Featured Company /
Voyageur Minerals Ltd.
By now, active investors should be well aware of the opportunity in the lithium space. The coming of age of electric vehicles is expected to lead to lithium demand outstripping supply within the next decade. While it is easily the most publicized, Tesla is only one of dozens of carmakers, many in North America, fighting for EV market share. Due to the fact that there is only one lithium producing mine in North America, every promising lithium project on the continent is attractive as an investment.
Barite (BaSO4, barium sulfate), a mineral consisting of barium sulfate critical in the energy service/drilling industry, is not as sexy as a tech story, but it is perhaps even more attractive because of the scarcity of barite. This is especially true for high-grade barite, which is used in industrial applications (i.e. brake pads for autos, filler in paints and plastics, chemical industry, etc.), compared to oil-field-grade barite.
As it stands currently, the U.S and Canada are 100% reliant on importing high-grade barite from China and India, the world’s two top barite producers responsible for nearly two-thirds of annual production globally. Cumulatively, the U.S. and Canada consumed more than 3.91 million tons of barite in 2014. Depending on grind size and quality, imported powdered industrial grade barite sells for $400-$2,000 per tonne FOB West Coast.
Voyageur Minerals Ltd. (TSX-Venture:VM) wants to change the supply dynamic, with its sights set on becoming the only high-grade barite producer in North America. As an additional kicker, the company has its hands in the lithium space as well.
The Calgary-based company owns 100% interest in three barium sulfate deposits (Frances Creek, Jubilee Mountain, Pedley Mountain) outside of Radium, British Columbia, including two properties which initial work suggests are suitable in grade for the industrial barite market place, and interests in two lithium brine projects in Utah.
Exploration work late in 2016 exposed a 7.5 meter wide barite breccia vein extension on the Frances Creek deposit. A spring drilling program at Frances Creek will consist of 2,000 meters of infill drilling in two known zones of barite. Over 2,000 meters of historical drilling has helped define a strike length of over 600 meters to a vertical depth of 90 meters that remains open in all directions. An independent review of Frances Creek estimates exploration target ranges from 53,856 tonnes to 215,422 tonnes @ 95.86% to 99.26 % BaSO4, an estimate that can only be substantiated through additional exploration to define a true resource.
The spring drilling program is now underway to better delineate the resource for an updated NI 43-101 report.
Voyageur intends to generate cash flow from barite production operations in late 2018, revenues that will be allocated towards developing the other barite projects and the U.S. lithium projects as available.
The company has applied for a 10,000 tonne bulk sample for this summer, a permit that will pave the way to initial sales. Voyageur should have no trouble selling the barite locally, as companies in B.C. already source barite from China and India. With the first sale, Voyageur meets its major milestone as the only high-grade barite producer in North America. Then it just becomes a matter of how much they can produce.
At $1,000 per tonne for industrial barite, the company estimates that the first 12,000 tonnes potentially would generate $9.6 million in profit.
There certainly is opportunity, considering Chinese production fell 25% to 3 million tonnes in 2015 with estimates of another 15-20% decline last year. Indian barite production is also on the decline, falling 12% from 2012-2015.
Jubilee Mountain would be a natural second target for Voyageur. Over 10,200 meters of drilling took place from 1996 to 1998. 40,000 tonnes were mined of oil-field-grade barite until 2005. While an independent review of Pedley Mountain indicates it could be a large barite deposit of oil-field and industrial grades, the property requires drilling.
Early work on the lithium projects is ongoing, including joint venture partner Anson Resources announcing positive results on the latest metallurgical test work. The work demonstrated that magnesium concentrations were reduced to battery grade levels with a negligible loss of lithium during the process, which could save costs in the overall process to produce high-grade lithium.
Given these properties, Voyageur trading at 7 cents per share equates to a market capitalization of a meager $2.7 million. Comparable companies in the lithium space are trading at much higher valuations. That is, of course, without mentioning the barite projects, which have the potential of generating cash flow as early as the second half of 2018.
Considering growing domestic demand, surging demand in the Middle East and estimates that China may need to drill 10,000 wells per year by 2020 to meet its gas production targets, there is a global opportunity at hand for Voyageur with respect to barite that market participants are overlooking. Simply put, if China, who produces more than 45% of the world’s barite, meets its energy goals, it won’t have any available to export at current production levels. That leaves a company like Voyageur in a very enviable position.
Corporate Snapshot:
Voyageur Minerals Ltd.
Stock Symbol:
CA
Stock Exchange:
TSX-Venture
Sector:
Natural Resources
52 Week High:
$0.1250
52 Week Low:
$0.0650
Current Stock Quote / Chart / News: Click here
Information as of
May 23, 2017
By now, active investors should be well aware of the opportunity in the lithium space. The coming of age of electric vehicles is expected to lead to lithium demand outstripping supply within the next decade. While it is easily the most publicized, Tesla is only one of dozens of carmakers, many in North America, fighting for EV market share. Due to the fact that there is only one lithium producing mine in North America, every promising lithium project on the continent is attractive as an investment.
Barite (BaSO4, barium sulfate), a mineral consisting of barium sulfate critical in the energy service/drilling industry, is not as sexy as a tech story, but it is perhaps even more attractive because of the scarcity of barite. This is especially true for high-grade barite, which is used in industrial applications (i.e. brake pads for autos, filler in paints and plastics, chemical industry, etc.), compared to oil-field-grade barite.
As it stands currently, the U.S and Canada are 100% reliant on importing high-grade barite from China and India, the world’s two top barite producers responsible for nearly two-thirds of annual production globally. Cumulatively, the U.S. and Canada consumed more than 3.91 million tons of barite in 2014. Depending on grind size and quality, imported powdered industrial grade barite sells for $400-$2,000 per tonne FOB West Coast.
Voyageur Minerals Ltd. (TSX-Venture:VM) wants to change the supply dynamic, with its sights set on becoming the only high-grade barite producer in North America. As an additional kicker, the company has its hands in the lithium space as well.
The Calgary-based company owns 100% interest in three barium sulfate deposits (Frances Creek, Jubilee Mountain, Pedley Mountain) outside of Radium, British Columbia, including two properties which initial work suggests are suitable in grade for the industrial barite market place, and interests in two lithium brine projects in Utah.
Exploration work late in 2016 exposed a 7.5 meter wide barite breccia vein extension on the Frances Creek deposit. A spring drilling program at Frances Creek will consist of 2,000 meters of infill drilling in two known zones of barite. Over 2,000 meters of historical drilling has helped define a strike length of over 600 meters to a vertical depth of 90 meters that remains open in all directions. An independent review of Frances Creek estimates exploration target ranges from 53,856 tonnes to 215,422 tonnes @ 95.86% to 99.26 % BaSO4, an estimate that can only be substantiated through additional exploration to define a true resource.
The spring drilling program is now underway to better delineate the resource for an updated NI 43-101 report.
Voyageur intends to generate cash flow from barite production operations in late 2018, revenues that will be allocated towards developing the other barite projects and the U.S. lithium projects as available.
The company has applied for a 10,000 tonne bulk sample for this summer, a permit that will pave the way to initial sales. Voyageur should have no trouble selling the barite locally, as companies in B.C. already source barite from China and India. With the first sale, Voyageur meets its major milestone as the only high-grade barite producer in North America. Then it just becomes a matter of how much they can produce.
At $1,000 per tonne for industrial barite, the company estimates that the first 12,000 tonnes potentially would generate $9.6 million in profit.
There certainly is opportunity, considering Chinese production fell 25% to 3 million tonnes in 2015 with estimates of another 15-20% decline last year. Indian barite production is also on the decline, falling 12% from 2012-2015.
Jubilee Mountain would be a natural second target for Voyageur. Over 10,200 meters of drilling took place from 1996 to 1998. 40,000 tonnes were mined of oil-field-grade barite until 2005. While an independent review of Pedley Mountain indicates it could be a large barite deposit of oil-field and industrial grades, the property requires drilling.
Early work on the lithium projects is ongoing, including joint venture partner Anson Resources announcing positive results on the latest metallurgical test work. The work demonstrated that magnesium concentrations were reduced to battery grade levels with a negligible loss of lithium during the process, which could save costs in the overall process to produce high-grade lithium.
Given these properties, Voyageur trading at 7 cents per share equates to a market capitalization of a meager $2.7 million. Comparable companies in the lithium space are trading at much higher valuations. That is, of course, without mentioning the barite projects, which have the potential of generating cash flow as early as the second half of 2018.
Considering growing domestic demand, surging demand in the Middle East and estimates that China may need to drill 10,000 wells per year by 2020 to meet its gas production targets, there is a global opportunity at hand for Voyageur with respect to barite that market participants are overlooking. Simply put, if China, who produces more than 45% of the world’s barite, meets its energy goals, it won’t have any available to export at current production levels. That leaves a company like Voyageur in a very enviable position.
Forward Looking Statements
This report includes forward-looking statements that reflect current expectations about its future results, performance, prospects and opportunities. Voyageur Minerals Ltd. has tried to identify these forward-looking statements by using words and phrases such as "may," "will," "expects," "anticipates," "believes," "intends," "estimates," "plan," "should," "typical," "preliminary," "we are confident" or similar expressions. These forward-looking statements are based on information currently available and are subject to a number of risks, uncertainties and other factors that could cause Voyageur Minerals Ltd.'s actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. These risks, uncertainties and other factors include, without limitation, the Company's growth expectations and ongoing funding requirements, and specifically, the Company's growth prospects with scalable customers, and those outlined above. Other risks include the Company's limited operating history, the Company's history of operating losses, consumers' acceptance, the Company's use of licensed technologies, risk of increased competition, the potential need for additional financing, the terms and conditions of any financing that is consummated, the limited trading market for the Company's securities, the possible volatility of the Company's stock price, the concentration of ownership, and the potential fluctuation in the Company's operating results.
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