What potential do you see at the Thunder Bay North project?

Thunder Bay North is multi-ounce platinum and palladium magma conduit system, with high grade characteristics. We have recognized that this system has a lot of similarities structurally and stratigraphically to the Norilsk mining district in Russia and similar exploration techniques can be applied. It consists of two sub-horizontal conduits, one of which is the Current Lake deposit, with a 9.8 million tonne historic estimate that is currently being evaluated by Nordmin Engineering. 3 km west of this, we have been drilling off the Escape Lake deposit, a Rio discovery that is showing every bit of the potential and scale of the Current Lake deposit. Rio Tinto and Panoramic had collectively spent C$85 million on the project. Clean Air Metals has a strong operating platform as a result. We are not your average startup

How was the financing of the deal to acquire the property structured?

Benton made a C$3 million (50%) down payment to Rio Tinto in October 2019 to secure the deal in return for shares of Clean Air Metal and is a 17% shareholder of the company. In October 2020, Clean Air Metals made a C$1 million payment to Rio Tinto to maintain the Escape Lake option, and there are C$2 million in payments to Rio remaining over the next two years. Panoramic have transferred 100% ownership of Panoramic PGM’s (Canada) Ltd., now a wholly owned subsidiary and 100% owner of the Current Lake deposit to Clean Air Metals, subject to security on the remaining payments of C$1.5 million per year over the next three years going forward. Clean Air Metals has paid C$8.5 million of a C$15 million purchase price so far and we are funded to make the balance of those payments today. However, for the time being we are content to go with the installment plan and put our money in the ground to expand the resource. As we come to a definitive feasibility study on the Current Lake deposit we may elect to exercise the option with Benton Resources early by paying everyone out.

At the time of the negotiations, palladium prices had not taken off and it was trading at around US$1,500/oz. The deal was also relationship-driven, as Benton as a project generator has done various other transactions with Rio Tinto. These factors contributed to the very attractive purchase price.

Where are you targeting exploration efforts for the rest 2020 and early 2021?

We are developing the Current Lake deposit, which is currently a historic estimate. The mandate to Nordmin Engineering was to deliver an initial resource validation under NI 43-101, which we expect by Q1 2021 and a Preliminary Economic Assessment or scoping study in Q2/21. In addition, we have the Escape Lake deposit which is currently being delineated.

We believe that the 30,000-hectare Thunder Bay North project land package holds significant greenfield potential as well. Drawing upon techniques used in the Norilsk mineral massive sulphide deposit model, we applied audio-magnetotellurics (a low frequency resistivity system) to the feeder zone areas of the Current Lake and Escape Lake intrusions, where they are underlain by the Escape Lake fault. As a result, we have discovered heretofore unknown low-resistivity, high-conductivity anomalies, which we will be drill testing.

Can you elaborate on the partnership with Lakehead University that was announced in September 2020?

We funded the Lakehead University Geology Department to the tune of C$150,000 over the next three years, which they were able to leverage with a federal government National Science and Engineering Research Council (NSERC) grant for an additional C$300,000. The funding will be used for research into the Mid-Continent Rift, a large Proterozoic structure which is the big picture localizer of magmatism and resultant Nickel-Copper-PGE mineralization in the Thunder Bay area, with specific reference to the Thunder Bay North property.

Is the medium to long term plan for the project to engage in M&A or actually build the mine?

What sets Clean Air Metals apart is project quality and the C-suite, in which we have an exploration geologist and a mining engineer of some repute and experience as senior management. We can credibly say that not only are we going to explore and delineate the project, we have the experience and track record to build it. Presently our base case is a high-grade, underground, ramp-access mining operation at the Current Lake deposit and that is the mandate for Nordmin Engineering’s design team. By way of example, the previous study by AMEC for Panoramic was a desktop open-pit model with a 9 to 1 strip ratio that needed to move a lake. We have taken a fresh look, gone underground and reduced the deposit model block size to focus on high-grade mineralization. The PEA will include a stand-alone processor on site.

There is competitive tension in the region. Impala Canada’s Lac Des Iles mine is located 60 km up the road, and Lundin Mining’s Eagle deposit, also in full-scale production, is on the south side of the Lake Superior basin.

At the end of the day, public companies are for sale every day. We will see how M&A in the region plays out, but importantly Clean Air Metals has the flexibility and experience to develop the Thunder Bay North project itself should this be justified according to optimized engineering solutions.