 Hello everybody, welcome back to Investor Intel. I'm Peter Clausi. Today, we're talking with Imperial Mining Group, Peter Cashin and Gianni. Gianni, my first time chatting with you, so nice to meet you. Very nice to meet you virtually, Peter. Where are you today? I'm in the Bahamas. It looks nice. Locked down, like everyone's locked down. I got stuck here, so it's okay. I'll figure it out until the snow stops flying. Yeah, you'll be all right. So, Scandium is an interesting metal, number 21 on the periodic table, but often lumped in with the rare earths. Why is that? You know, a friend of mine, Don Cox, he's a famous investor from Chicago, Illinois, and he always told people, never invest in the story on page one. That's the efficient market. Invest in the story on page 16 that's headed to page one above the fold. We all know about energy savings, the Green New Deal, electric cars, but in reality, when you're talking about energy savings, there's many things that come together. One of them, which is sort of the less talked about, but is making things very efficient, even if it's the internal combustion engine. When you're moving heavy things, if you can move light things, meaning use more aluminum instead of steel. There's a huge benefit for society and the aluminum market, of course, is global, it's massive, but what does it take to make it possible? These are specialty metals, rare earth elements, and people will start to see, as I said in my opening little parable, you're going to start seeing not just rare earth elements, but you're going to see these individual components that are so very important throughout this pivot towards hyper-efficient products, machinery, and the most important one. And I cannot underline this enough. More than all the other ones, you are going to see on page one in global publications, the word Scandium. Scandium is a market that, in my opinion, in this decade can grow 20-fold. There's no commodity that's going to grow 24, 2,000% I'm talking about, and this is what hopefully I've captured the imagination of people watching this program. That's what we're going to talk about over the next 15, 20 minutes. So the current global market for Scandium is about $60 million a year right now. So where do you think it's going to go? Well, I think with the construction of the market, for the most part, it's the availability of supply. There just is not enough production capacity in the world to be able to satisfy it, but the potential growth demand could be going forward. We've looked at a bunch of things. We've done a lot of strategic marketing in the area of Scandium as it applies to Scandium aluminum alloy and light weighting, high strength, and resistant applications in the automotive industry, in the aerospace industry, the defense industry, solid oxide fuel cells. It's astronomical where the consumption demand could be, but there hasn't been a large enough primary supply of the material to satisfy the demand. So it's like the rare earth loop. You don't have demand till you have supply, but you can't have supply till you have demand. It's somewhat, but it's a little bit different. It's like anything else. If you can find the supply, I think the players and the consumers are there waiting for it. And as soon as you can give a signal that there is a sustainable supply coming out from a stable jurisdiction such as Quebec, Canada, I think that you're going to start seeing some interest growing in the sector. And as an example, I just participated in a press conference. The Quebec government is inputting $850,000 Canadian to Rio Tinto, Iron and Titanium towards the building of their demonstration plant. Now, what they're doing is they're going to be recovering bi-product Scandium from their waste streams of their titanium operation. And then because of their affiliation with the Rio Tinto's L-CAN, they're going to make Scandium aluminum alloy. So they're vertically integrating into their own production? They are vertically integrating. And as soon as there's an indication of a major putting their flag up and saying, okay, we're in, they've done their marketing studies. They see that the potential growth opportunity in this area is massive and they want to participate in it. And it's a major. That was the one thing that was lacking in the rare earth area. None of the majors expressed interest in supporting the development of our earth property. And before I forget, we would be remiss in having a Scandium conversation without mentioning George Putnam, who has been carrying that flag a very, very long time and is finally getting to see his projects come to fruition. John Kaiser, for that matter. Kaiser Research has been supporting George well before the even people knew how to pronounce Scandium. So what then are the primary uses for Scandium today? It's a lightweighting material in very small quantities, less than a percent. Usually around 0.4, 0.5 percent can strengthen in conventional aluminum alloys about three times. It also renders corrosion resistant and it also makes them temperature resistant because there's always an issue with alloys in high temperature applications that they recrystallize and they lose their their strength characteristics. Scandium aluminum maintains all of those things. So, you know, think about like Janio outlined the automotive industry is looking for a lightweight high strength product input to replace steel to make their vehicles lighter. Can we make airplanes lighter? Helicopters? Airplanes. Airbus already has multiple patents on Scandium aluminum alloy. One they call Scalmaloy because it's a Scandium aluminum magnesium alloy and they've just announced a new alloy that replaces the magnesium for chrome with chrome and it's used in the laser melt 3D printing applications. Really? That's a huge market. That's interesting. Johnny, what do you know about the 3D printing? Well, 3D printing is something that there are countless thousands of people working in that sector. I am no expert on 3D printing, but I do know that it does require specialty materials depending on what it is and how these things are printed. And you can just imagine rather than shipping parts, you can print parts. How many different little digits and gizmos go in all the machinery around the world? Your imagination cannot be broad enough to how big that market could possibly be. And thank you for mentioning John Kaiser. In my opinion, he's one of really the experts in this field. And I was picking his brain a little bit on when I became captivated by this space and I wanted to follow this. I also like to be what they call a futurist. I want to talk about these things before they're popular. And I'm not doing this because I feel I want to look like a jerk five years later. I mean, I really believe this is unstoppable. If you have large quantities and these are still small amounts of material that come out of these deposits. But anyways, if that was to grow, like I said before, in this decade, 2,000%, there would be, in my firm opinion, the take up from the aluminum industry. And we fortunately, you know, Canada and Quebec has a very large aluminum industry. So it's a natural fit. The question is, are there primary Scandium deposits in a place like Quebec or Norway or Iceland or wherever you have large aluminum production capacity? Well, we all know Quebec is one of the largest aluminum markets in the world. So your research quickly comes down to those deposits. And you can also maybe touch on that, Peter, Australia, and maybe some of the other deposits that have been deemed to be primary in Scandium. But then it comes to metallurgy. And there are two types of metallurgy, one that's more complicated or more difficult to get these lower concentrations of Scandium or rare earth elements out, and one that's easier. And so I think that my research coming into Imperial, it lends me to believe and understand that they got location, they got the right commodity, but they also have some of these positive attributes. And I think it's important for you to maybe touch on that, Peter. The January pointed out that the Australian examples are laterites, and they're very different from our project, which is a hard rock, open pit, hard rock opportunity. The metallurgy is completely different. The application of metallurgy that's required for lateritic deposits is a little bit more complicated. Usually requires auto plays and high pressures. Whereas we're looking at something that's way more conventional. Rightly pointing out that size is important, grade is extremely important. I think what's lacking in Australia, I think, is the aluminum production capacity, but really it doesn't matter. What those Australian players could become is an important factor to the diversification of the supply chain of Scandium. So they would cover off on different markets. And the consumers are looking for diversification as well. They don't want to come to a single source, critical materials such as Scandium. Who are the consumers? God, the defense contractors, the aerospace guys, Bloom Energy in California is patented Scandium input in their solid oxide fuel cells so that they actually run at a lower operating temperature. The automotive industry, the luxury automotive industry, I mean, I think luxury automotive has higher margins so they're likely able to tolerate, you know, higher cost inputs for light weighting. EVs as well. I mean, everybody talks about battery chemistries and lithium batteries. And a lot of R&D is going into that area. But automotive manufacturers for the most part, although they're learning how to build a battery. They're not battery manufacturers. They know heavy industry. They don't know heavy manufacturing. So you tell them, look, I've got a material that is going to significantly lighten up your chassis and your vehicle and allow your batteries to get better range. They're in. They're all in. So where else in the world is Scandium found? The stupid question of the day is it actually in Scandinavia? It was discovered in Scandinavia. But the primary producers are China as byproduct from rare tailings processing. And it was actually the Russians that discovered the benefit of adding small quantities of Scandium to aluminum for their early days of the advanced MiG fighter jet program in the 1970s. Because what they recognize is that, look, we don't have the access to the highly technical aerospace grade titanium alloys, but we've got the Scandium aluminum alloy. And guess what? It has the same performance characteristics. It's actually 40% later than titanium alloy. And what it does have is that it actually allows the alloy to have a little bit of flexibility, which titanium does not have. Titanium is very strong, but it's extremely brittle. And you can imagine taking a fighter jet up to Mach 5 and 6 or higher, you need that a little bit of flexibility or the joints in your parts start to crack. So that's a consideration. There was a podcast that said planes expand like six inches in flight. Yeah, exactly. It's amazing. Sorry, Johnny. Yeah, you were saying before this is like having a beer with three buddies. And I think what's very important for people to understand, most people that are watching your program, if they followed mining and junior mining, they would know that a high-grade gold deposit may have 10 grams a ton, where a low-grade would be 1.5 a gram a ton. High-grade copper, 2%, low-grade 0.2%. Peter, can you outline the difference? There are a few Scandium deposits, but please articulate the difference in grade of the ones we know about and what are your grades that you're finding so far, just so people have context. Okay, context is a good grade Scandium deposit is runs anywhere between 250 and 300 grams per ton grade. But those kinds of grades. Three grams? Grounds per ton. So like a third of an ounce. A third of an ounce per ton. If one converts that into $1,850 US gold per ounce, that runs about 8 to 12 grams per ton grade equivalent, gold equivalent of what we've intersected. And we've been intersecting quarter lengths in the order of 75 to 200 meters. So if we were a gold company and we were reporting 8 to 12 grams over 200 meters, I don't think we'd be a 15-cent stock right now. So what's next then? Do we just keep educating people until their wallets start to speak for themselves? I'll answer that as someone who buys junior mining shares. So I am a speculator. I said that I'm a bit of a futurist. I'm not doing this because I'm a nice guy. You own the shares and you think something's undervalued. So you're looking for it to have an appreciation. Maybe the market will really catch on and we end up with a mania. There's that always there. We saw Cobalt, you saw cannabis, you saw crypto, lithium, all the other different commodities that go into a mania phase. Will Scandium be there one day when it's on the front page? Maybe, not a negative. The second part of it is following news flow and understanding drill results. What does that mean? That's a good analogy you gave Peter if you put like in it to gold, but also what's happening? Is there drilling taking place? Will there be some kind of an economic study? And there's education once again. How do you compare that to something that maybe people that speculate in junior mining understand? Usually it's gold and it's copper. So what is the approximate capital expenditure that would be required roughly? I know the work has to be done, but is it 50 million or is it 5 billion, like a porphyry? This is important. People need to know these answers approximately and what kind of a facility are you building with or pursuing and what kind of product would come out of that and what are the rough numbers? I know the work has to be done, but I understand the second part of speculating with me, speculating an imperial, is because I understand there will be lots of news flow in the year 2021. You raise the money, the work is ongoing, and I like that where news is going to be delivered as far as I understand throughout this year. So maybe just explain to people those differences. Yeah, well, at least how we put together, we closed a nice financing over two and a half million dollars before Christmas. That was the minimum requirement for us to, because what we've done on the project, the complex that contains the Scannion Bering horizon is about six kilometers in diameter. We've actually traced the host horizon around for about 14 kilometers in strike length. We've defined three... So say that again, 14 kilometers of strike? Yeah. Wow. That's crazy. Yeah, correct. We've defined three, we know of three resource areas, three deposits, four others this summer. We've identified two new ones, and we've only drilled maybe 10 or 15% of the entire horizon. So now we're at the point where we know what the best resource is, because I wanted to make sure that we locked on to the best opportunity on the project. The highest grade could provide us with the largest tonnage, could be the most economic of anything we see on the project. We've identified that. This winter we're drilling. We're going to come out with a resource estimate in May. We've done our strategic marketing. Our metallurgies in the process is ongoing and should be completed by, I would say, February. And then we'll have the resource in hand. Well, those three items are required for the preliminary economic assessment. So we're ready to do a PEA. And that will be delivered in probably late July, August. Johnny, I see it's getting dark behind you. We're interfering with your dinner plans. Any closing thoughts? Well, I gave a keynote for a European bank yesterday, and it was titled, Global Energy is at a hinge of history. It really is a once-in-a-hundred-year pivot, just like the one when we went from Wood to Coal. I mean, it was groundbreaking, and also the petroleum age. And I'll give you one sound bite when they finally found oil in Saudi Arabia because they found it in Iraq and Iran and other places. But it was 1937-38 that they went there and they went and it was this huge discovery and they said that Harold Ikes, who was the Secretary of the Interior, sent the foremost geologist in America. And he arrived with his team, Dagolier, I believe was his name, and they reported back, Sir, Mr. Ikes, you don't understand. This is the single greatest prize in all of history, the oil in that region. And sure enough, it was. And we've lived in the oil age, but now we are going into the age of electrification. And this will be, like Robert Friedland would say, the revenge of the miners. So some of them are well understood, but I think the outsized gains are made by those stories that are not understood by the market or not appreciated by the market. And as they become more adopted, you know, rare earth elements has a lot of people pushing them right now. And so when we start to see things like niobium and for our discussion today, Scandium come to the front page, it's good to see, you know, people starting to talk about it. And I think it's going to be an interesting area to follow this year, next year, and we'll see what happens in the future. Oh, I'm intrigued. Mr. Cash, and it's always nice to see you. I always refer to you as the guy too nice for the mining industry. Yeah, I heard that. I got to get me near maybe. Imperial mining group with its Scandium properties in Quebec. There's a lot of news comics to stay tuned. I'm Peter Clausi, signing off from Investor and Tell. Have a great day, people.