Electric Royalties (ELEC) - Positive Cashflow 2023 with Battery Metals

Interview with Brendan Yurik, CEO of Electric Royalties Ltd. (TSX-V:ELEC)

Recording date: 23rd November 2022

Electric Royalties Ltd. is a mining royalty company that aims to take advantage of the worldwide transition to clean energy by buying royalties on the mines which supply clean energy commodities. Energy commodities include metals such as lithium, vanadium, manganese, tin, graphite, cobalt, nickel and copper, which saw increases of up to 400% depending on the commodity in 2022.

The company announced on the 15th of November 2022, that it had entered into an agreement with Strategic Minerals Europe Corp. to acquire a 0.75% gross revenue royalty (GRR) on the producing Penouta tin-tantalum mine, located in Spain. The GRR is to be acquired for a cash payment of CAD$ 1 million and the issuing of 500,000 common shares of Electric Royalties Ltd. The agreement will also enable Electric Royalties Ltd. to acquire an additional 0.75% GRR within the first 7 months after closing of the agreement for a cash payment of CAD$ 1.25 million. The gross revenue royalty is to reduce to 0.5% upon the completion of certain minimum payment requirements to Electric Royalties Ltd.

The company also published an update to its royalty portfolio in October 2022, with highlights including the Cancet lithium project, on which the company holds a 1.0% NSR underway with advancing towards permitting through the completion of various environmental studies. The projects on which the company hold a royalty, are advancing towards production, permitting or feasibility studies.

The 0.5% gross metal royalty Electric Royalties Ltd. holds on the Authier Lithium project, is set to place the company in a cashflow positive position in 2023. The project will be the only operating lithium mine in Canada and is set to commence production in Q1 2023.

0:00 - Company overview
1:09 - Thoughts on the general public’s understanding of battery metals royalty
2:45 - Expected time of getting recognition from the market
4:30 - Reason for the lack of attention toward battery metals royalty
5:17 - Explaining the thesis of the company to the potential investors
6:42 - Making the company defensible
7:33 - Options of the company for getting capital
8:36 - Reason for doing a battery metals royalty
9:20 - Getting the money to deploy capital for the deals
13:08 - Properly issuing guidance and valuing royalty companies
16:46 - Overview of the company's general plan
18:12 - Seizing the opportunity in the royalty space
21:56 - Outro

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[justpete]

If Brandon comes back on I’d like to get his take on Nyrstar and any potential shuttering of their smelters spreading to North America and how that would affect deal flow in 2023.

[frankfarley]

CEO can’t stop laughing and interrupting the host. Must be a hell of an investment.