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Stockhouse investors know there is no denying the fact that the world’s industrial and economic future will be closely tied to lithium-ion batteries and the battery metals needed to build them.
But what a lot of investors and consumers may not know is that the vast majority of electric vehicle batteries contain manganese in their cathodes and require
high-purity manganese. Manganese is a metal with a multifaceted array of uses…especially as part of the electrification of mobility.
This is truly a rapidly growing metals & mining market that bears close attention from the investment community and consumers as a whole.
Enter
Euro Manganese Inc. (EMN) (
TSX-V.EMN,
OTCMKTS: EROMF,
Forum) – a well-positioned company that is currently developing its manganese resource in the business-friendly jurisdiction of the Czech Republic. The Vancouver, BC-based battery materials company is focused exclusively on the development of a new high-purity manganese production facility, based on the reprocessing of a tailings deposit strategically situated in the heart of Europe. The company stands to become a major producer of high purity manganese, without the adverse impacts of mining or the generation of new solid waste.
The project’s unique location and environmental attributes have attracted significant community support and customer interest.
Stockhouse Media’s Dave Jackson was joined, via Zoom video, by company CEO Marco Romero to discuss recent company news, what’s to come, and the immense opportunities that are available in the EV battery sector.
TRANSCRIPT BELOW:
SH: So to start off, can you tell us a bit about yourself and the history of the company?
MR: I call myself a veteran of the resource industry over 40 years. I’ve built a few really nice companies over my time and tend to do one of these roughly every 10 years. And this company is one that we started a little over five years ago and I've been single-mindedly focused on bringing on stream…what stands to become the only primary producer of high-purity manganese in Europe.
SH: Can you update our investor audience and your Euro Manganese shareholders on any new company developments?
Well, there's a lot, we're in a halt right now, and I'm not going to be able to address the reasons behind that halt. They will become self-evident next week. But I can tell you that external factors have really put some wind in our sails recently. Volkswagen held its Power Day, which is their version of Tesla's battery day. It was a two-hour long event at which they disclosed something that could be a game changer for us. And it is the fact that the majority of Volkswagen batteries are now expected to contain a high percentage of high-purity manganese in them. This is a very big event, especially coming from the world's largest automaker. There are many other things that I could elaborate on, but this is a project that is moving very rapidly now in the final stages of getting it ready for development. We’re in the middle of a feasibility study, we’re in an advanced stage of environmental permitting, and we're getting ready to install a demonstration plant on site, which is currently under construction. So a lot…a lot going on.
SH: In January, the Company announced the Chvaletice Manganese Project has moved to next stage of permitting process. Can you expand on this for investors and what they should be looking out for?
MR: Well, Europe is one of the most demanding jurisdictions in the world when it comes to environmental standards, regulations. So we are subjected to European Union standards in everything that we do in the Czech Republic. All the laws are harmonized, and we've been working now for almost four years on the permitting of this project. A lot of studies, design, planning around the impact of the project, and we filed our preliminary EIA, or Environmental Impact Assessment, in the summer of last year and early this year we received a very important screening report from the Czech Ministry of the Environment, which essentially gives us the green light to proceed to the final stage, which is called the final EIA. And we're now working hard to get that done by the end of this year. So that's a major thing and it feels really good.
The comments we got back were very benign, I’d even say supportive, and we have not experienced opposition to this project. There’s no NGOs or communities coming after us. On the contrary, this is a project that is quite positive for the environment, in that this is an old mine site that's polluted, and it's bleeding metals and salts into the environment. And in fact, we expect to clean it up and leave it in far better environmental condition than it is today. That's a major win for everyone. So it's going well on that front.
SH: You recently announced a strategic financing and support agreement with EIT InnoEnergy to help accelerate Chvaletice. This will be news to many investors. Can you unpack the benefits of this event?
MR: EIT InnoEnergy is mandated by the European Union, among other things, to help develop a European electric vehicle supply chain. It runs an organization known as the European Battery Alliance that brings together all the players, all the automakers, the battery companies, and an entire ecosystem of businesses around them. And we signed an agreement where they put a small amount of money initially into us, but more importantly they committed to helping us put together about 362 million Euros of financing in part, and hopefully largely from a variety of European Union funds organizations, whether they be granting bodies or lending bodies or other financial support organizations. It's a big thing for us. It's a major validation after quite a process that we had to go through.
SH: You’ve also applied for a O-T-C-Q-X market listing which is expected to improve access for U-S investors and increase liquidity. How so?
MR: I was surprised to find out recently actually that a lot of US investors have difficulty buying shares in Canada unless you're listed in the US and have an actual quotation in US dollars in the market maker. So realize that there's a great deal of interest from US investors in battery material companies and everything battery-related and electric vehicle related. And you know, we were advised that it would be a good thing to provide that access. After all, the U.S. is the world's largest equity capital market. So we're essentially making our company available as an investment to American individuals, institutions, and family offices.
SH: Recently, Volkswagen Auto Group staged a Power Day to outline its electrification strategy and made several big announcements. What are the implications of VW’s plans for Euro Manganese?
MR: Well, the implications are really big for Europe, but they're also important potentially for us. We saw on Power Day, Volkswagen announced that they plan to operate six very large plants, which if they were in production today would be the largest in the world. So imagine, six of the world's largest plants going up within a few years across Europe just to satisfy Volkswagen's internal battery requirements. And so that's very big. There was a very strong focus as well on building charging networks across Europe. Also a very strong focus on achieving economies of scale by having one, what they call unified battery format with varying chemistries in it, but so that they can standardize their production processes and approaches. And then of course the one that was music to our ears was a switch to a principal battery chemistry for their mass market cars that is high-manganese in content, which is revolutionary because it doesn't exist yet in the market. Manganese has been in batteries for a long time, but always sort of as a relatively minor player, anywhere between 10% to 33% in the battery. Now they're talking about a majority of the battery cathode being made of manganese. That's going to drive demand for these products, especially in Europe, where we stand to become the only primary producer. There is no other deposit like ours in Europe.
SH: The Company looks well positioned to play an important role in the European EV battery industry. Please tell us what you anticipate there.
MR: Well. growth, no doubt. The electric vehicle industry is seeing massive investments. Virtually every major automaker in Europe has committed to electrifying their entire fleet. It's unbelievable what's happening. Between 2030 and 2040, you will see the vast majority of vehicles made in Europe be electric vehicles. And that's being incentivized by government through funding to help the transition happening from internal combustion engines to electric motors and electric batteries. But you're also seeing it now pivoting towards the raw materials and building up a local supply chain. Now, you have to keep in mind that in a product like ours, for example, this high-purity manganese that we intend to produce – today, 93% of that production is coming from China. So Europe is wanting very much to see local production of these essential raw materials.
SH: For company shareholders and potential investors, what progress can we expect at your Chvaletice Project in 2021?
MR: Well, like I said earlier, we're very active right now. We have a feasibility study ongoing which we're targeting for completion later this year, same thing with the demonstration plant. That's under construction as we speak. And on top of that, the permitting, the completion of the final EIA is targeted for late this year. And in the meantime as well, there's some very active discussions, and even negotiations, that are ongoing right now with major industry players. These are companies in the chemicals and the battery and in the automotive sector that are looking for sustainably produced, European, high-purity manganese products. And I think we're very well positioned, and we may have quite a lot to say on that front.
SH: Marco, what’s the long-term strategy for the company moving into 2021 and beyond, and what investors should be looking out for?
MR: We want to deliver a reliable, sustainable, competitive producer of these high purity products in the middle of Europe. And we want to be able to serve our customers well, we want to be able to have the best quality products as well as a world-class environmental footprint. That's the big picture, but in reality, what we're after here is building a business, a solid business. And over the next little while a big part of our strategy is now going to focus on financing this project to commercial production, you know, subject to feasibility study, being made and commercial decisions, commercial production decisions, being made. We see ourselves as either remaining independent, or we may end up taking a partner in what we're doing. You know, this is after all a $400 million project. It's an ambitious endeavor, but it's the type of project we've done before as individuals. So we see a great opportunity. What we want to do is see it reflected in value for our shareholders. I am after all the company's largest shareholder. And you know, we've got a lot to gain from success here.
SH: And finally, Marco, if there’s anything I’ve overlooked please feel free to elaborate.
MR: No, no, this is great. This is a good opportunity to get our message across the Stockhouse community. Hopefully, they'll realize that you have a very committed team working hard to develop a unique asset. There's nothing like this anywhere in the world. And we have an opportunity unlike any I've seen in my long career in the industry. This is a project that feels really good, to produce these extremely important battery materials by recycling waste to make electric cars. That feels good. It feels very green to me.
To learn more about Euro Manganese Inc., visit their website at
www.mn25.ca.
FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.