storm brewing in antimony going back about 7 months. Again, what I've said before is that we targeted brownfield opportunities and we wanted to focus on projects that had a higher grade of antimony to gold ratio.
We've talked about other projects around the world where they're sort of the opposite of higher grade gold with antimony by-products. Ours is the flip-flop of that. We actually have higher grade antimony with lower grade gold, which is very unique from a geological perspective.
There's not a lot of these around the world. With that higher grade antimony at about 2.5%, again, this is a historical resource from the Soviet era. They were known for doing very good work.
Our geologists are now going through this information and we're getting very positive confirmations here. We do need to convert this to NI43-101 standards, which we'll do over the next few months here. We're very confident that this work will hold valid.
Our calculations with the current antimony and gold prices are that we probably have $600 to $700 rock here. This is most likely an underground operation, not an open pit, so small environmental footprint, which is more beneficial. The rock value per ton here is very very robust and this would classify this amongst some of the most economically robust mines in the world at these grades and current metals prices.
Goldfinger
The NI43-101 resource is expected by the spring, would you say?
Scott Eldridge
Yes, that's accurate. What we need to do is go back and confirm a lot of the drill core QAQC protocols. It's important to keep in mind that this project had 15,000 meters worth of diamond drilling conducted on it to come up with this resource calculation.
That's a significant amount of historical work and it was very fortuitous that we were able to acquire this asset.
Goldfinger
It seems like a very good asset. Is that all you need to do is just go to the core that already exists and get confirmation of the grades or do you need to put a core rig in there yourself and do some confirmation holes?
Scott Eldridge
Yes, that's a good question. We're just doing a gap analysis right now and the short version would be that we look at all the drill core which we have access to and we would have to twin some holes and if the assay results on the twin holes are plus or minus 10 percent of the historic results, then we can get credit for the entire suite of the 15,000 meters worth of drilling.
Goldfinger
Okay, very good. Tell me about Slovakia. I don't know much about the country. I know it's in the EU. It's in the Eurozone. It obviously was formerly part of the Soviet Union. Can you tell us more about that and what is mining like in Slovakia?
Scott Eldridge
Slovakia joined the EU in 2004. They've been a member for quite a while and they're fully adopted
and they use the Euro currency. Myself, I used to live in Hungary so I used to take the train up to Bratislava once in a while to visit the old town.
It's a very nice place to visit if you're ever in Europe and you want to look at something off the beaten path. Again, full-blown member of the EU and something we haven't yet talked about is that in Europe, they've adopted their own version of the Inflation Reduction Act that we see here in the US. In Europe, it's called the Critical Raw Materials Act.
This applies to all member states and it has many benefits to the mining industry where Europe, just like the US, wants to foster its own domestic production. One thing that sets Europe apart is they've actually put a fast-track permitting process in place for projects that qualify. We most certainly would because Antimony is on Europe's critical mineral list just like it is in the US.
There's an opportunity here to fast-track the program. We've also been approached by a significant number of EU-sponsored funds, whether it be grants, equity investment, project finance loans. We're already having those discussions, even though it's a bit premature.
There's a lot of interest in what we're doing here. I actually visited Slovakia for the first time about 12 years ago. I went there to visit a silver-copper historical mine that actually had an antimony by-product to it in Central Slovakia.
I've been learning about antimony for the last 12 years and visited the country on and off. It's definitely a good place to do business, combined with the support of the European Union. That's great.
Goldfinger
Can you tell us about your background?
Scott Eldridge
I've been in the business now for 17 years, various buy-side, sell-side, and issuer roles. I've always been in financial roles and I've probably raised now over $300 million for various mining companies. I have been exposed to Europe before, working in Lithium.
I've also developed companies that have been bought out. Amarillo Gold was a company we developed in Brazil and wound up selling that to Hochschild. I've been through that development of a junior project with an ultimate sale and exit for the shareholders for a win.
That's the recipe we'd like to replicate here at Military Metals.
Goldfinger
Can you tell us a little bit about the share structure, the current cash, and who are some of the largest shareholders?
Scott Eldridge
Issued and outstanding right now is about 54 million shares. Fully diluted, we would be at about 81 million shares. There are outstanding warrants in the company that are all in the money significantly.
They're held by people that we would consider close to the deal. Our collective group, we control about 30% of the company. We're all in this for the long term, looking for a multi-dollar stock here.
We do have about C$2.8 million in the bank right now in Canadian cash. Upon full exercise of the warrants that are in the money, that would bring in another C$4.4 million into the treasury. We're in a good position right now.
We don't need to raise money.
Goldfinger
News flow over the coming months. You guys have been busy the last few weeks. Obviously, you announced the Slovakian projects, the Round Mountain projects.
You're getting active and the plan is to advance to an NI 43-101 for Trojarova in the spring. What else can we expect?
Scott Eldridge
Given that we have 4 antimony projects and 1 tin project as well that we don't necessarily need to talk about. Having 5 projects in the company, there's going to be plenty of news flow in terms of what we will see next. We are focused on Slovakia.
The Trojarova project, as we discussed, is our flagship. Our real focus now is to convert that historical resource to an NI43 101 inferred resource. From there, we would go immediately into a preliminary economic assessment.
That would give a snapshot of the economics in terms of mine life, annual production, mining costs, cash flow analysis, NPV, etc. That'll be a major turning point for the company. That would probably be a catalyst to start to get analysts involved in the company.
You'll definitely see more news flow out of Slovakia. It's been a very busy time for us, as you said. We've had a news release, I would say, every week for the last 8 weeks.
The company is very busy and active. I think that's what our shareholders like to see.
Goldfinger
Who is your point person in Slovakia?
Scott Eldridge
We have a country manager and then we also have communications community liaison person. Then we have a third geologist who's Slovakian, but he's not living in the country. Then fourth, we have a Canadian geologist who overlooks everything.
We have a team of four geologists, is the answer.
Goldfinger
What is your plan to expand Trojarova?
Scott Eldridge
Well, we do know that the drilling, although it was very successful, was stopped in what appeared to be the largest part of the ore body. The project currently contains about 60,000 tons of antimony in the ground, but we see an opportunity here to probably make that larger. As I mentioned earlier, we know this will be an underground project primarily because of the width of the veins.
That's just not amenable to open-pit. The strip ratio would be too significant, but we have very healthy underground mining widths here where you wouldn't see a lot of dilution, which is a concern for underground mining. It's most certainly in our minds an underground project.
We have a good base case resource here that would give us a very healthy mine life in a PA or a feasibility study scenario, but we also would like to see the blue sky potential of this to see how big this could be to unlock value there.
Goldfinger
Okay, very good. Scott, thank you for your time and this introduction.
Scott Eldridge
My pleasure, thank you.
Disclosure: Goldfinger Capital has been compensated by Military Metals Corp for the production, editing, and dissemination of this interview.
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