Interview with Gavin Ferrar, CEO of Central Asia Metals PLC

Our previous interview: https://www.cruxinvestor.com/posts/central-asia-metals-lsecaml-plugging-into-profits-and-growth-in-the-base-metals-sector-6334

Recording date: 1st April 2025

Central Asia Metals PLC (CAML), an AIM-listed base metals producer with operations in Kazakhstan and North Macedonia, has reported strong financial results for 2024. The company generated $214 million in revenue and nearly $102 million in EBITDA, achieving an impressive 47% EBITDA margin that CEO Gavin Ferrar described as "super respectable" for a mining company.

CAML ended the year with approximately $68 million in cash after generating just under $66 million in free cash flow. This strong financial position enabled the company to pay a generous full-year dividend of 18 pence per share, representing about 63% of free cash flow—significantly exceeding their stated policy of 30-50%. Ferrar explained this generous distribution as compensation to shareholders for the lack of completed M&A transactions.

Despite actively pursuing acquisition opportunities (with 13 NDAs and 6 site visits last year), CAML remains selective in its M&A strategy, focusing on base metals assets that would generate at least $50 million in EBITDA. The company's strong balance sheet provides flexibility for future acquisitions without necessarily requiring shareholder dilution.

Operationally, CAML has made significant progress at the Sasa mine in North Macedonia, where its paste backfill plant successfully operated for the full year in 2024, placing 240,000 tons of tailings back underground—approximately one-third of the total produced. The company is also completing a dry stack tailings plant, which will handle another 30-40% of tailings, eliminating the need for additional wet tailings facilities.

In Kazakhstan, the Kounrad operation continues to outperform expectations. The Eastern dumps, which according to the original 2012 plan should have ceased production years ago, contributed approximately 27% of the company's copper last year. With production costs of 80 cents per pound against a copper price around $5, the operation maintains impressive margins.

CAML has developed significant expertise in its operating regions, with Ferrar strongly defending Kazakhstan as an investment-grade country with increasing Western capital inflows. The company's established presence provides strategic advantages in navigating permitting processes and accessing regional opportunities.

Beyond operational efficiency, CAML maintains a strong commitment to ESG initiatives, particularly in community engagement. The company operates its own foundation in Kazakhstan, making targeted investments including a center for disabled children, a facility for victims of domestic violence, and a recently refurbished youth center.

As CAML continues to seek transformative M&A opportunities, it remains focused on maximizing returns from existing assets, controlling costs, and maintaining operational efficiency to remain profitable throughout market cycles.

View Central Asia Metals' company profile: https://www.cruxinvestor.com/companies/central-asia-metals

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Interview with Adam Kiley, CEO of Frontier Energy Ltd.

Our previous interview: https://www.cruxinvestor.com/posts/frontier-energy-asxfhe-grid-connected-developer-eyes-major-role-in-was-82-renewable-push-6479

Recording date: 31st March 2025

Frontier Energy is advancing its Waroona Renewable Energy Project in Western Australia after being selected as one of four successful applicants for the federal government's $67 billion Capacity Investment Scheme (CIS). The scheme provides a crucial 15-year revenue floor guarantee, underwritten by the federal government, which helps secure debt financing by ensuring minimum revenue levels even during market downturns.

CEO Adam Kiley explained the significance: "What CIS does overall for projects such as ours is essentially an underwriting by the federal government for a contract of up to 15 years which provides a revenue floor for the project moving forward." The arrangement also includes a profit-sharing mechanism where Frontier would share 50% of profits with the government if energy prices exceed a certain ceiling.

The company is currently selecting a strategic partner from shortlisted candidates to help cover the equity gap and secure favorable debt terms. Kiley emphasized this would be "a partnership on the way through," not a takeover by a larger entity.

The initial Stage 1 project consists of a 120-megawatt solar facility combined with an 80-megawatt/4.75-hour battery storage system, expected to begin production in late 2027. This hybrid approach maximizes revenue by fully charging the battery daily and discharging during peak demand periods when prices are highest.

Frontier has substantial expansion potential on its 820-hectare land holding, with Stage 1 utilizing only about 300 hectares. Environmental spring surveys have been completed for the additional land, with Stage 2 potentially doubling the project size.

The project's timing aligns strategically with Western Australia's energy transition, as coal (currently 30% of the grid) is scheduled to be phased out by 2029. This creates an energy supply gap that Frontier is positioned to help fill. Additionally, grid limitations restrict how quickly new renewable energy projects can be developed, giving Frontier an advantage with their already approved connection points.

Frontier recently appointed Guy Chalkley as Chairman, bringing valuable energy sector experience from his roles as former CEO of Western Power and current CEO of Endeavor Energy.
The company sees 2025 as pivotal, with securing the strategic partnership representing "the big rerating event for this company," transforming it from a speculative renewable developer to a funded project with a clear path to revenue.

View Frontier Energy's company profile: https://www.cruxinvestor.com/companies/frontier-energy

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Our previous interview: https://www.cruxinvestor.com/posts/record-metal-prices-creating-mining-acquisition-wave-6893

Recording date: 31st March 2025

Resource nationalism and political risk have emerged as critical considerations for mining investors, particularly as jurisdictional differences in permitting timelines create significant competitive advantages. According to industry executives Samuel Pelaez and Derek Macpherson of Olive Resource Capital, these factors are reshaping investment strategies in the gold-copper sector.

Western Australia stands out as a premier mining jurisdiction globally, with permitting processes taking just 1-2 years compared to the 5-10 years historically required in the United States. This efficiency creates substantial economic advantages for projects in favorable regions.

Recent developments in the U.S. mining sector could transform this dynamic. President Trump's Mineral Production Order aims to expedite mining permits, potentially triggering what experts describe as a "renaissance in U.S. mining" over the next 3-4 years. Companies including Mako Mining, Minera Alamos, and Trilogy Metals are already positioning themselves to capitalize on this regulatory shift.

While rule of law is considered a binary factor in investment decisions, executives emphasize it can change unexpectedly. Mali, Panama, and Bolivia demonstrate how previously favorable jurisdictions can quickly become challenging. As Macpherson notes, "We want things to stay the same," highlighting investors' fundamental desire for stability.

Beyond the U.S., several jurisdictions are gaining favor. Guyana's recent oil discoveries have funded infrastructure improvements while creating demand for job-producing mining projects. Brazil continues demonstrating reasonable permitting timeframes, while Morocco has emerged as a surprising new mining destination.

The discussion emphasizes that resource nationalism impacts strategic metals like copper and rare earths even more significantly than gold, creating opportunities for projects in western jurisdictions as nations seek to secure domestic supply chains.

For investors, the implications include prioritizing projects in stable jurisdictions with efficient permitting, considering the timing advantage for U.S. projects under the current administration, evaluating management teams for jurisdiction-specific experience, and distinguishing between risks to developers versus producers.

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Interview with Paul Atherley, Chairman of Pensana PLC

Our previous interview: https://www.cruxinvestor.com/posts/pensana-pre-confident-funding-is-imminent-2582

Recording date: 28th March 2025

Pensana PLC, chaired by Paul Atherley, has secured financing to begin construction on one of the world's largest undeveloped rare earth projects in Angola. The project will process 20,000 tons initially, eventually scaling to 40,000 tons, placing it in the same league as industry leaders Lynas and MP Materials.

The financing package comes from three key institutions: Angola's sovereign wealth fund (FSDA), Absa Bank from South Africa, and the African Finance Corporation. The structure consists of approximately 60% debt and 40% equity spread across these institutions. The equity component is expected to be drawn down within weeks, while the debt documentation will take 6-9 months to finalize.

What distinguishes Pensana's approach is its focus on creating a non-Chinese rare earth supply chain. Rather than simply mining and exporting raw materials to China, the company plans to produce a mixed rare earth carbonate (MRE), a midstream product that can be processed further outside China. The company is in discussions with potential partners who have separation capacity outside China, which Atherley describes as "a very important step" in creating an independent global supply chain.

The Longonjo project contains over 100,000 tons of valuable neodymium and praseodymium in its top 30 meters, with an exceptionally low strip ratio of 0.2:1, indicating efficient mining potential. Technical validation has been completed through extensive testing at laboratories in Western Australia, confirming the quality of their product.

Construction is now beginning, with first production targeted for the end of 2026, followed by a six-month ramp-up period to reach full production in 2027. The financing will dilute Pensana's ownership from 84% to 70% initially, with potential further dilution to 52% if certain mezzanine financing is not refinanced.

Atherley sees significant growth potential as the company is "building a project at the bottom of the rare earth price cycle," contrasting their current $100 million market cap with Lynas at $4 billion. He highlights future demand drivers including electric vehicles, wind turbines, and emerging technologies like humanoid robotics.

As Atherley notes, "It's an electric future based on electromagnetics and we will be a producer going into that rising thematic."

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Interview with Charlie Regan, Director & CEO of NerdsOnSite

Recording date: 28th March 2025

Nerds On Site (NOS) is a publicly traded Canadian technology services company with a U.S. subsidiary that provides comprehensive tech and cybersecurity services to small and medium enterprises (SMEs). Led by Charlie Regan as CEO, the company currently generates approximately CAD $11-12 million in annual revenue.

Operating with a lean structure of only 7-8 employees, NOS leverages a network of 150 independent contractors who deliver services to approximately 13,000 clients annually across over 117 industry verticals. The company's client base is divided into three main segments: small office/home office (20% of revenue), SMEs (50%), and enterprise clients (20%), including Canadian Tire with 550 locations and a Florida-based bank chain.

NOS's primary offering is a cybersecurity solution with a preventative approach that distinguishes it from competitors. According to Regan, "We fortify the house so that nobody can get in," rather than removing threats after breaches occur. This solution has been deployed for 13 years across millions of devices without a single successful ransomware attack, and is sold with a 60% markup margin.

The company recently launched NOS Technical Services, a U.S.-based division targeting state governments and pharmaceutical companies with specialized technical talent placement. Regan expects this division to match the revenue of their core business within 2.5 years, projecting $4-5 million in revenue by the end of 2025.

NOS's sales approach includes real-time demonstrations of security vulnerabilities, showing clients data being transmitted to countries like North Korea and Russia. The company also recently launched "Nerds Online," a 24/7 support service priced at CAD $39.99 per month, targeting both existing clients and prospects who couldn't afford their higher-priced offerings.

Currently, NOS reports 7.5% revenue growth over the previous year and aims for 10% growth this year. Management is targeting a gross profit margin of 32.5% (currently about 3 points away) to become "comfortably profitable" by the end of 2025.

The company's growth strategy includes pursuing acquisitions of managed service providers (MSPs) in the U.S. whose owners are approaching retirement age. NOS plans to upgrade these clients to a higher-level managed security service provider model by implementing their cybersecurity offerings, with at least one acquisition planned before the end of 2025.

As cybersecurity concerns grow and organizations shift toward specialized technical contracting, NOS appears positioned to capitalize on these market trends with its preventative security approach and flexible service model.

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Interview with Hugh Agro, President & CEO, and John Meyer, VP Engineering & Development of Revival Gold Inc.

Our previous interview: https://www.cruxinvestor.com/posts/revival-gold-tsxvrvg-positioned-for-a-rising-gold-market-in-2025-6478

Recording date: 31st March 2025

Revival Gold recently released results from the Preliminary Economic Assessment (PEA) for its Mercur gold project, showcasing strong economic potential with projected annual gold production of 95,000 to 105,000 ounces over a 10-year mine life. At a gold price of $2,175 per ounce, the project demonstrates a Net Asset Value (NAV) of $294 million and a 27% Internal Rate of Return (IRR) after tax. These figures improve dramatically at current gold prices of $3,000 per ounce, with NAV increasing to $752 million and IRR to 57%.

The project features modest upfront capital costs of $208 million and competitive operating costs with Cash Costs of $1,205 per ounce and All-in Sustaining Costs of $1,363 per ounce. The resource base consists of approximately 1.4 million ounces of gold, with over 50% in the indicated category, an average grade of 0.6 grams per ton, and metallurgical recovery rates averaging 75%.

A significant advantage of the Mercur project is its location on private patented claims just an hour from Salt Lake City, Utah. This allows for permitting through a state process rather than federal, potentially streamlining the timeline to approximately two years. The strategic location provides ready access to equipment, services, and skilled labor without requiring a camp or remote-site logistics.

The company has outlined a two-phase development approach, with the first phase involving drilling to convert inferred resources to measured and indicated categories, along with collecting metallurgical samples. The second phase will focus on completing a Pre-Feasibility Study and advancing permitting. The combined budget for these phases is approximately $8 million, with potential construction beginning within 2-2.5 years.

Technical risks are mitigated by the project's brownfield status, as the site has been previously mined. Environmental factors appear favorable with no perennial streams, deep groundwater, and no threatened or endangered species identified. The heap leach processing method eliminates the need for tailings facilities, reducing environmental footprint.

Revival Gold's overall portfolio now includes both the Mercur project and the Beartrack-Arnett project, representing a combined resource of approximately 6 million ounces of gold. With a current market capitalization of approximately $50 million, the company is trading at just 0.1x NAV and $8 per ounce of gold resource, suggesting significant potential for value appreciation as the projects advance.

View Revival Gold's company profile: https://www.cruxinvestor.com/companies/revival-gold-inc

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Interview with Christian Ervin Easterday, Managing Director & CEO of Hot Chili Ltd.

Our previous interview: https://www.cruxinvestor.com/posts/hot-chili-asxhch-2blbs-of-copper-is-achievable-attractive-6668

Recording date: 31st March 2025

Hot Chili Limited has revealed a dual-track strategy leveraging a potential billion-dollar water business to finance its flagship Costa Fuego copper project in Chile. The company recently released prefeasibility studies for both its Huasco Water project and Costa Fuego copper development.

The Huasco Water initiative, a strategic asset developed over 20 months, consists of two stages. Stage one involves seawater supply to Costa Fuego, with an estimated NPV of $120 million and a 19% IRR over a 20-year supply period. The second stage encompasses a scalable desalination business with a potential post-tax NPV of approximately $1 billion, serving the broader Huasco region.

"This is about moving $150 million of capital from our copper project and putting it into that water project," explained Managing Director and CEO Christian Easterday. The company holds a unique position as one of only two companies in the past 18 years to secure maritime concessions for seawater extraction in Chile's water-scarce Atacama region.

The Costa Fuego copper project itself shows promising economics with a $1.2 billion post-tax NPV, 19% IRR, and $1.27 billion initial capital requirement. The project is designed to produce approximately 95,000 tonnes of copper and 50,000 ounces of gold annually over a 20-year mine life, with competitive cash costs of $1.38 per pound.

Easterday highlighted the project's competitive positioning: "We've delivered a top quartile production capacity project outside of the hands of a major and the lowest quartile capital intensity of a developer outside the majors."

The company's financing strategy includes traditional debt, precious metal streaming, offtake agreements, and strategic asset monetization through the water business. The project economics show a 4.5-year payback period, with projected revenues of $17 billion and free cash flow of $4 billion over 20 years.

Hot Chili is actively engaged in discussions with potential strategic partners, benefiting from the scarcity of large-scale copper projects globally. "When there's only five of you, the list gets smaller," noted Easterday, referring to the limited number of comparable projects available for development.

This strategy comes amid record copper prices, which recently hit $5.38 per pound, creating a favorable backdrop for advancing the project in a market characterized by a 4.5 million ton deficit and intensifying competition for high-quality copper assets.

View Hot Chili's company profile: https://www.cruxinvestor.com/companies/hot-chili-limited

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Interview with Shaun Bunn, Managing Director, Empire Metals

Our previous interview: https://www.cruxinvestor.com/posts/empire-metals-loneee-massive-titanium-exploration-target-with-150-year-supply-potential-5528

Recording date: 27th of March 2025

Empire Metals has discovered what it claims is the world's largest titanium deposit in Western Australia, with an exploration target of approximately 26-32 billion tons of ore. The company is positioning itself as an emerging player in the global titanium market with this strategic discovery in a tier-one mining jurisdiction.

A key advantage of the deposit is its weathered surface cap extending 60-80m deep, representing 4-5 billion tons of easily accessible, friable ore that requires no drilling or blasting. This natural feature significantly reduces potential mining costs as there is no overburden or waste to remove.

The company has already achieved early success in metallurgical testing, producing a 92% titanium dioxide product that contains none of the deleterious elements such as uranium, thorium, chromium, or heavy metals that typically plague other titanium sources. This gives Empire's product a significant competitive advantage in the market.

Unlike traditional titanium sources that rely on ilmenite processing, Empire's deposit contains titanium dioxide minerals that require approximately half the acid for processing – about one ton of acid per ton of mineral versus two tons for ilmenite. The company aims to produce high-value, pigment-grade titanium dioxide rather than intermediate concentrates.

Empire Metals is currently working toward a JORC-compliant mineral resource estimate, focusing initially on a smaller high-grade area of the massive deposit. The company recently completed a drilling program in February 2025 with 84 holes on a 100x100 meter grid, which will be expanded in the coming months.

The project benefits from a favorable permitting environment as it's located on private farmland in Western Australia's wheat belt, avoiding native title issues or crown land complications. This location, combined with the strategic importance of titanium for defense and aerospace applications, could enable fast-tracking through the approvals process.

With £4.8 million in cash, Empire Metals is well-funded to advance its development plans. The company expects to move toward production relatively quickly by industry standards, with potential revenue generation possibly beginning by 2026.

As Managing Director Shaun Bunn summarized: "If you wanted to find the perfect source to go and change and disrupt the industry and be able to produce titanium at a lower cost and a higher quality, this is the ore body that you needed to find."

Learn more: https://www.cruxinvestor.com/companies/empire-metals

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Interview with Simon Marcotte, President & CEO of Northern Superior Resources Inc.

Recording date: 28th March 2025

Northern Superior Resources is positioning itself as a key player in Quebec's Chibougamau gold camp, where the company has been leading consolidation efforts in what CEO Simon Marcotte believes will become "the next big gold camp to emerge" in Canada.

The Chibougamau camp currently hosts approximately 12.5 million ounces of gold resources between Northern Superior and IAMGold, with substantial growth potential. What makes this district particularly attractive is the proximity of multiple deposits to each other, creating an opportunity for a hub-and-spoke operation where several deposits could feed a single processing facility.

Northern Superior's flagship Philibert project currently hosts about 2 million ounces at 1.1 g/t gold. Marcotte emphasizes that by increasing the cut-off grade slightly, the grade rises to 1.3 g/t while only losing about 10% of the ounces. This gives Philibert significantly higher grade than IAMGold's nearby Nelligan project, potentially positioning it as the ideal "starter pit" for the district.

The company is currently conducting a 20,000-meter drilling campaign at Philibert, which has already yielded promising results, including a 26-meter intersection grading 2.6 g/t gold located 200 meters east of the current pit design.

Northern Superior sees multiple strategic pathways forward, including possible acquisition by IAMGold, forming a joint venture with IAMGold, attracting another major producer as a partner, or developing a standalone operation. Marcotte believes district-wide consolidation is inevitable, stating it "makes too much sense to wrap all projects together somehow not to do it."

In a separate strategic move, Northern Superior recently spun out its Ontario assets into ONGold Resources while maintaining a 62% ownership stake. ONGold's key assets include the TPK project and the Monument Bay project (3 million ounces at 1.2 g/t), the latter now in partnership with Agnico Eagle.

Management and key investors collectively own 25% of Northern Superior, creating strong alignment with shareholders. The team includes CEO Simon Marcotte, Chairman Victor Cantore (known for success with MX Exploration), and largest shareholder Michael Gentile.

As the gold sector experiences improving market conditions, Northern Superior appears well-positioned to benefit from increasing institutional interest in the junior gold sector and the growing appetite for quality assets in stable mining jurisdictions like Quebec.

View Northern Superior Resources' company profile: https://www.cruxinvestor.com/companies/northern-superior-resources-inc

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Interview with William Sheriff, Executive Chairman of enCore Energy Corp.

Our previous interview: https://www.cruxinvestor.com/posts/wyoming-uranium-companies-at-heart-of-the-us-nuclear-revival-5749

Recording date: 28th March 2025

enCore Energy stands at a pivotal moment in its corporate journey, emerging as one of only two uranium producers in the United States at a time when domestic production capabilities carry increasing strategic importance. The company has recently undergone significant management changes, with the board deciding to replace CEO Paul Dorenson to refocus priorities from the building phase to production efficiency.

Executive Chairman Bill Sheriff characterizes this transition as necessary to instill a greater "sense of urgency" throughout the organization. "We are changing the culture and the culture starts from the top down in any organization," Sheriff explains. "A sense of urgency doesn't mean panic, it means motion. You need to keep things in motion."

The company's In-Situ Recovery (ISR) operations in Texas present an unusual technical challenge – the recovery process works exceptionally well, with over 80% of uranium recovered within just four months. This creates what Sheriff describes as a "double-edged sword" – rapid cash flow generation coupled with the need for continuous drilling to maintain production levels. The company's challenge has been keeping drilling activities paced appropriately to offset the steep production decline curves.

This production profile differs significantly from typical ISR operations, which generally see recovery spread over 12-15 months. Sheriff compares the situation to natural gas from fracking: "You get several months of joy and then it tails off very quickly. You don't get any less product, you just get it a whole lot sooner."

The management reset coincides with enCore implementing several strategic initiatives. The company has eliminated uranium spot market purchases to fulfill contracts – a practice that previously resulted in financial losses when buying at higher prices than contracted sales prices. Sheriff confirms: "Looking forward in 2025, all projections are we will not buy uranium in the spot market to deliver into our contracts this year."

Cost optimization efforts are underway, with the company "rationalizing every position and every expenditure." Production costs were approximately $40 per pound according to recent filings, with management confident in their ability to improve this metric. The company has also divested its New Mexico assets to concentrate resources on production-stage projects in Texas and South Dakota, adding approximately $30 million to its balance sheet through asset dispositions.

For investors, enCore represents a rare opportunity to gain exposure to actual uranium production in the United States. While the company has faced operational challenges, its focus on efficiency, cost control, and production growth positions it to potentially benefit from improving uranium market fundamentals. As Sheriff notes: "If you're looking at it as a race, we've got a heck of a head start over those that aren't in production or those that aren't even permitted yet."

Investors should monitor upcoming quarterly reports for evidence that operational improvements are translating into enhanced financial performance. With many competitors facing significant hurdles to reaching production, enCore's status as an active producer with cash flow provides a meaningful competitive advantage in an increasingly supply-constrained uranium market.

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View enCore Energy's company profile: https://www.cruxinvestor.com/companies/encore-energy

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