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DEFENSE METALS CORP, HIGHBALLLER

Defense Metals (DEFN.V)

Investor presentation

Defense is developing its 1,708 hectare Wicheeda Rare Earth Element (REE) Project in the Prince George region of British Columbia.

REEs, often referred to as the ‘Vitamins of Chemistry’, are everywhere in this modern world.

Exhibiting an extraordinary range of electronic, optical and magnetic properties, they are used in everything from medical imaging technology, to flat-screen TVs, to nuclear power generation, to electric vehicle (EVs) batteries and motors.

If we look at EVs alone, the pace at which they are rolling of the assembly line will soon kick into a whole near gear as nations around the world demand a greater reliance on clean, renewable, and zero-emission energy sources.

But there is a problem with this increasing demand. China controls roughly 85% of the world's REE supply.

The West is scrambling to secure alternative sources.

Very recently, Reuters reported that the U.S. Army plans to fund construction of a number of REE processing facilities, part of Washington’s urgent push to secure domestic supply.

All of the above puts Defense Metals in an enviable position.

What Defense has is what the Western world needs

Defense’s Wicheeda project currently has an Inferred resource of some 11,370,000 tonnes averaging 1.96% Light Rare Earth Oxides (LREOs).

A recently concluded drilling campaign at the project tagged high-grade LREOs in every hole drilled (13 holes in total). And we’re not just talking about narrow intervals. We’re talking about long intercepts of high-grade material.

Examples:

A grade of 1% LREOs is the value equivalent of roughly 2.5 g/t gold (or USD $100.00 per tonne). Using that simple comparison, the 4.01% grade over 58 meters encountered in drill hole WI10-32 is equal to a gold hit of 10 g/t gold over the same length. So why didn’t the stock blast off and not look back?

The market doesn’t understand REEs. Yet.

Hole WI19-32 is a colossal hit, but it’s not a one-hole wonder. Check out the grades and widths across all 13 holes drilled this past summer in the table below.

The following graphic beautifully illustrates the positioning of each hole. Note how the deposit is expanding to the north, southwest and east.

The Wicheeda resource will almost certainly grow.

Obviously, the market doesn’t understand what Defense Metals has. If it did, the share price would be tracking significantly higher.

I see this is an opportunity to capitalize on an undervalued asset before the rest of the market catches on.

It’s also important to know that Wicheeda is being pushed aggressively along the development curve.

There are a number of catalysts in the offing that could drive shareholder value in the short to medium term. Chief among these:

  1. A resource update factoring in all 13 holes highlighted above is scheduled for Q1 of 2020.
  2. News from bench-scale tests and the construction of a pilot plant should come within the next few months (the company reported extremely positive metallurgical test results earlier this year—results that position Wicheeda among the very best REE deposits on the planet).
  3. A spring/summer drilling campaign designed to expand the Wicheeda resource and test other areas along the 1,708-hectare property will be announced later in the spring.

I’m expecting the market to gain a greater appreciation of Wicheeda’s subsurface mineralization and the strategic significance of this LREO deposit in mining-friendly B.C.

I urge you to take a closer look at this one. You can also access my coverage of the company, and the REE market, over at Equity Guru via the following link.