Energy Metals Snapshot: Eight companies to watch

As zero-emissions technologies continue to develop, demand is steadily rising for uranium, nickel, lithium, copper and graphite. Here’s a glimpse of eight companies exploring for or mining the energy metals.

Baselode Energy 

Baselode Energy (TSXV: FIND, US-OTC: BSENF), a Toronto-based uranium explorer, is expanding its drilling program targeting near-surface, high-grade orebodies in northern Saskatchewan’s Athabasca Basin. 

In 2022, Baselode completed a 22,500-metre drill program at the ACKIO uranium discovery at its Hook project, located 40 km southeast of the McArthur River mine and 60 km northeast of the Key Lake uranium mill. Assay results from 78 drill holes revealed numerous uranium intercepts of greater than 0.5% U₃O₈ occurring about 25 to 325 metres below surface, with an average lower depth of 155 metres.  

In November, Baselode released the final results from its 2022 exploration program. Highlights include hole AK22-018, which intersected 34.8 metres of composite mineralization including 2.7 metres at 0.43% U₃O₈ starting from 142 metres true vertical depth; and AK22-066 which returned 37.5 metres of composite mineralization including 24 metres of 0.14% U₃O₈ from 107 metres. 

James Sykes, president and CEO of Baselode, notes that the results from AK22-066 indicate the team “likely clipped the margin of another large mineralized zone to the west,” similar to the results from hole AK22-063, which featured 59.9 metres of composite mineralization starting at 40 metres depth.  

Baselode plans to continue defining and expanding the ACKIO discovery, which measures about 375 metres along strike and more than 150 metres wide. The firm’s 2023 drilling plans include a 20,000-metre, 87-hole program focusing on near-surface high-grade uranium zones, and 16 holes (5,000 –metres) drilling targets within a 1-km radius of ACKIO. 

In addition, the company is preparing for the first drill program on its nearby Catharsis project, 60 km south of the Athabasca Basin margin. Baselode announced in January that field crews had been sent to Catharsis to prepare for a 2,000-metre, eight-hole plan scheduled for later this year.  

Baselode has a market cap of around $46.9 million. 

Canada Nickel 

Canada Nickel (TSXV: CNC; US-OTC; CNIKF) is consolidating a substantial new nickel district around Timmins, Ont., that stands to be one of the few new supply sources outside of Asia.  

Last July, the company released an updated resource estimate for its flagship Crawford nickel-cobalt sulphide project that shows it to be the fifth largest nickel sulphide resource globally, based on measured and indicated resources. 

A feasibility study for the project is under way. A May 2022 preliminary economic assessment estimated  the project would generate a post-tax net present value of US$1.2 billion (at a discount rate of 8%) and an internal rate of return of 16%. The capital cost was pegged at US$1.9 billion.

Canada Nickel kicked off the permitting process for Crawford last summer when it submitted the preliminary initial project description draft to the Impact Assessment Agency of Canada. The submission followed the signing of agreements with local Indigenous communities to foster their full participation in the federal impact assessment process. 

Recent test work confirmed the ability to incorporate carbon capture and storage into the Crawford project plant design, potentially making it the only large-scale carbon storage facility in Ontario and one of largest facilities in Canada. 

In January, Canada Nickel announced a major discovery at its Reid property, about 16 km southwest of Crawford.  All 16 holes drilled at Reid intersected intervals of predominantly nickel sulphide mineralization that spanned several hundred metres, with grades ranging from 0.2% to 0.31% nickel. The company says Reid’s geophysical footprint is larger than Crawford. 

Holes REI22-14 and REI22-16 confirm that mineralization at Reid is over 500 metres wide, about 50% wider than the Crawford main zone. Assay results from the holes confirm nickel mineralization in serpentinized dunite and peridotite. 

Hole REI22-14 averaged 0.2% nickel over 327 metres, including 0.3% nickel over 58.5 metres at the end of the hole. REI22-16 ended in higher grade mineralization, averaging 0.25% nickel over 471 metres, including 0.31% nickel over 60 metres at the end of the hole.  

Canada Nickel has a market cap of about $196 million. 

Grounded Lithium 

Grounded Lithium (TSXV: GRD; US-OTC: GRDAF) is a lithium brine exploration and development company focused on the Prairies. In December, the company reported an updated resource for its Kindersley lithium project in southwestern Saskatchewan. The inferred resource now totals 9.4 billion cubic metres of brine with an estimated lithium concentration of 74 mg per litre for 3.7 million tonnes of lithium carbonate equivalent, a 28% increase from an initial resource filed in April 2022. 

Part of that increase comes from a boost to the company’s land holdings this year to about 780 sq. km. 

In December, the Calgary-based company also provided results from its ‘4-15’ brine well, its second drilled in Saskatchewan. The well was drilled in the Duperow carbonite formation to 1,145 metres depth over seven days in summer 2022. The company says it gained critical information needed to assess the economics of the project, including fluid delivery and lithium concentration metrics. It plans to complete a preliminary economic assessment in the second quarter of 2023.  

Brines taken from the well yielded elemental lithium concentrations between 74 and 81 mg per litre and were free from hydrocarbon and sour gas impurities. Flow and pressure measurements from the 4-15 well and data from surrounding areas enabled Grounded to construct a three-dimensional reservoir flow model of the site. These calculations estimated well productivity rates of up to 29,000 barrels per day, though the firm expects to restrict this to 18,000 barrels per day to ensure deliverability over time. 

For 2023, the firm has engaged engineering consultancy Hatch to fast-track selection of an extraction technology suitable for the 4-15 well chemistry. 

Grounded Lithium has a market cap of around $20.7 million. 

Lithium One Metals 

Lithium One Metals (TSXV: LONE), a Vancouver-based explorer, has been acquiring strategic new holdings in both Quebec and Ontario. 

In December, Lithium One closed its acquisition of the Taycan lithium project, a 36-sq.-km property comprising 70 mineral claims in Quebec’s James Bay region. The project adjoins the Corvette discovery owned by Patriot Battery Metals (TSXV: PMET; ASX: PMT) and includes the standalone Lac Astrid claim. 

Lithium One plans to launch an initial prospecting, mapping, and sampling exploration campaign at Taycan this spring. Previous exploration, including government mapping from 2011, identified white pegmatite outcrops with muscovite and tourmaline, which are prospective for hosting high-grade lithium.  

And in January, the company announced it had entered into option agreements to acquire six lithium properties in the Red Lake and Thunder Bay mining divisions in northwestern Ontario. The agreements stand to add 23.3 sq. km to the firm’s portfolio. 

Highlights of the Ontario acquisitions include the Root South property, a site adjacent to the 2-million-tonne McCombe lithium deposit (averaging 1.3% Li₂O) owned by Australian explorer Green Technology Metals (ASX: GT1); the Parks project, located in a pegmatite field about 10 km east of Rock Tech Lithium’s (TSXV: RCK; US-OTC: RCKTF) Georgia Lake project; and the Allison South project, situated in an area identified by government mapping for high lithium exploration potential. 

Lithium One has a market cap of around $13.5 million. 

Marimaca Copper 

Marimaca Copper (TSX: MARI; US-OTC: MARIF) is a Vancouver-based company working to advance its flagship project in Chile’s Antofagasta region.  

Following a 2022 drilling campaign that consisted of over 41,500 metres of reverse-circulation and diamond drilling of the Marimaca oxide deposit, the company released assay results in December and January which revealed the project’s significant sulphide potential. 

Highlights include hole LAR-109, which intersected 308 metres at 0.94% total copper from 32 metres — the company’s best copper intersection to date on a grade x width basis since project discovery in 2016. Also of note is hole MAD-22, which cut 240 metres at 1.01% total copper from surface in two separate zones, oxide and primary sulphide. 

In October, Marimaca released a resource estimate that outlined nearly 140 million tonnes at 0.48% total copper for 665,500 tonnes of contained copper in the measured and indicated categories, plus 83 million inferred tonnes at 0.39% total copper for 322,900 tonnes of contained copper. 

This year, Marimaca is targeting conversion of more of its resources to the measured and indicated category through further exploration, particularly by following the primary sulphide intersection from hole MAD-22. The company also aims to start feasibility study work and begin project permitting workstreams later this year. 

The Marimaca deposit is one of the few major copper discoveries made globally in the last decade.  

Marimaca Copper has a market cap of about $324 million. 

NexGen Energy 

Uranium exploration and development-stage company NexGen Energy (TSX: NXE; NYSE: NXE) recently cleared a significant milestone in the advancement of regulatory approvals for its 100%-owned Rook I project in the southwestern Athabasca Basin. 

NexGen announced in December that it had received assessments from federal and provincial authorities, as well as public review comments, regarding the draft environmental impact statement (EIS) for the proposed Rook I underground mine and mill development. Now, the company reports it is reviewing the comments and preparing for final EIS submission in the first quarter of this year. 

NexGen CEO Leigh Curyer said that the firm was “extremely pleased” about the results of the technical review and thanked Indigenous and area partners for their collaboration on the draft EIS.  

Curyer also notes that the firm is well advanced toward the project’s front-end engineering design, scheduled to be completed in early 2023. 

Located in Saskatchewan, about 40 km east of the Alberta border, Rook I is the largest development-stage uranium project in Canada.  

A 2021 feasibility study outlined an expected average production of 21.7 million lbs. of uranium annually for 10.7 years. The study put Rook’s measured and indicated resources at 3.7 million tonnes grading 3.1% U₃O₈for 256.7 million lbs. contained uranium oxide. Probable mineral reserves from the main of A2 and A3 structures come to a total of 4.5 million tonnes grading 2.37% U₃O₈, for 239.6 million lb. U₃O₈. 

The total initial capital cost is estimated at $1.3 billion.  

At an 8% discount rate, the project would generate a post-tax net present value (NPV) of $3.5 billion and a post-tax internal rate of return (IRR) of 52.4%.   

NexGen Energy has a market cap of around $3 billion. 

South Star Battery Metals

Vancouver-headquartered South Star Battery Metals (TSXV: STS; US-OTC: STSBF) is advancing its Santa Cruz graphite mine in eastern Brazil towards first production before the end of 2023. 

Production from the US$8-million open pit project in Bahia state will begin at a rate of 5,000 tonnes of concentrate per year. The company plans a US$27-million expansion to 25,000 tonnes a year, followed by a third phase expansion to 50,000 tonnes per year. Permits and licences are in place for the first phase of production. 

South Star also recently intercepted significant graphite mineralization during initial drilling of its Ceylon project in Alabama. 

Located on the northeast edge of the Alabama graphite belt in Coosa County, about 80 km north of Montgomery, South Star’s 2-sq.-km project is a past-producing mine last active during the Second World War. The Ceylon mine historically targeted friable outcropping mineralization, averaging about 3 to 5% graphitic carbon. 

In January, the company reported that all 12 holes from its inaugural 506-metre drilling program in 2022 hit intervals ranging from about 1.5 to 4.5% graphitic carbon either at or near the surface. Highlights include hole CMD22-004, which returned 51 metres of 2.4% graphitic carbon starting from 8 metres, including 3 metres of 4% graphitic carbon. 

Calling it “a great start to defining our resource potential,” South Star CEO Richard Pierce said that the company would use the assay results to put together an initial NI 43-101 resource estimate in the first quarter of 2023. 

In December, the company announced the completion of pilot plant metallurgical testing. Through work at the Mineral Research Laboratory of North Carolina State University, 3 tons of sampled material from Ceylon were milled and subjected to rougher and cleaner flotation steps to produce approximately 30 kg of flake graphite concentrate. South Star is partnering with an unnamed lab in the United States to test the concentrate for battery use. 

South Star has a market cap of about $19.3 million. 

Surge Battery Metals 

Surge Battery Metals (TSXV: NILI; US-OTC: NILIF) is looking to develop its lithium holdings in Nevada and nickel-iron alloy projects in British Columbia. 

Surge added 71 mineral claims to its 100%-owned Nevada North lithium project in January, boosting the property size to 19.5 sq. km. Located in the Granite Range, about 40 km southeast of Jackpot, NV, the project targets lithium clay deposits in volcanic tuff and tuffaceous sediments. Soil sampling by the firm has outlined multiple highly anomalous zones containing up to 5,120 parts per million (ppm) lithium. 

In January, Surge released assay results from initial drilling at Nevada North. An eight-hole, 776-metre program revealed that significant lithium values continued at depth. The best hole NN2207 intersected 120 metres of lithium-rich claystone averaging 3,943 ppm lithium over four zones. 

The results extend the strike length of the mineralization to 1,620 metres from hole NN2205 to NN2208. While the width of the mineralization has yet to be determined, the company reports it is at least 400 metres and soil anomalies indicate it is likely much wider. 

Surge recently began an exploratory drill program on its 80%-owned Hard Nickel 4 project in central British Columbia. Preliminary X-ray fluorescence analysis indicated hole HN4-22-01 intersected serpentine altered peridotite that exhibited strong magnetic response and elevated nickel levels. 

Surge Battery Materials has a market cap of about $23.1 million.