Rover Metals Corp. (ROVR:TSX.V; ROVMF:OTCQB; 4X0:FRA) has closed on its deal to option a 90% ownership interest in the Indian Mountain Lake project in the Northwest Territories as it continues its pivot to focus on critical metals and minerals like copper and zinc.
Trading on the stock was halted for more than two hours Wednesday as the company prepared to unleash the news.
The company does not plan to exit from its Cabin and Up Town gold projects but has said it is trying to get “ahead of the curve” with the 30,000-acre volcanic massive sulfide project.
Rover Metals Chief Executive Officer and Director Judson Culter said companies need to start picking up projects in North America to supply automakers. There’s no time to waste since the Indian Mountain Lake project could be “probably 10 years from production, which means the next three years are the most exciting times to get involved as an investor if you look at the life cycle of a mining investment.”
Copper and other critical metals and minerals are the backbones of the world’s switch to green energy. Copper conducts heat and electricity and is a major component in electric vehicles (EVs). Zinc is also used in batteries.
“That is our job now, not just saying that we need to move to cleaner energy; we need to supply the materials,” said Sarma Pisupati, professor of energy and mineral engineering and director of the Center for Critical Minerals at Penn State University. “The future needs these metals, these elements. So that is what the problem is. We haven’t been producing as much as we need, and that causes a shortage.”
Exploration at the Indian Mountain Lake site dates to the 1940s and into the 1990s, but geologists are now eyeing its copper resources in a new light at the dawn of the EV revolution.
“Companies, especially mining companies that have experience in these things, are looking for ways to improve their operations” by expanding into critical metals and minerals, Pisupati said. “Everybody thinks that mining is a dirty business, but they want all these sophisticated things. But without mining, we cannot get them.”
The Catalyst
The climate and energy package just passed by the United States is bringing new urgency to EV metals and minerals. To qualify for tax credits, a significant percentage of batteries and minerals in batteries must come from the U.S. or Canada, a regional trade-treaty country.
Rover Metals Chief Executive Officer and Director Judson Culter said companies need to start picking up projects in North America to supply automakers. There’s no time to waste since the Indian Mountain Lake project could be “probably 10 years from production, which means the next three years are the most exciting times to get involved as an investor if you look at the life cycle of a mining investment.”
Officials worldwide say a steady supply of these minerals and metals is vital.
“Today’s supply and investment plans for many critical minerals fall well short of what is needed to support an accelerated deployment of solar panels, wind turbines, and electric vehicles,” according to the International Energy Agency. “There are many vulnerabilities that may increase the possibility of market tightness and greater price volatility for critical minerals, such as the high geographical concentration of production, long project development lead times, or even higher exposure to climate risks.”
How policymakers and companies respond to these challenges “will determine whether critical minerals are a vital enabler for clean energy transitions or a bottleneck in the process,” the agency wrote.
The Project
Rover signed the definitive option agreement with Panarc Resources Ltd. for the project, which is located about 195 kilometers east-northeast of Yellowknife and has a historical zinc-lead-silver-copper geological reserve. The BB and Kennedy Lake zones have a combined historical resource of 1.4 million tons grading 10% combined zinc and lead with 3.5 ounces per ton of silver (Ag).
Under the agreement, during the first year, Rover has committed to spending CA$200,00 on exploration at the project and making a cash payment to Panarc of CA$20,000. Subject to the approval of the TSX Venture Exchange, Rover will issue Panarc an aggregate of 3.5 million common shares within six months, which will be subject to a four-month regulatory hold period.
About 900 meters west of BB, the Kennedy Lake West Zone has a historical resource of 610,000 tons grading 1.15% copper. And 8 kilometers southeast of BB is the Susu Lake Zone, consisting of a historical resource of 142,500 tons grading 0.95% copper.
The project sits at the 60th parallel and fits into Rover’s strategy of helping to secure Canada’s northern sovereignty in the Arctic. Within the region’s 21 million square kilometers, eight countries — Canada, Russia, the United States, Denmark, Sweden, Finland, Norway, and Iceland — have exclusive economic rights to resources up to 200 nautical miles from their shores.
As ocean temperatures rise and disrupt shorelines and shipping routes, heavy hitters like China are eyeing assets and deep seaports along Canada’s Northwest Arctic Passage, the company said.
Under the agreement, during the first year, Rover has committed to spending CA$200,00 on exploration at the project and making a cash payment to Panarc of CA$20,000. Subject to the approval of the TSX Venture Exchange, Rover will issue Panarc an aggregate of 3.5 million common shares within six months, which will be subject to a four-month regulatory hold period.
Culter said he expected to begin drilling at the site within the next year. Since the company owns Cabin and Up Town gold projects outright, he said it made sense to hold onto those projects as well.
Share Structure
Culter said he and family members own about 12 million shares of the company, and directors Keith Minty and Louis Covello own about 1 million and about 400,000, respectively. There are no institutional shareholders, and the rest are retail.
Rover’s market cap is CA$3.94 million, and it has 157.56 million shares outstanding, 149.5 million of them free-floating. It trades in a 52-week range of CA$0.08 and CA$0.02.
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