Quebec Explorer To Expand Gold Resource, Search for Lithium

Quebec Precious Metals Corp. (QPM:TSX.V; CJCFF:OTCQB;YXEP:FSE) is set to continue drilling at its flagship Sakami project in the James Bay territory of Quebec next month as it also studies whether its properties include viable amounts of lithium.

To date, the company has drilled more than 50,000 meters and is looking to reach the mineral resource estimation stage at Sakami.

"Now we're going to step out and test more," Chief Executive Officer Normand Champigny told Streetwise Reports.

Sakami remains largely under-explored, with a potential of 2 million ounces (Moz) or more of gold, which could attract a major to mine and develop the property. Drilling at the site over the fall and winter of 2021-2022 led to assay results of 69.6 grams gold per tonne (69.6 g/t Au) over 0.6 meter inside a longer intercept of 94 meters grading 1.32 g/t Au.

Highlights from drilling at the La Pointe Extension deposit included 1.61 g/t Au over 19.5 meters, including 4.91 g/t Au over 1.5 meters; and 0.84 g/t Au over 63 meters, including 1.25 g/t Au over 18 meters.

"The growing adoption of hybrid and electric vehicles, high-drain portable electronics, and energy storage systems has had a huge impact on the growth of the overall market," Fortune Business Insights wrote. 

With more exploration, the company said Sakami has the potential to become a series of significant deposits along a 23-kilometer trend.

QPM plans to start drilling at the LaPointe Extension and other points in the southwest in July, and the results from its lithium study are expected in mid-July.

The global lithium market is expected to grow from US$3.83 billion in 2021 to US$6.62 billion in 2028.

"The growing adoption of hybrid and electric vehicles, high-drain portable electronics, and energy storage systems has had a huge impact on the growth of the overall market," Fortune Business Insights wrote. "The rise in adoption of electric vehicles (EVs) is attributable to the growing concerns surrounding environmental pollution as EVs reduce carbon emissions."

The Catalyst: Explorers Target Gold, Lithium

Quebec Precious Metals was formed from the merger of Canada Strategic Metals Inc. and Matamec Explorations Inc. in 2018.

Champigny said the company was started with the hopes of finding the next Éléonore mine, one of the largest underground gold mines in Quebec owned by the world's largest miner, Newmont Corp. (NEM:NYSE)

The James Bay territory itself is about the size of Arizona. Gold was initially reported in the area in the 1890s, but it would take more than a century and significant development in the area before it got the attention of investors.

Now it's not just gold, but a lithium rush is on in the province, where many deposits of the important battery metal are hosted in pegmatite rocks.

"We know we have pegmatite on our gold projects, but we didn't focus on lithium," Champigny said. "That was not the purpose of the creation of the company. But we almost have a moral obligation to find out. And so that's what we're doing now."

Shifting Supply Chains From South America, China

The company has contracted ALS GoldSpot Discoveries Ltd. to do a detailed lithium-targeting study on its 1,338 claims covering 697 square kilometers, all 100%-owned.

Patriot Battery Metals Inc. (PMET:CA) discovered a 4.3-kilometer trend of spodumene pegmatite in James Bay in 2017. Its market cap was nearly CA$500 million last fall. Now, it's CA$1.47 billion.

Canadian Prime Minister Justin Trudeau and provincial leaders are selling the country as an important backstop to shift supply chains away from South America and China. Canada has listed lithium among the top six critical minerals. The others are graphite, nickel, cobalt, copper, and rare earth elements.

QPM noted that its Elmer East project is located north to northwest of three significant lithium deposits being developed by Allkem Ltd. (OROCF;OTCMKTS), Critical Elements Corp. (CRE:TSX.V), and Investissement Québec and Livent Corp. (LTHM:NYSE)

QPM also has another play when it comes to lithium. It entered a binding memorandum of understanding with Idaho Champion Gold Mines Canada Inc. (ITKO:CNX) last fall for Idaho Champion to acquire a 100% interest in two other James Bay lithium pegmatite projects. QPM still has 6% of its shares.

Ownership and Share Structure

Newmont owns about 13% of QPM. Government-backed Caisse de Dépôt et Placement du Québec and other Québec institutions own about 12%.

QPM management and insiders own about 15%, including non-executive Chairman James Shannon with 0.8% or 660,000 shares and Champigny with 0.33% or 280,000 shares, according to Reuters.

The rest, 60%, is retail.

The company is covered by Laurentian Bank Securities' Barry Allan and Research Capital Corporation's Ryan Hanley. Newsletter writer Chris Temple of The National Investor also follows the stock.

Quebec Precious Metals has a market cap of CA$6.64 million and 83.4 million shares outstanding, of which about 71 million are free-floating. It trades in a 52-week range of CA$0.14 to CA$0.06.

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1. Quebec Precious Metals Corp. is a billboard sponsor of Streetwise Reports and has paid SWR a sponsorship fee between US$3,000 and US$5,000.
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Quebec Precious Metals Corp.
3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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