Grid Battery Metals Inc. (OTCQB: EVKRF) can claim something that most nanocap minerals and metals exploration companies can't: being fully funded to advance exploration initiatives throughout its next fiscal year. That's a rare achievement in a sector where costs can be tremendous. But as valuable to having that advantage is knowing that the investors providing that capital have enough confidence to give millions of dollars upfront to expedite a company's potential. In this case, they have provided plenty to encourage EVKRF's ambition of unearthing lithium and nickel assets to serve massive demand from the EV and clean energy sectors.
Specifically, private investor interest has led to EVKRF having over CAD$9.8 million in cash and marketable securities on its balance sheet. That total does more than fundamentally put EVKRF in an excellent place; it puts into play the proposition that EVKRF stock is appreciably undervalued. And that apparent disconnect isn't going unnoticed. In fact, despite its recent pullback, investors have pushed EVKRF shares over 102% higher since June. (* share price on 10/02/23 market close, $0.075, Yahoo! Finance)
And that trend is likely to steepen, especially with EVKRF having more than the capital to accelerate exploration; its 100% owned interests in Nevada and British Columbia assets keep them on track to unearth lithium and nickel at properties that have historically given up significant reserves.
Exploiting Opportunities In Historically Rich Locations
If EVKRF can exploit that precedent, current values may be a springboard to substantially higher prices. That's not overzealous speculation. Remember, sitting atop proven reserves can accrue to the balance sheet. Better still, they can attract partnerships from EV and clean energy sector participants who understand that the assets Grid Battery intends to uncover are vital to their own business ambitions. Those following headlines know that Tesla (NASDAQ: TSLA) CEO Elon Musk hinted at his company creating its own mining program to support its critical lithium needs. But that strategy has a problem- getting the proper permits to explore can take decades. And from there, it can take years to bring lithium and other battery metals above ground.
Thus, the better and more efficient strategy would be to partner with a company already permitted and showing potential to tap into vast reserves. Grid Battery Metals checks those boxes. And interest can come from many besides Tesla. General Motors (NYSE: GM), Ford (NYSE: F), Stellantis (NYSE: STLA), and Rivian Automotive (NASDAQ: RIVN) are other names sharing an interest in sourcing every bit of lithium and nickel they can find to power their battery-powered vehicles. And while demand is skyrocketing in 2023, it's expected to increase from here, with estimates suggesting that over 60% of cars will be battery-powered by 2030.
That puts EVKRF in the sweet spot of opportunity. And in this instance, share price size doesn't matter. Having the right assets to explore does. Grid Battery Metals checks that box. It gets better. In addition to having impressive property interests, they are in some of the world's most mining-friendly jurisdictions. That positions them ideally to capitalize on and maximize its revenue-generating opportunities through a go-it-alone or partnership strategy. And remember that the EV sector is just one contributor to EVKRF's mission to grow bigger faster. Battery producers also need mountains of these critical metals to support their business, which opens billions more in potential dollars earned.
Grid Battery Has An Impressive Asset Portfolio
Earning from that potential is certainly in play, noting that in addition to exploring promising sites, EVKRF has done an excellent job of aligning itself with the battery metals sector's vision and mission to reduce carbon footprints and excavate in an environmentally friendly way. Grid Battery is more than supportive of those measures; it can achieve them using a low-overhead exploration strategy that replaces outdated and environmentally destructive exploration and development models.
That matters. In fact, embracing those values can be the difference between getting permits and clients or not. Grid Battery has created its plan to ensure scoring both. That's timely. After all, it's undeniable that global consumer trends and initiatives support eliminating fossil and carbon fuels as a primary power source. The auto manufacturers are the front line and are doing their part to produce more EVs for sale on a consecutive yearly basis. That production number continues to grow, compounding from the number of car and truck models designed, built, offered, and sold. And that already compounding rate is rising as governments offer EV subsidies for consumers and manufacturers, shifting an already fast pace of adoption into warp speed. Tesla alone is on a mission to produce and sell twenty million EVs annually by 2030. But know this: those vehicles are just shiny showroom models without batteries. And Tesla is only one manufacturer. The Big Three automakers and niche sellers expect to sell millions as well.
Of course, that's excellent news for a company like Grid Battery Metals, which can equate EV sector growth with the number of batteries needed to power the products. In that respect, even the most bearish expectations for EV market penetration require upwards of 10X current battery production. It's a tall order indeed. However, to help meet that need, Canada and the US, among others, have committed to supporting the mining industry, evidenced by legislation providing financial and functional support to the mining industry as part of a more significant intention of transforming a current carbon-burning products environment into clean power technology.
Advancing Prospective Properties In Mining-Friendly Jurisdictions
Grid Battery intends to contribute to that transformation. And they can achieve that goal through an impressive and promising asset portfolio that continues to strengthen. In 2023, the company added two highly prospective lithium properties to its Nevada portfolio, the Texas Springs Property, and the Volt Canyon Property, increasing its Nevada prospects that already included its Clayton Valley Lithium assets. Management noted that its team is exploring the Texas Springs Property, with planned summer/fall 2023 exploration underway. It comprises a CSAMT geophysical survey and a detailed soil sampling of 50 m X 100 m spacing. The CSAMT survey is used to gather information about subsurface resistivity and geology, which can help predict geological structures and locations for lithium. Results from the two exploration programs will help define and design its 2024 exploration plan, including identifying possible drilling locations for clay-based lithium targets.
Expectations are optimistic. The company noted that its Texas Springs Property adjoins the southern border of Surge Battery Metals' (TSXV: NILI, OTC: NILIF) Nevada North Lithium Project, which, in its first round of drilling, identified strongly mineralized lithium-bearing clays. Further supporting EVKRF optimism, Surge Battery recently announced the results of its most recent drilling program at this property, saying it recorded its highest grades to date, with up to 8070 ppm Lithium on the Northern Nevada Lithium project.
Grid Battery is equally bullish about its Clayton Valley Lithium Project. There, they intend to follow the recommendations of its NI #43-101 Technical Report to continue a multi-phased exploration program. The initial phase includes building the geologic infrastructure through data compilation and initial auger sampling to collect lake-bed material below the sand dunes and alluvial cover. The second phase will help determine the sub-surface structure and topography to identify drill targets following a geophysical survey using gravity, seismic, or magnetotelluric techniques. Phase three would be to drill the best targets identified in the first two phases, including drilling, assaying, permits, and reporting.
A Busy Q4/2023 And 2024 Planned Agenda
Combining the sum of its asset parts with an ambitious exploration mission, EVKRF could be in its best-ever position to rally back toward its 52-week high of $0.17, 126% higher than its current $0.075. That bullish assessment is supported by tangibles as well as inherent potentials, including value from its 100% interest in the Texas Spring Property, its 100% interest in 113 lithium lode and placer claims covering over 640 hectares in Clayton Valley, and its 100% interest in 80 placer claims covering approximately 635 hectares of alluvial sediments and clays located 122 km northeast of Tonopah, Nevada, at its Volt Canyon Lithium project.
They have additional value drivers inherent to their British Columbia nickel projects. Its Mount Sidney Williams Group consists of three claim blocks with a total area of 10,569 hectares. Notably, those are nearby and, in some instances, adjoin the Decar project of FPX Nickel Corp. (OTC Other: FPOCF). Its Mitchell Range Group area claim consists of one claim block covering 8,659 hectares with demonstrated metallic mineralization, including nickel, cobalt, and chromium.
Hence, plenty supports the bullish thesis. In particular, Grid Battery Metals has impressive assets, experienced management, and evidence indicating they are on the right path to unearth significant lithium and nickel deposits. Additionally, they are fully funded to complete exploration through 2024, which, from an investor's perspective, could mitigate downside risk related to dilution. Yes, mining stocks are risky. But the returns can be enormous through the right company at the right time.
Grid Battery Metals presents that proposition not through hype but by assets owned, pace of exploration, a balance sheet that can fund operations, and, as importantly, getting nearer to the potential of delivering critical battery metals to massive global demand.
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