Why did you choose PMET? It was then Patriot Battery Metals.
Yeah, thanks Nicholas. Really appreciate it. And to all the shareholders both in the room and participating online, a really warm welcome to you. Thanks for your support for PMET and our activities.
You know, I had deja vu when I first got exposed to the discovery at James Bay. And well done, David, you almost got there in the pronunciation. It was deja vu because at Pilgangoora we had the benefit of scale in the project. The geology was always going to support what we thought could ultimately be a big lithium mine, and fortunately that proved to be the case. And the location — I think everybody knows that the Pilbara is one of the world's great mining jurisdictions.
When the discovery emerged at James Bay, the first drill holes went in in November 2021. It was obvious from day one it was going to be a really material discovery because of the scale and the nature of the geology in the drill hole in the ground. It was just premier, and it really piqued our interest at Pilbara Minerals.
And then for me more personally, I thought this is worth following to the point where I got invested, because I was winding down at Pilbara Minerals in a manner of speaking. I suppose I was looking for something to do, and this looked like the real deal. And I can only tell you that since then the project has got better and better and better to the point where, as much as I love Pilgangoora and I think the team there is doing an amazing job — I'm really proud of where they've got to — the truth is this project is much better, and it's much better because it too carries scale and grade in lithium, higher grade than Pilgangoora, but it has this incredible complement of cesium and tantalum. And I think, Nick, that's something that we should talk about more.
We'll get to that in a second, Ken. But I just wanted to start with, I think, the question that just about every investor in this room wants to know. So lithium has been a roller coaster ride — that would probably be an understatement.
Yeah, it was a roller coaster ride even at Pilbara. I remember those days very, very vividly.
Perhaps if we could just start by giving people your big picture view. Where is the lithium cycle at now, and why should investors embrace the opportunity in lithium?
Yeah, it's absolutely the case that the opportunity hasn't gone away, I can assure you. And that's because the lithium story is a massive demand story. As lithium-ion cells get cheaper and cheaper and cheaper — which is pretty much the phenomenon underway today, as it has been in the last decade — the addressable market for lithium batteries grows in a way that most people haven't been able to anticipate.
So really, up until two years ago, we were talking about lithium-ion batteries as being an EV story. I want to take you back to a conversation that we had in the Pilbara Minerals days with CATL, the world's largest battery manufacturer. They were courting Pilbara Minerals. They wanted to invest in us, they wanted to invest in the project, and they made their pitch as to what the lithium-ion battery was going to do. And they said, we start with EVs, but that's not the finish of the lithium-ion cell — that's just a stepping stone to get a larger format battery such that it's cheaper, so that it addresses the stationary energy storage market.
Now bear in mind that was 2016, and here we are 10 years later — they have been spot on. The stationary energy market will be much, much bigger than EVs, and that's because every energy network around the world will ultimately use them in some way, shape or form. They'll use them at a house or home scale, and they'll use them all the way up to grid scale because they are now so economic in their application, because the cells are so cheap.
And the truth is, no analyst has been able to predict that fact because the cells have got cheaper faster than most people ever imagined that they would, and the addressable market is ballooning. That's why it's a demand story, Nick. And that means the price is not going away. It's not going away. It's going to be okay, and there'll be some decent spikes along the way as well.
So, let's talk about the deposit, Ken. And I know you've got some slides, so feel free to pick those up. So, James Bay — how's that? Did I get it right? Well done. So we know it's a top 10 lithium resource. There's no questioning about the scale of the project and its significance. But people say, well, you're in Canada, you're also in this long curve of development. You know, it takes a long time to move these projects through those phases of evaluation, financing, etc. Why are you confident that such a big deposit, and being located where it is in Quebec, will be permitted and will move into production?
Yeah, there's a couple of things going on there, Nick. Firstly, full credit to the team at PMET because they are working very, very hard to ensure that the project continues down the development pathway. Bear in mind it was only discovered in November 2021, and here we are today. We're approximately two-thirds of the way through the mine authorization process. So in that period of time we've done 300,000 metres of drilling, we've developed a 140 million tonne resource in lithium, 2.4 million tonne resource in cesium, and oodles of tantalum. And we've published our feasibility study. We expect the mine to be authorized by the end of next year. So we've come a long way in a relatively short period of time. It's only just over four years ago that the resource was discovered.
Well, how does that happen? Firstly, the team is working very hard, and I'm really proud to be working with a fantastic team. Secondly, Quebec is one of the world's great mining jurisdictions. Going back to the opening comments, I mean, not many people know much about Quebec, but I jokingly refer to it as French-speaking Western Australia. And it's because the culture there is a lot about mining, and there's lots of mines in Quebec. They're diverse — some are open pits, some are underground, like Western Australia. There's talented people, good leadership, and there's a sound rule of law like there is in most places in Australia — not quite all. So Quebec's a good place to be working.
First Nations engagement is world-leading. I kid you not. They are doing that in the James Bay region in Quebec about as good as anyone that I'm aware of around the world. It's very, very clear the pathway. The Cree themselves are a sophisticated counterparty. They're well-funded, they're well-led, and they're commercial. All those things contribute to ultimately lots of mines being authorized, which is exactly what happens in the region. So there's a lot to like about it, Nick. It's not a place that we should be scared of.
Ken, you've got three minerals there, and you've been talking a lot about this co-product strategy over the last 12 months or so in terms of cesium and tantalum. Without getting sort of too much into the weeds of that, can you give us just a sense of how significant those additional elements are? And firstly, what are they used for as well?
Yeah, absolutely. So, yeah, cesium especially I don't think people have generally heard of, but both cesium and tantalum are critical minerals, as listed alongside a lot of the other ones that you would have heard of. But cesium and tantalum are part of that group. They're specialty metals, and they typically have classic industrial uses that most of you would be vaguely familiar with, but not necessarily the detail.
So tantalum — defense, aerospace for alloys and jet engine turbines is a good example, where they spray a tantalum spray on them to make them hard and to minimize abrasion on the blades. It's in the electronics industry. Tantalum's been on an almighty run too, by the way. Prices tripled in the last 18 months, and it's being motivated by key demand from the AI build-out. So chip manufacturing, where tantalum is a thin film for the distribution of heat in a chip, and for printed circuit boards, where tantalum is a key capacitor installed on all those printed circuit boards that are making their way into data centres. So that's what's motivating tantalum, that's what it's used for, and we've got it in abundance.
We're the fifth largest tantalite resource globally, and the credit is really high in grade. Again, a little comparison: 165 parts per million background in tantalum in our resource. Pilgangoora, under Pilbara Minerals' banner, is 105. So 60% more grade. So it makes a big difference in the economic paradigm.
Cesium — not much heard of, but key to the oil and gas industry. Cesium formate is used as a non-toxic drill media to cap high-pressure, high-temperature wells, and there's not enough globally as we go into more and more difficult basins where there is high pressure, high temperature.
A little anecdote to help understand the paradigm: if they had cesium formate in the Gulf of Mexico, there would have been no Deepwater Horizon event. But they don't have cesium formate there — there's not enough. So if you can get it, you're buying it off the Chinese. And at the moment they support the North Sea — offshore in the North Sea they support with cesium formate, but they don't have enough to serve the other high-temperature, high-pressure basins that exist around the world. So we can be a part of that with a massive discovery like the one that we have.
