Electric Royalties Ltd (CVE:ELEC) is a royalty company established so investors can participate in the demand for commodities, such as lithium, vanadium, manganese, tin, graphite, cobalt, nickel and copper, which will benefit from the global drive toward electrification of a variety of consumer products, including cars, rechargeable batteries, large scale energy storage, and renewable energy generation.
The Vancouver, British Columbia-based company has a portfolio of 12 royalties and plans to focus predominantly on acquiring royalties on advanced stage and operating projects to build a diversified portfolio located in jurisdictions with low geopolitical risk.
Electric Royalties’ portfolio includes:
0.5% gross revenue royalty on the Authier Lithium project in Quebec. The project, which is operated by Australia-listed Sayona Lithium and includes a strategic investment and off-take agreement with Piedmont Lithium, could begin construction as early as 2021
2% gross revenue royalty on the exploration claims surrounding the Authier Lithium project
2% gross revenue royalty on the Bouvier and Chubb lithium projects in Quebec
1% gross revenue royalty on the Mont Sorcier vanadium and iron ore property in Quebec, which is estimated to produce 5 million tonnes of concentrate annually grading 65% iron and 0.6% vanadium based on a Preliminary Economic Assessment (PEA)
2% gross royalty on the Battery Hill manganese property in New Brunswick, which has an Inferred Mineral Resource of 44.8 million tonnes with an average grade of 9.85% manganese and 14.15% iron
0.5% gross revenue royalty on the Millennium cobalt, Mt Dorothy cobalt, and Cobalt Ridge properties in Australia
1% gross royalty, with an option to acquire an additional 0.5% gross revenue royalty within two years, on the feasibility-stage Bissett Creek graphite property in Ontario
Electric Royalties is led by CEO Brendan Yurik, who has previous experience as a research analyst as well as business development and mining financial advisory roles with companies such as Endeavour Financial and Northern Vertex Mining Corp.
Electric Royalties management and board of directors collectively own about 20% of the company’s outstanding shares.
In mid-February 2021, Electric Royalties announced an agreement to acquire a 1.5% Net Smelter Royalty (NSR) on the Seymour Lake lithium deposit in Ontario, a 16,654 hectare (ha) property containing lithium mineralization hosted in spodumene-bearing pegmatite sills with thicknesses of more than 26 metres.
The company said these near-surface pegmatite sills have been defined over a 5 kilometre (km) strike length and comprise multiple prospective targets, including North Aubry, Central Aubry, South Aubry and Pye.
It added that the proximity of the pegmatites to surface at the North Aubry prospect is considered to be a strategic advantage, potentially allowing easier access to high-quality mineralization in a future mining scenario, reducing the required pre-strip and resulting in a lower extraction cost and improved project economics.
In Seymour Lake, Electric Royalties sees similar potential to the Authier project in Quebec. The company said it will issue 3 million of its common shares to pay for the Seymour Lake NSR.
Earlier in the year, the company agreed to acquire a portfolio of 3 Australian cobalt property royalties from Global Energy Metals Corp (CVE:GEMC) in consideration for 1.15 million Electric Royalties shares and C$150,000 in cash.
Electric Royalties began trading on the Toronto Venture Exchange in late June 2020, after raising $5.2 million from a non-brokered private placement following a reverse takeover of Rebel Capital.
Inflection points:
Potential to acquire a producing/cash-flowing royalty
Creating new royalties with exposure to electricity metals
Additional Merger & Acquisition opportunities
Commenting on the company’s royalty portfolio, Electric Royalties CEO Brendan Yurik said in a statement: “The operators of our royalty assets have made significant progress over the past year and are moving their projects steadily onwards to production. The advancement of the projects increases the value of our royalties without requiring us to outlay additional capital and is one of the most overlooked benefits of the royalty business model.”
www.ferroalloynet.com
