translation of interview on canal argent Q.: First, talk to us about the company, CRE, since when are you existing and what are your major projects?
A: Cre is a society created in 2006, and the principal asset is the Rose project situated in the Baie James, project of lithium-tantalum. The company is now in transition from exploration to the development of a mining project.
Q. So what you are telling is that you are in exploration phase and you are near a production phase, that’s it?
A.: The exploration is completely finished, we really are at a step where we bring the project to the development, the construction of a mine, to do the production of lithium and tantalum.
Q.: For the use of lithium, it’s OK, but tantalum, what is it?
A.: Tantalum is a metal that have specifics characteristics used in capacitors, the capacitors are used in all electronics devices, phones, Iphones, Ipads, computers, that’s what is permitting the miniaturization of electronics devices.
Q.: You have recents results for the potential of the Rose project, what is this potential?
A.: We published just before Christmas an economical study, produced by Genivar, that shows a net present value, with a 8% discount rate, of 488 000 000$ before taxes, and a rate of return of investment of 33% before taxes.
Q.: What are the concrete markets for that?
A.: Actually, the big markets for lithium are Asia, United States, the market is focused on car batteries, and all the market of energy accumulators, giants batteries associated with wind mill (éolienne), solar energy, to accumulate energy helping to decrease demand of electricity on the electric network during rush hour, that is for lithium. For tantalum, we are speaking in the united sates, Apple, Blackberry have a big demand for iphones. There is a big demand and the biggest producers are the Congo and Australia. For Congo, we talk about mineral ?conflict? (in English when JSL say it), an expression used in the industry for a mineral that the benefits are used to finance war. Companies are looking for safe supplies without those conflicts.
Q.: Does Canada is present in this market?
A.: Quebec is a major player in the lithium market. There is a few other projects going on. For tantalum, only one project was in production, it’s the Tanco mine in Manitoba. The project is actually closed. There is no other project.
Q. :What is the supply and demand actual situation?
A.: There a demand for about 8 000 000 lbs /year for tantalum and the production at 4 000 000 lbs. So there is a shortage at this level.
Q.: What are the stages before going fully production?
A.: Exploration and economic study are finished. For the moment we are at the feasibility. We just begin feasibility study. So the full next year will be to the development of the study, to arrive at a decision to build, we hope end of 2012, or starting 2013, to begin a full starting production in 2015.
Q.: Obviously you are part of the Plan Nord, in what way does it help, in a matter of financing, to advance your projects?
A.: The Plan Nord will help us very much with the communication between various parties, for the faisability or the project financing when we will arrive to the construction.
For the financing by debt, infrastructures, that is where the Plan Nord will help us.
Q.: You have Jean-François Meilleur that just enter in the company, he will mainly be responsible of the development, communication, marketing and financial development.
A.: The company is a young company, little known, and JFM will be in charge of meeting the financial market, and the marketing to assure the company to be known by the financial market.
Q.: Being already is the stockmarket, I imagine that there is a work that has been done with big investors, what is the reception?
A.: We have a very good reception, we went many times to Vancouver, Toronto, New York, the project is very well received, it’s true that at this point, the big steps are the faisability, and the project financing. It is special metals, it’s not like gold or copper, they are not metals that are traded on a price fixed by the market, it’s really a private market with future (contrat à terme) and the day we will arrive with a future (contrat à terme) with a potential buyer, it will really help the society.
Q.: If I understand, you decide a fixed price (with the buyer) so it get easier to predict and to know the money that will going in. It doesn’t fluctuate. A.: Yes that’s it.
Q.: Since when are you in stock market?
A.: 2006. Since the company starts.
Q.: I see that the stock price is actually at 0.16$ but in the past, it went to 0,70$, it there a possibility of financing by releasing stock shares, considering your projects?
A.: Actually, the company is looking for a non-dilutive financing. We have discussions with partners to permit financing entirely the feasibility study without releasing stock shares.
Q.: Did you approach the American market, American investors?
A.: A little bit. We begin. It is something that never have been done before by the company, that we are working actively now, that is part of the companie’s vision.
Q.: Could you go looking in Asia, I imagine that the approaches are more complex and take time, but could you reach foreign investors?
A.: Certainly, big lithium and tantalum consumers are in Asia. And we just added two new members to the board directors, Ron MacDonald and Mark Baggio. They often goes to Asia, they well know the lithium and tantalum market, they will work hard to find asian partners to help financing the project.
Q.: What are the biggests risks when you begin a feasibility study? Is it that you find that it will costs much more than you thought or that you will not find the content of product that you was thinking you had?
A.: The biggest risk was the exploration. Now that the exploration is over and that the economical study still strong enough, (hesitation, JSL don’t seems to know what to say)
Q.: Finally your objective when you do this study, is to evaluate costs and benefits.
A.: It’s to increase the accuracy of the economical study, we will bring the accuracy to +/_ 10%, and to start procedures for permits, financing, sign contracts with buyers.
Q.: If we put us in place of a shareholder who would want to buy shares at 0.16$, for him we are at a feasibility stage and it is not necessarily a winning game for sure, we are not in production stage, so the risk is that the project is not so profitable than expected. Is that the way we should see it?
A.: At the profitability level, there is no real problem because of the future (contrat à terme), we are part of the Plan Nord, we are in Quebec, under good jurisdictions, we want that the project stay 100 % Quebecer. There is no real risks at this point.
Q.: You are a geologist by formation, you are the president of the company, it’s a family story, father and grandfather geologists , an experience that you have since a long moment despite your age.
A.: Yes, at the age of 10, I was going on drill, with my grandfather and my father, so I’m in the business since a long time, it’s a passion.
Q.: You feel the good mood for companies like yours with the Plan Nord that is popular here but also all around the world with economic missions?
A.: It helps very much, there is many people asking about it, even outside Quebec, at Toronto, in United States.
Merci, Thank you.
I'm french speaking so it's possible that there is some mistakes, but at least you should be able to understand the meaning of what he said.
In at 0.40$.
ready to wait for 20.00$ !!!
I keep dreaming.