Delrey Metals Corp. (OTC:DLRYF)(CSE:DLRY)
is advancing what could become a sizeable Canadian Steel 2.0 (Vanadium + Iron) play
Micro-cap mining companies (valuations under $100 million) often come with a lot of upsides, and exciting “what ifs” to go over, as long as investors can endure the volatility. Successful companies must work diligently to develop their projects, prove up a resource, all while maintaining strategic financing and staying out of cash trouble.
One interesting play is Delrey Metals (OTC:DLRYF) (CSE:DLRY), a newly listed micro-cap resource company trading at CAD$0.15 with currently only a CAD$4.89 million market cap—and tightly managed with only 34.9 million shares outstanding. This company has a unique combination of attributes investors want to see in a world-class project, that could help redefine the steel market of the future.
China’s recent increase in regulations regarding the strengthening of steel rebar has increased demand across the globe—in particular for what can be termed as Steel 2.0. In order to make steel both lightweight and durable, the right mix of alloys are required, which today points towards both Vanadium and Iron.
The impact of Chinese demand (coupled with restricted production in Brazil) has also caused an increase in demand for iron ore—a sector that’s seen a major supply squeeze, leading to a 35% price increase, hitting a 5-year high of $108/tonne.
Also, one of the top performing metals of the last two years has been Vanadium, a critical mineral Trump declared in his executive order, currently sells at nearly 4x its mid-2016 price, making for a market projected to be worth over $56 billion by 2026.
For Delrey Metals (OTC:DLRYF) (CSE:DLRY), these two combined factors have driven what’s become a major “what if” factor for its advanced exploration stage Four Corners Project—which is returning significant numbers for both vanadium and iron.
Driven by very positive historical exploration, drilling, and reports, Delrey Metals (OTC:DLRYF) (CSE:DLRY) has amassed strong financial backing and interest from financiers for their flagship Four Corners Project—as well as four additional BC properties, also showing positive historical exploration results.
Geology Speaks: Newfoundland Project Has the Ingredients Investors Want to See
Located in Newfoundland and Labrador (consistently rated among the top mining jurisdictions in the world), is a notably large land package that contains statistically significant Vanadium-Iron-Titanium showings across a potential 16km strike-length—with selective outcrop samples of up to 56.92% Iron, 15.13% Titanium and 0.39% Vanadium Pentoxide.
The projected recovery levels of all three metals are significant, as the steel market ramps up. Timing wise, the Four Corners Project is at a fortunate stage, with plenty of blue sky potential left to unearth.
To date, this project has had over $2.3mm dollars in exploration expenditures put into it, and over 4000 meters of drilling including positive metallurgical studies completed by SRK Consulting.
According to the private project vendors website, who have been advancing this project for the past ten years, states the Keating Hill East Zone with over 4000 meters of drilling completed on it, “conservatively represents a potential target of over 2.37 billion tonnes* (French 2012).” The preliminary metallurgical results from SRK enhanced the project’s prospects, by reporting an impressive >90% Vanadium Pentoxide, ~70% Iron and >80% Titanium Oxide recovery.
As it stands, further internal preliminary estimates on Delrey Metals’ (OTC:DLRYF) (CSE:DLRY) Four Corners property projected there could speculatively be four times this amount of mineralization* from four closely spaced adjacent zones which could exist within the property.
It’s important to note these are all preliminary non-43-101-compliant estimates with further work needed to define them–However, this could be the opportunity for early-stage investors as Delrey Metals (OTC:DLRYF) (CSE:DLRY) moves rapidly on their exploration development plans.
With these historical figures in mind, has already begun work toward building a NI 43-101 resource estimate. Recently the company has completed successful re-assays of the project’s historic drill cores, with extremely pleasing results.
Already, lithium metaborate fusion assays returned on average 21% higher V2O5 (ranging from a 14% to 28% increase), with the unlocking of plenty of additional vanadium potential not fully recognized on the project to date.
Perhaps the most striking has been the increased value in iron on the property as well. With the metal’s surging prices and demand, as well as significant sample results, the Four Corners Project is just as much (if not more) an iron play as a vanadium play.
this stock could stand out among its peers—Through future work in order to expand on the historic exploration, Delrey Metals (OTC:DLRYF) (CSE:DLRY) is chasing a lot of potential Steel 2.0 (Vanadium and Iron) blue sky with the benefit of the previous work to underpin the exploration!
* Includes measured, indicated, and inferred tonnage.
Demand for Steel 2.0 and Rebar Is Growing Due to Important Regulation Changes
Asia pacific steel rebar market is expected to revenue over $110 billion by 2024, as per a recent report by Global Market Insights. Rising government budgets on renovation of structurally deficient buildings in the emerging economies has positively influenced steel rebar market share.
Amidst the steel rebar run, the iron ore market is surging, having recently punched through the $100/tonne level for the first time in five years. According to the World Steel Association, China’s steel production grew by 10% in the first quarter of this year. These ingredients have caused a perfect bull storm for iron with constrained supply running up against super-strong demand from China’s steel sector’s needs.
According to CRU International, the Chinese government is expected to increase its enforcement of stringent new regulations on steel rebar used in construction, which are expected to keep Steel 2.0 (vanadium and iron) prices at higher than historical levels.
Vanadium and iron are also crucial to the United States for its own domestic steel production. Under the current Trump administration there’s been a spike in demand. As U.S. steel and other major steel companies open new plants or reopen previously closed plants across the continent, the American steel industry is flourishing. Meanwhile, steelmakers are pleased to see their president maintain tariffs that are pushing their product demand higher within the US.
But competition from China is destined to really heat things up. A major shift is underway in the Chinese steel business, complete with new rounds of consolidation that is making other markets like Europe and Japan nervous.
This combination of factors has resulted in Canadian listed issuers with vanadium assets ranking among some of the best performing venture mining stocks in 2018. Delrey Metals (OTC:DLRYF) (CSE:DLRY) has built a solid case for having the right ingredients for positive performance in the coming years.
Steel 2.0 is the Super Metal of the Future
An advantage that Delrey Metals (OTC:DLRYF) (CSE:DLRY) has compared to peers and potential competitors, is the potential for large-cap like resources in both vanadium and iron—both important in Steel 2.0, and other uses.
Steel 2.0 isn’t technically new, but its use in technology and architecture today is making a resurgence that makes it feel new.
Modern research into what made 17th century “Damascus Swords” unearthed a secret ingredient—vanadium. These extraordinarily strong, flexible, and wieldy swords gained a mythical reputation during their time of use. Today, we’re seeing that iron infused with vanadium has many uses in today’s rapidly evolving market.
Iron Ore Surges Past $100/tonne
Iron ore is currently dominating headlines in the mining space, having broken the $100/tonne level for the first time since 2014. The timing of this surge is beneficial to Delrey Metals (OTC:DLRYF) (CSE:DLRY) as it was the vanadium potential that originally attracted the company to the Four Corners Project, but the recent iron ore push has renewed excitement in all three metals (Fe-Ti-V) found on site. Where the project stands out, is its potential world-class numbers in both vanadium and iron, in comparison to other standalone vanadium or iron projects in other parts of the world.
Initial reports have shown strong grades in magnetic concentrates as well as recoveries across the board (Fe ~70%, Ti >80%, V>90%), and they’re now looking forward to completing additional optimization which should allow them to fully realize the potential the project has going forward.
The initial attraction to the project’s vanadium has not faded either, as it presents opportunities beyond steel.
Vanadium use is increasing every day thanks to applications in the trillion-dollar infrastructure, automotive, and energy storage industries—such as the Vanadium-REDOX storage battery, which uses Vanadium Pentoxide (V2O5) as an electrolyte.
VRSBs are viewed as a major innovation in clean and renewable energy generation, providing an efficient mechanism for the storage of energy, and its release in a controlled fashion, according to demand.
Vanadium also has growing use (along with various rare-earth elements) in low density–high intensity magnets, which are also important in clean energy generation and hybrid vehicle manufacturing.
The National Research Council of Canada “NRC” has commissioned a study exploring the potential role Canada could play as a producer and supplier of Vanadium. There is currently no production of Vanadium in Canada, leaving all Vanadium to be imported. North America could be in a “state of emergency” if imports were to be negatively affected as we saw with Rare Earth Elements in 2010. The NRC states in a 2016 study:
“Given cost and quality considerations, vanadium used in VRFB s is about 1% of total current demand; however, demand could increase significantly over the next several years.. Considering the potential size of the grid energy storage market, even a slight increase in VRFB demand would mean significant growth in V2O5 consumption for this end-user product. For example, it is estimated that the vanadium consumption in the battery energy storage industry could rise 3100% by 2025, to 31 kt V”
Four Corners: A Model Property Location
The Delrey Metals (OTC:DLRYF) (CSE:DLRY) flagship Four Corners Vanadium-Iron-Titanium
project spans more than 7655.0 hectares. Located in western Newfoundland, 35km east of the town of Stephenville, the sizable property’s steel 2.0 potential, is complemented by its excellent existing infrastructure.
Along its entire length, the property is transected by the Burgeo Highway (Route 480) and a 33MW powerline. At the town of Stephenville, 35 km away, is a commercial airport, as well as an industrial service center that could act as a potential brownfield site for primary and secondary processing. Additionally, within a 40km radius, and along the paved highway, the Delrey Metals (OTC:DLRYF) (CSE:DLRY) property is a short distance from the deep-water ice-free Port Harmon Complex.
Needless to say, access to the site, and getting the product to market could come with relative ease. With expected low exploration and development costs, and no need for helicopter or camp support, the project is in a great location for development. Add in a previously received annual rebate of up to $150,000 of exploration expenditures from the provincial government under the Junior Exploration Assistance Program, Delrey Metals ‘s (OTC:DLRYF) (CSE:DLRY) flagship jurisdiction is a perfect location to advance this project.
Solid Historically Established Blue Sky Potential
At the core of the project’s potential is what “could be”. Preliminary historic assessments done on the property have as of yet brought the Four Corners Project under NI 43-101 reporting guidelines— Delrey Metals (OTC:DLRYF) (CSE:DLRY) is unable to classify the findings under current standards… for now.
Drilling on the property is planned to start mid-2019, which will be undertaken to add to and confirm the discovered vanadium mineralization at Keating Hill East – as well as testing the four other large target zones, additional geophysics, and metallurgical work— providing ample catalysts for news flow. The company also has plans to re-assay the historic drilling immediately in order to bring the historic assay results up to current standards.
The big story revolving around Four Corners began with a 2011 Airborne Electromagnetics (EM) Survey, which greatly added to the project’s potential. The Survey identified the four new strong geophysical anomalies, increasing the total potential strike length to more than 16km—approximately 4x greater than the original Keating Hill East (KHE) target zone estimated length.
Preliminary surface sampling confirmed the same style of mineralization found on the KHE to be spread throughout each of these other anomalies. Today, those anomalies are being targeted by Delrey Metals (OTC:DLRYF) (CSE:DLRY) for follow-up ground truthing and drilling.
BC Steel 2.0 Properties With Positive Historic Results
Complimenting Delrey Metals’ (OTC:DLRYF) (CSE:DLRY) flagship Four Corners project in Newfoundland, are the company’s 100%-owned Northern British Columbia Vanadium Properties: Blackie, Porcher, Star, and Peneece.
Blackie is an over 1,200-hectare property which comes with intriguing bedrock samples with historic highly elevated Vanadium Pentoxide assays. Through the current work program, Delrey Metals’ (OTC:DLRYF) (CSE:DLRY) is already in the process of resampling these under current standards and will be able to report them shortly. Located in a historic mining district, the Blackie project neighbors the high-grade Yellow Giant mine, which was operational as recently as 2015.
Porcher’s selective historic concentrate grades assayed as high as 0.84% Vanadium Pentoxide, over the newly-expanded 3,525-hectare property which is located less than 39km from Prince Rupert’s deepwater port. The project has a short trans-pacific route travel time to any North American west coast port, potentially providing the property with ideal mine-to-market geography.
Based on the results from the recent airborne geophysics program the Star property’s size was increased from 3,646 hectares to 4,618 hectares to fully encompass the latest newly expanded magnetic anomalies. Previous work done by the British Columbia Geological Survey Regional Geochemical Survey (RGS) completed in 2000 found a 5km x 7km magnetic anomaly, coincident with 99th percentile vanadium-in-silt results (up to 148ppm) in the province. Historic drilling was completed on the far eastern flank of this anomaly that indicated a much larger mineralized zone potentially exists within the property area to the west.
Much further to the south, Peneece is a more than 1500-hectare property located 68km east of the city of Port Hardy, British Columbia, also along tide-water. Historic select concentrate grades on the property ranged from 0.29% to 0.59% Vanadium Pentoxide and up to 6.5g/t of silver. As a bonus, it’s worth noting that a precious metal is not often found in appreciable quantities in these systems.
Historic airborne magnetometer survey work on Peneece identified one of the largest and strongest magnetic signatures in British Columbia over the property. This is coincident with a 4.8km by 0.8km gabbroic body (also open in multiple directions) hosting Vanadium – Iron- Titanium mineralization.
“The Delrey team is quite excited by the results of the Phase I work program on the Blackie, Porcher, and Star properties. The large anomalies identified by the 2019 surveys combined with historic surface sampling confirming vanadium and titanium mineralization gives us confidence in the potential of these three properties.”
– Morgan Good, President and Chief Executive Officer – Delrey Metals
Leadership Team of Finders and Market Financiers
Delrey Metals Corp. (OTC:DLRYF) (CSE:DLRY) is built upon a foundation of leadership consisting of market financiers and discoverers. Between the company’s management team and board of directors, is a collective track record of helping raise over ~$250 million in financing.
Delrey Metals’ (OTC:DLRYF) (CSE:DLRY)management is driven by a mandate to create shareholder value by sourcing, financing and developing undervalued strategic energy metals assets with an initial focus on vanadium due to its compelling supply and demand dynamics.
Here’s a quick look at some of the key highlights behind Delrey Metals Corp. (OTC:DLRYF) (CSE:DLRY):
The company is led by President, CEO & Director Morgan Good— a 15-year veteran Venture Capitalist specializing in sourcing undervalued opportunities in the mining resource, cannabis, and technology sectors. Over the course of his career, Good recently served as CEO of ALQ Gold, now Ignite International Brands (CSE: BILZ) where he raised approximately $20 million dollars in 2017/2018 and has since passed his CEO role over to Instagram Celebrity and Professional Poker Star, Dan Bilzerian.
Good is joined by Directors Mike Blady and Leighton Bocking who each bring recent experience with successful mining companies, and have also each been directly and indirectly responsible for raising an excess of ~$100 million to date.
Mike Blady currently serves as CEO and Director of Golden Ridge Resources (TSX.V: GLDN), which recently made a new major alkalic copper-gold porphyry discovery in the Golden Triangle. He also serves as an Officer and Director of GTEC Holdings (TSX.V: GTEC).
Leighton Bocking has successfully developed a career as an independent Corporate Development Consultant. From 2014 through 2015, Bocking was the Manager of Corporate Development at Gold Standard Ventures, Corp., and prior to that worked in Corporate Development for Timmins Gold Corp. between 2008 through 2013.
CFO Alastair Brownlow is a Chartered Professional Accountant and a U.S. Certified Public Accountant (Washington) with significant public company experience, and expertise in the mineral exploration and development field in Canada and throughout the world.
STRONG STEEL 2.0 FUNDAMENTALS
Delrey Metals (OTC:DLRYF) (CSE:DLRY) is one of a relatively few North American listed exploration companies with strong steel 2.0 potential for iron and vanadium together, building upon the strengths witnessed by the niche group vanadium-only companies that ranked among the best-performing venture mining stocks in 2018. Propped up by strict new Chinese regulations for steel rebar, and rising demand for steel, iron prices and demand are surging, while vanadium prices remain steady at historically high levels. The Four Corners project has all the ingredients to become one of the top steel 2.0 projects in North America, with its historical observations that hinted towards quantifiably significant levels of iron, vanadium, and titanium. The company is actively working towards bringing these historical findings into modern 43-101 compliance. Investor interest is growing toward both iron and vanadium plays, hinting towards a steel 2.0 demand, which fits for Delrey Metals (OTC:DLRYF) (CSE:DLRY) that has an advanced exploration stage project that should stand out among its peer group.
PRIME LOCATION AND INFRASTRUCTURE
Located in the world-class mining jurisdiction of Newfoundland and Labrador, the Four Corners Vanadium-Iron-Titanium project is not only a notably large land package but presents Delrey Metals (OTC:DLRYF) (CSE:DLRY) with significant infrastructure in a very mining friendly jurisdiction. The entire property is transected by a major paved highway and a 33MW powerline. It’s near a deep-water ice-free port, a commercial airport, industrial service center, and a nearby city populated with a potential workforce that would likely welcome the jobs a mining operation would create.
HISTORICALLY TESTED WITH CONSIDERABLE BLUE SKY POTENTIAL
Though none of the historic work done to-date on the Four Corners project falls under NI 43-101 reporting guidelines and needs to be expanded upon, Delrey Metals (OTC:DLRYF) (CSE:DLRY) has been given a glimpse of the size of vanadium mineralization that could be underneath. Working rapidly to get the historic work compliant and expanded on, through near-term and future work programs could be a significant catalyst for Delrey Metals (OTC:DLRYF) (CSE:DLRY). On top of this, these projects were all previously held by private companies and the story is just now getting out to the market.
ADDITIONAL PROMISING BC PROPERTIES
Complementing the Four Corners project, Delrey Metals (OTC:DLRYF) (CSE:DLRY) is also advancing four other Vanadium properties on British Columbia’s Pacific Coast. Each located at tidewater, within reach of a large shipping port, and come with ideal mine-to-market geography. The company has scheduled plenty of additional work on the properties, already underway with the recently completed airborne geophysics program and plans to drill this summer. So far, the geophysical surveys when combined with historic surface sampling confirming Vanadium, Iron and Titanium mineralization are giving confidence in the properties.
LED BY FINDERS AND MARKET FINANCIERS
Between its management team and board of directors, Delrey Metals Corp. (OTC:DLRYF) (CSE:DLRY) is built upon a collective track record of helping raise over ~$250 million in financing. This strength was evidenced by the company’s fully subscribed IPO, led by President, CEO & Director, Morgan Good, who himself has been directly or indirectly responsible for raising in excess of ~$75 million over his career. Good is joined by Directors Mike Blady and Leighton Bocking who each bring recent experience with successful mining companies, as well as their own history of driving healthy financing rounds for their companies.
*Please note all work mentioned above is historic in nature and previously carried out by the private project vendor and Delrey’s QP, as defined under NI 43-101 has not prepared nor verified the historical information at this time. The reader is cautioned that any mention of tonnage is highly speculative and conceptual in nature and, as such, there has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in the targets being delineated as a mineral resource. Any reference to historical results are believed to be based on reasonable assumptions, and neither the company nor its qualified person has any reason to contest the relevance and reliability of the historical samples. A qualified person has not done sufficient work to replicate any mention of historic rock grab samples using current lab methods. Although the historical rock grab samples are believed to be based on reasonable sampling and assay methodologies, they were calculated prior to the implementation of National Instrument 43-101. Any historical assays do not meet current standards as defined under sections 3.2a-c of NI 43-101; consequently, the Company is not treating the historical rock grabs with full confidence at this time. Historical information and estimates regarding the Company’s projects are reported for historical reference only.