. . .The next step is to build a pilot plant. Right away, people ask how Ucore will get the money and whether it will have to dilute the shares. Well, we know that a large source of funding will come from the Defense Logistics Agency (DLA). There's also strong support from the state of Alaska, which has a 'permanent fund' based on decades of oil revenues. Then there are the ultimate downstream customers who will benefit from these materials. These customers may also raise funds for the plant. Chief Executive Officer Jim McKenzie has said that the last thing he wants to do at this stage is dilute the shareholders by issuing more shares willy-nilly."
GH: It's a good sign. It is encouraging to see an acknowledgment from the DOD that it needs to engage with the defense supply chain more than it has to date. It also is doing an yttrium-related project with Great Western Minerals Group Ltd. and a related magnet project with a U.S. magnet company called Thomas & Skinner.
It's a good thing. . .Ucore blazed the trail somewhat with its interaction with IntelliMet LLC and its president, Dr. Richard Hammen, who is an accomplished scientist and the inventor of the SPE process technology as applied to REEs and other minerals. I was there in Niagara Falls in October of this year when Dr. Hammen presented the initial work on the Bokan Mountain materials at the COM (Conference of Metallurgists) 2012 meeting. I've had some discussion with folks involved in the project. There is something there. The question will be, as with any new process—can it be scaled? What are its limitations? What are the economics? What might it be best used for versus other technologies? It's the early days, but I'd say that it is definitely worth looking at. There's growing interest.
. . .Bokan Mountain has an Inferred resource of about 5.3 Mt of 0.65% TREO, of which 40% is enriched by HREEs. This is a modest initial resource estimate. The project is open to expansion, and it has excellent potential for value enhancement with the new Solid Phase Extraction process. The positive results of the study have led the company to delay completion of the PEA, but it has good potential for accelerating in improving the confidence in the bankable feasibility study. Upon completion of the PEA, Ucore will also be able to actively pursue off-take partners. From our vantage point, we see its partnership with the Department of Defense as providing substantial long-term support, mitigating political risk."