David Wargo: The First Inning of a Rare Earth Revival
Summary
Market Outlook: The podcast discusses a shift back to a more industrial economy, reminiscent of post-World War II, driven by the increasing demand for rare earth elements and critical minerals.
Investment Opportunities: The conversation highlights the potential in rare earths, particularly in ionic clays and monazite deposits, with companies like Meteoric and Energy Fuels positioned as key players.
Geopolitical Dynamics: The podcast emphasizes China's dominance in the rare earth market and the strategic moves by Western nations, including the U.S., to secure their own supply chains and reduce dependency.
Company Insights: Energy Fuels is noted for its unique position in both uranium and rare earths, while Meteoric is highlighted for its world-class ionic clay deposit in Brazil.
Government Involvement: The U.S. government's role in supporting domestic rare earth production, including price guarantees for companies like MP Materials, is discussed as a critical factor in the market.
Long-term Perspective: Investors are advised to adopt a long-term view on rare earth investments, considering the sector's volatility and the strategic importance of these materials in the new economy.
Industry Challenges: The complexities of rare earth extraction and processing, including environmental and regulatory hurdles, are acknowledged as significant challenges for the industry.
Future Outlook: The podcast suggests that the rare earth sector is in the early stages of a long-term growth trajectory, driven by technological advancements and geopolitical factors.
Transcript
We're going to take our industrial base back close to post World War II. So, you're going to make boats. You're going to sit fix boats. Like, you're going to we're getting back to the basics, which is if Rarus was the was the catalyst to get us going in the right direction and stop being a service economy. It's great. So, it's it's tough now, but I think long term it's going to be great for the whole continent. Demand for these materials is, you know, it's not going away. It's just going to continue to be demand pull driven. We're in the like first inning of a nine inning game. It's probably going to go to a few extra innings, right? So, so it'll be fun. >> Don't forget to sign up for a free portfolio review with one of our endorsed investment partners at wealthon.com/free. With markets hitting all-time highs, now is a great time to stress test your strategy and be prepared for what comes next. >> Greetings and welcome to our wealthy show. My name is Trey Reich and I'm here today with Dave Vargo, head of investment banking at our partners in Toronto, SCP Resource Finance. Uh we're very excited about our silver conference which is going to kick off tonight with a welcome dinner and then tomorrow uh with a full day slate started with Eric Sprat etc. and I think the cream of the crop of the silver industry pan-American first majestic uh another 12 producers and Maria Smnova from Sprat um Connor O'Brien. So, it's a an action-packed uh slate. And if folks aren't going to be here in person tomorrow, please sign up for the virtual option for this Saturday uh beginning at 8 and ending at 7, which I will be MCing. Uh so, Dave, thanks for coming. The topic today, of course, is not silver. Uh we thought uh given developments in the area of late we'd revisit the air uh area of Rarers. >> Yeah. >> So um >> lots going on there. >> Yep. And uh I don't want to do too much geological history for everybody, but >> could you just give us a brief overview when people read in the paper rarers and now it's even expanded to critical minerals. Um >> you know there's 17 rarers. I'm sure there's another 20 >> critical minerals >> and they get lumped together. Are there a few that are much more important than the others that this whole game is really about? >> Yeah, there's two um and those are the ones that are mainly situated in uh Southeast Asia. uh and they're the only two elements that um you know more or less balance the trade negotiations and that's disposium and turbium and they're referred to as the heavy rares um and they're the they are all over the world but in economic quantities you really find them in that old Southeast Asian corridor from uh southern China Lao and Vietnam and I'm sure they have some in Thailand as well and it's just very weathered Uh it's ionic uh beautiful metallurgical properties. Uh truly the champagne of uh heavy rarers and the Chinese have a a lock on it and uh yeah so that's where you find them. Um and but you know there you can find them other places. A lot of them you can find them in um uh other ionic clay deposits around the world. And you can get a lot of D and TV out of monzite, which is the radioactive um or high radio high uranium thorium ores that you would find on heavy mineral sands uh cuts. And that's what um Mark Charmer charmers at EFR is uh perfecting right now. So he's gone that route, but it's uh mainly in Southeast Asia is the where you find the two most important rares. >> I was going to ask that question. So since you mentioned it, >> can you talk a little bit about the difference between ionic clays and monazite? >> Well, ionic clay um it's mother nature's done all the work. Uh it's fully oxidized for the most part. it should be. Uh, and so the rare earth is loosely associated with the clays. Um, you don't need to drill, you don't need to blast, you don't need to crush, you just free dig and you're washing the clay with ammonium sulfate, pH of four or magnesium sulfate, pH of four, which is almost benign. Um, and you're basically getting 70% of your payability within the first five minutes. That's the true rare earth deposit. Uh and then a monzite deposit uh comes in hard rock and as well as um heavy mineral sands. And um monzite is loaded with uranium and thorium. So it's deemed a class 7. Uh when you ship it, it's class 7, which means it's very highly regulated because of the radionucleides. uh Aluca in Australia can separate them and uh they're they're they're ramping up uh and EFR in Blanding, Utah, which has just knocked it out of the park. Like I can't stress how much how well Mark Chalmer's has done at that company. And you look at the share price. Uh he's doing it down in Blanding, Utah. And then of course the Chinese can do it. Uh and the Russians can do it, but you know for the Western world it's Australia and it's EFR and it's class 7 shipment. So they're the only two that right now can handle the radionucleides and maybe uh probably um it's now salvi salv which is the old rome plonc which is the old rodia and one of the pioneers uh French company um they they would also be able to do this at larelle but you know it's a bit different when you're doing it you know in a beautiful place on the Atlantic Ocean right so uh the main two places are um that can solve that issue are landing in Aluk and Australia, but they're highly radioactive, but with that you get a beautiful mix of heavy and light rares. It's very unique and you can get high grades of like disposium and turbium and and whatnot. So, and I think Mark is putting a he's going to put a heavy mineral, it's fully licensed, he's going to put a heavy mineral sands deposit into production in Australia, and he's going to get a I don't know what the amount of DY, but it's a DY is one of the primary uh minerals that's going to come off of that. of of that production. So it's it's it's starting. So it's good. >> So one of the things that we hear all the time is that there are these types of uh ionic clays and manazite >> elsewhere in the world, but they're not large enough >> to mine profitably. And then we also hear how easy it is. You basically just wash the stuff out. >> So this is just a personal question. And I've always wondered if if you find a little bit of this stuff, it seems to be so easy to process that the barriers to entry would be low, but they're high. >> Well, yeah. You know, you can strip a rare earth out of a clay hosted deposit. Then you have to take that then you you strip it out in ammonium sulfate, right? So the rare earth attaches to the sulfate and then you will precipitate precipitate that out with with a hydroxide or carbonate. So you got a something called you'll hear in the industry mre. >> So mineral min well just your your mixed rare earth uh carbonate. Let's just call it that. You get a mixed rare earth carbonate. And then you have to take that >> and it's about 50% uh rare earth concentrate. Now and then you have to do solvent extraction and and and and uh separate out each individual um rare earth. And you think about it, the closer any two elements are on a periodic table, the harder it is to separate because there's, you know, they're very similar. So, uh, there's a lot of horsepower that goes into the downstream processing of the stuff. And that's where the West, uh, will catch up. You know, we we invented it over here. Um, the Chinese perfected it over there and they've just run away with it. So um that's where the um that's where the value ad is on the uh first part of the downstream. And then you'll take those molecules you alloy them and then you'll make magnetic materials out of them. Right? So it's pretty uh pretty pretty complex idiosyncratic process. It's not for everybody. My other uh question, since they're these 17 that everybody focuses on or that the press focuses on, the lighter rarers, if you have a lot of them, what do you do with them? It's just it just depresses. >> Well, I mean, the thing is like, you know, in a light rare earth deposit, 75% of your payability rule of thumb, uh, would be serium and lanthnum. And if you're running your process off of 20% of the overall concentration, you know, whatever that ratio is like 3, you know, whatever to one. So you're getting one, you're producing three no matter what. So there's only so many applications for serium. There's only so many applications for lanthinum. And there's always an over supply because you're running your whole process on the lights for ND and PR and on the heavies for DYTB. Um so everything else that comes along with those uh you're just going to you're going to create a lot of extra molecules and and the markets are not big enough to absorb those molecules. So the price is it's not even worth talking about. Right. >> Interesting. >> You're literally the whole rare space is based on the magnets really for the most part. And um there's lots of applications for serum and lanthinum but not enough to take up the the extra molecules that are being produced as NDPR. I think it's growing at a compounded annual rate of like 14%, right? So you're not going to you know you're not going to increase demand for serum and LAN at the same pace. So they're not worth anything in my in my books, right? But everybody puts an economic value on it and then they'll put it in their presentation. and look this up my deposit's worth and >> you have to discount it to zero basically is my my that's my rule of thumb anyway. >> Now even though rarers have been on the front page for the past year or two >> prices haven't sort of reflected that urgency have they? Well, no, because every time the west starts to bang the drum on rar and increasing production uh and you know start developing projects, the Chinese just open the faucet and they flood the market. And so a perfect example, I think I said this last time around, but the perfect example of that would be like, you know, um EFR went into the market, they were buying monzite for 500 bucks. They started cracking it, separating, producing um uh magnet grade NDPR and the next time they went into the market, the price of the concentrate was 20 times higher and it didn't make economic sense for them to separate it because the Chinese basically said we'll pay you $10,000 a ton and you know, money talks. Always tie goes to the money. So, uh, that was bent towards the east and Mark just kind of, you know, went out on a buying spree to get primary deposits for his own feed, right? And he's done a hell of a job doing that. So, >> this October, Wealthian's putting the spotlight on silver with expert interviews, deep analysis, and a special in-depth report from our partners at SCP Resource Finance. To receive this report and other exclusive benefits, you can sign up to become an accredited investor with Wealthon at wealth.com/acredited or by finding the link in the description below. Speaking of silver, Wealthon will be on the ground in Toronto for the SCP Resource Finance Second Global Silver Conference happening on Thursday, October 23rd. Legendary investor Eric Sprat headlines the event alongside 15 silver mining companies presenting their top projects. It's a mustattend for anyone serious about investing in silver. Tickets both in person and virtual are now available. Find out more in the description below. >> For viewers, I think it's important to recognize that this is a very no absolutely complicated. It is very complicated and the Chinese have developed their industry uh really I want to say for 40 years right like in Ernst they took over the industry 9798 and put Mountain Pass which is the uh deposit that the Pentagon just took a stake in to um they put that out of out of business and then they then they focused on the industry as a whole to become the rare earth leader and um they've monopolized the global market and they really have monopolized the downstream and what's amazing is we've brought the technology into the country in 2003 four five around there. So uh and they've just taken that technology and run with it. So, so 20 years they own they own the they own the house. >> Moving to uh the front pages recently. >> Y >> uh as I recall the uh sequence of the past year back in April, China put some controls on rare earth exports and it's all as a you know preamble to trade negotiations and then y >> we I what did we do? We extended the >> truce for 90 days. we did something that >> um caused them to open things up and I thought it was sort of solved >> and then yeah >> two weeks ago what happened? >> Well um the way the the trade agreement they they settled the trade agreement because I think the the US realized that they were really in a bind. You had like Ford shutting down production lines because you can't make electric cars without these u these rare magnets. And so they, you know, they obviously settled a um an extension of a of a trade agreement. It wasn't settled completely, but they got on the same page. And that allowed for the rare magnets to be starting to reexport out of China into the West. And then what the Chinese state has done is they've they've they're giving uh export licenses, but you can only sell to certain industries. So the car industry, I think, is okay. Although, you know, it's never as you know, as advertised. Like if they were if you're allowed to export one magnet, you you know, you actually had a license to, they're only exporting like half a magnet, right? So, they're not really sticking up to their end of the bargain. And that's to squeeze the Americans because they obviously want the tech like AI tech and those Nvidia chips and other things. So, they're going to use this as as real leverage. And so two weeks ago um there was a a rumor that the um they were just going to cut off rare supply to like basically the west as a whole and the whole kind of western world woke up and was you know dead set against it. I think the Chinese state kind of overplayed its hand because it's uh you know truly has a monopoly here. And then you know as a function of that and this was always in process but in as a function of that you saw Trump in uh in Australia doing the big agreement with uh not in Australia but he did the big agreement with the Australians uh on critical minerals and rarers because they've got a lot of critical minerals and rarers. You got Algo Alcoa is going in for the I think Gallion um in Australia they're going to get subsidies from the US government uh to get all this stuff going. Uh, so I think you've seen and I've seen in my own work that like it's really ramped up um the interest in the space and it's also ramped up a lot of the stuff we've been working on. It you can tell that um it's um it's become way more um oh what's the word I'm talking uh looking for? It's like when it becomes more um urgent the urg the sense of urgency is has gone through the roof, right? So, um, it's truly game on. Uh, DYTB were the only two that balanced the trade negotiations on the last settlement, and it looks like they've got a lot of leverage here. So, they're going to leverage that position to get something out of the out of the Americans is my guess, right? And I I don't think that they're going to cut us off. They may have certain industries that you can't sell to, like the Americans, you know, and or sorry, not just the American, the West have things they can't sell to the certain Chinese companies. And so it's it's going to be a it's going to be a tit fortat thing for a little while. And so I think it's something we have to get used to until till the um Americans and uh the West as a whole because the Europeans are are pushing forward too become basic in our own supply chain and rare earths and that's going to take billions of dollars of capital investment. It's going to take years of training young people to be able to do the jobs and um but we'll get there. And uh I it's almost get the feeling it's almost like um it's like a war measures act, you know, like it's like this is this is to the point where it's it's elevated to the highest people of government like Trump talks about it. So, um, it's it's game time and it's it's about time, too, because, you know, not saying we're ahead of the curve at SCP, but like we were ahead of the curve and we were, you know, we we've been going down to the States for a long time now saying this problem's going to be here. And and sure enough, it shows up. And so, I've I've had the the luxury of seeing the process, you know, and I can tell you it's uh it's certainly game on now. And it's the best thing that could ever happen to the west because it's not just rare earths like you know you talk about all the other critical minerals it's there's lots of other critical minerals that we you know like tungsten uh graphite they the Chinese control those germanmanium gallium they control those and so um every critical mineral that's on that list is something that's very important to the US government like antimony that's why the deposit out in Idaho which is run by perpetua which was the old Midas uh got IRA IRA money because they had a not only is it a beautiful gold deposit, they have this great side stream of um antimony, right? So that's another critical middle. So anything that the Chinese have basically wrapped their arms around and they did it with purpose that, you know, they don't wake up and just decide to do something on the day. It's a state planned economy, right? So this is by design. So that critical mineral list that you know changes uh all the time uh those it's it's all all the minerals that the that the basically the Chinese state more or less monopolizes right so it's good for our business I can tell you that and it's going to be fun to see you know um the US re-industrialize right because it's going to be great for Canada it's great for the US it'll be great for Mexico the whole North American continent's going to boom because uh of what's happening in the states and uh you know will they go back to a postWorld War II industrial base? Uh not 100%. But I can tell you this, the people I've spoken to uh you know they they told me get that office in New York open very soon Dave because we're going to take our industrial base back to close to post World War II. So you're going to make boats, you're gonna fix boats, like you're gonna we're getting back to the basics, which is if Rarus was the was the catalyst to get us going in the right direction and stop being a service economy, it's great. So it's it's tough now, but I think long term it's going to be great for the whole continent. So >> I just want to emphasize that uh to our viewers that throughout this whole trade uh fight with China that's been accelerating for two or three years, this is really the first time that we've seen uh Western nations uh >> show a combined resolve this quickly. You think >> 100%. 100%. Like it's it was it was unanimous, right? You it was bipartisan. It was just like no >> within a week. >> Yes. Mhm. >> Because you think about it like BMW, Volkswagen, all everybody, you know, and we are allies, you know, I think on the surface we bicker, but behind the scenes it's like, you know, there there is a there is a there is an organized medium that's, you know, that that's really tightly bound together, which is which is important, especially when you're dealing with a state controlled economy as your competitor because that's makes it very difficult for the entrepreneur and the individual right so you have to have state backing um and you know Pentagon taking 15% explicitly as you know it's not too often that the US government is explicit about what they're investing in and I think that this time around they're explicit because they want the world to know that it's it's different this time and it is different this time which is good so they're explicit about their intention and it's it's to signal to the rest of the world like it's like you know what we're we're we're getting back to work and look out right I love it it's awesome so >> now importantly introducing the government to this whole thing obviously is going to introduce a level of inefficiency so over the last couple of weeks as I listen to the morning call uh and some of these random investments or letters of interest and that type of thing tape >> you and Justin and Brandon and the team >> have your own opinions about all these minds already formed and some of them you're not too confident, you know, may be that profitable. So, doesn't this sort of mess the whole thing up too with all this government or is it just rising tide? >> Well, it's a rising tide. Plus, the the the the State Department or the Pentagon, they've guaranteed prices for for Molly for not M Well, it was Molly Corp, it's now MP Materials, whatever. >> Call it Molly Corp, its real name. And uh they they've they've uh guaranteed them $110. I think it's a kilogram for every uh pound every kilogram of NDPR they produce. Um and so that you know like you know in mining you know there's minerals everywhere. It just comes down to economic quantities and economic quantities as a function of price right. So, as the price goes up, you know, you know, if gold goes to $50,000 an ounce, you'll probably see people filtering Lake Ontario, right? Because you could probably make a penny off of it. So, as the price rises, you're going to get what was a non-economic deposit, uh, you know, getting financed and, you know, so you what what's going to happen is you're going to have a a flood of capital. It's already happening. A flood of capital come into the space. Um the good ones will get financed and uh and the bad ones will get financed and the marginal ones will get financed because all boat boats float in a rising tide whatever the expression is. >> And when um you get enough capacity into the system, enough molecules coming into the into the uh into the world again uh the price will come down um and then the marginal ones will go out of business, right? But I think that um in this case um I think >> did the government pick the right company with MP? >> Well, I mean it's the historic rare deposit. Um and you know I mean I would have chosen another one, but I you know I I'm I'm I I also understand why they did it because California you know it's in California and it's it's America for Americans and you know I don't have a problem with that. Uh and and it's still a good deposit, right? But you're getting lower into it, so you're going to get higher radionucleides, which means, you know, you're going to have a problem with uranium and thorium eventually, if they don't already. I think they do. I'm not sure, so don't quote me on that. But um there's lots of other deposits in the world um that would complement uh Mountain Pass in a in a in a significant way. Um, so look, it's it's it's not the first one I would have chosen, but I'm I'm not in the room and there's lots of other reasons behind why they do things and it's just not money. Um, what I think the most important thing that came out of that, it's like we're serious about this finally, right? And this space has just been decimated and the Chinese have just controlled it and it's going to it's going to take government support across the western world and it's going to take subsidies, right? It's like I don't know I look at it as this the new it's the New Deal 2.0, right? Um so it'll way I see the next decade going is there's going to be a tremendous amount of government subsidies across the West. uh quasi I don't want to use the word nationalization but when the government comes in it's kind of quasi nationalization and then I think once it gets off its back and once you know uh the systems running again at a good clip then you know the I guarantee the Americans will the American government will sell down its stake and it'll become you know a public company in in the capital markets on the New York Stock Exchange right so uh no problem with what they're doing and because it has to be We let everything go, right? And we became banquet waiters and look at my sleeve tattoo. It's so it's time to put a wrench in our hand and get back to work. >> Yield curve. A yield curve country. >> Yeah. >> So, um, on the MP deal, normally when the government picks a company like that to back, there would be losers. But is it fair to say that the MP deal really put a floor under everybody? >> Yeah. I mean, if the government's going to guarantee you 110 bucks, >> um, that becomes the floor price cuz, you know, even if I'm the Chinese, I'd be like, perfect. You're going to charge 110. I'll charge 110, too. Right? So, because they're going to come into the market anyway, so take extra rent. So, uh, that's that's basically the floor price for the industry, right? So, um, and that that'll stimulate lots of lots of investment, right? If you're looking for a simple, secure way to invest and own physical gold and silver, visit our sister company, hardassetsalliance at hardassetsalliance.com. That's hardassallalliance.com. Do >> you have an opinion on 110 as a price or does it not really matter? It's just they pick one and that's it. Yeah, 110 110 would be the price where it just tells me that their cash cost is $55 because rule of thumb in the mining space is your C1 cash cost times it by two typically gives you a 15% internal rate of return. And I think that that's that's the there's not a lot of magic behind it. I think that's the magic. H >> so yeah. >> So I think another thing for viewers who are looking at the space, we've already talked about the fact that even though there's a lot of pressure on supply, prices don't always cooperate. Another variable that I would like to get your perspective on if you're going to invest in sort of the rarer space, what would you say would be an appropriate time horizon? In other words, these aren't things you want to trade. Correct. No, don't trade them because the price is going to go up and down. >> Uhhuh. >> Um I think you just I think the way I would invest in the space is have a long-term perspective because the space, you know, is volatile. Um and you will hit the asmtote of pain, believe me. >> Um every space does all these things around trip, right? So, uh, I would look at long life assets that have great metallurgy. And so, on the ionic clays, they're the best in the world. That's the Champagne of Rare Earth. Um, and there's a company in uh that we've championed at SCP. Great management team, great board, great everything. Uh, they've got a they've got a beautiful ionic clay deposit in Brazil. The companyy's called Meteoric. I'm not making a recommendation to buy it, but if you want to understand what a tier one ionic clay rare earth deposit looks like, look no further than Meteoric, and that's MEI on the ASX. And um they're going to be at final investment decision uh by I think by the end of Q1 next year, so five months from now. And we've been championing this story for three years now. And the uh you know, the guys who got their hands on this project did a great job. And um we've you know helped build the company and uh and it's it's it's tier one. It's it's I think it's the best clay deposit in the world. I think it's better than anything in China too. So on the light side, sorry. >> Has Meteor always been in rares or were they mining something else? >> No, I mean it was it started out as a gold company. Typical mining. They started a gold company and then you know the the the person who ran the gold company you know befriended the vendor of the rare asset. I think his nephew or something like that helped train him as a geologist and you know built up a lot of goodwill over time. He got a phone call, what do I do with this? And then I met him about 6 weeks after and I I know what you're going to do with this. Like it's game on man. It's like >> it truly is a it's it's a worldass deposit. It would be it's like the Sbury basin is to nickel. It's like you know um Freedelland's Ivanho to copper in the Congo. It's that's it's that type of deposit, >> right? >> But for for viewers that look it up, they I didn't want them to be confused as I did that it shows up as a gold company, but it's not. >> No, it shouldn't show up as a gold company. You go on the their web page, it'll come up as a rare earth company. Okay. >> So now it's 100% rare earth. >> Oh, it's been 100% rare earths for three years. Yeah. Yeah. >> Yeah. They sold off the gold property for like 25 million bucks. And um Yeah. No, it's it's top of class. It really is. They've got um they've got a very competent board. Stuart Gail's the CEO. He's more than capable. He's very good. He's doing an excellent job. And they've got the goodies, right? They really have the goodies. And if you got the goodies, at some point the market will wake up to it. The sun will shine on you and your market cap will quadruple. It's I think it's worth like5 to$10 billion as it sits today. It's >> 1.5 billion tons. >> Yeah. Talk about the deposit. What's there? >> Well, they've got it's the average resource grade of the deposit's like 2,700 ppm. Um, which is high grade for ionic. Uh, when I met with the company, um, they had about 400 million tons and since then they've extrapolated that into one and a half billion tons at 2,700 ppm. And most importantly, it's laterally uh ionic and uh vertically down as you go down the horizon of weathering. It's it's ionic, you know, they haven't really hit the threshold of where it's not. It'll probably be ionic as you get stopped being ionic as you get close to the bedrock, right? Because it makes sense. It's not weathered. But you're looking at probably deposit, if you really think about it, probably goes to two to three billion tons. And you'll be mining that for two to three to four 500 years. Like it's your kids kids will be mining it. And um I think the demand for this stuff is going to go through the roof because all the magnets in these data centers that will drive the electric motors, all the electric motors in these in the electric cars, all the electric motors in the in the robots that everybody's talking about now, right? It's all neodymium iron boron magnets. That's so this market's just going to boom. And that's why I think even if all these other rare earth deposits, even that they're marginal at today's price, I think the demand pull, it's going to be so elastic. If you can give somebody a molecule and they know that I can actually spec this into my into my uh consumer product and not worry about having to change suppliers, not worrying about not being able to get the molecule, it's like the Chinese just don't own it. uh you'll see a very elastic uh response and I think you're going to see applications proliferate as we you know as we electrify the economy and and that's not going to change because the genies out of the bottle and um the Chinese aren't stopping so that means we can't stop right so I think it's going to be a great space to be in for the next you know 10 20 years >> and going back to MP you were talking about the drilling uh how is drilling drilling in clays different from drilling, you know, hard rock for gold. Is it cheaper to drill same amount of? >> Yeah, like a clay clay, you get an augur drill, which is just, you know, you're pulling the earth up and taking one meter, put it one meter samples in a bucket >> and you can do that with your hands, right? um a bassinosite deposit like mountain pass which we'll use as a comparison that is hard rock bassinosite no uranium and thorium in the weathered part but you got to drill it out through hard rock you got to drill it blast it crush it float it leech it precipitate it and then put it through a solvent extraction line um so your working capital there would be a lot longer and then a uh a a ionic clay deposit you dig up you wash you precipitate then you put it into your into your SX line. So your working capital is smaller. So you're used to now that we have real interest rates that you know that shortening your working capital or your work in process is very important. It's money. >> So it's just everything about a clay deposit is just it's 10 times better. It's like finding oil in Saudi Arabia. It just flows to the surface, right? That's that's what I would that's what I'd compare ionic clay deposit to. uh >> capital intensities >> capital intens sorry to interrupt our ionic clay deposits >> at depth near the surface all over the >> Oh, near the surface. It's weathered from the surface, right? >> Yeah. So, it's just a weathered like like you know it could have been an old monazite deposit. It could have been an old basinite deposit and it's just weathered, right? And so if you think where you got these these these um ionic clay deposits like lots of water, lots of heat. So all of Southeast Asia, I don't know if you've been there before in the summer, it is hot as hell. >> Uh and that those are the those are the things that drive oxidation, uh water, oxygen, and heat. And when you go to So that that's where you're finding all these ionic clays. So, and then you fast you go across the ocean and around the well, yeah, across the Pacific. And you hit Brazil and you're in the the Amazon basin. It's, you know, hot as hell in the summertime there with a tremendous amount of water and a tremendous amount of rainfall. And those are the perfect conditions to oxidize the deposit over a very long time, like millions of years. But that's what you get. you get this unconsolidated mother nature processed deposit and you don't have it's the capital is 40 cents on the dollar to a conventional like if mountain pass they just discovered it uh an equal amount of rare earth rare earth like meteoric we'll use an example so Meteor if they were to build the same amount of rare earth capacity as mountain pass okay uh the capital intensity would be 40 cents on the dollar Like that's real savings, right? And the world's broke. So, >> uh I know where I would be looking. >> It's a pretty it's it's just a no-brainer. >> And remind me where is the meteoric deposit? >> Uh it's in uh in in Brazil. You you fly into Sa Paulo. >> You drive I think northeast for three hours and it's in the it's in a caldera. I I should know the state. It slips my mind now. I've been there a few times. >> But it's in an old volcano, right? So it's contained. There's one stream out of the volcano. And so you've had the perfect containment of the mineralization to just be weathered over millions of years, right? >> And this thing's big. It's like 35 km by 30 km. >> Like it's massive. >> Yeah. Yeah. A number of times. And it's it'd be like um it'd be like having a deposit in Sbury, getting on the 401, then hitting the 400, then you know, like it's just even better than being in Sbury cuz Subbury goes down to like, you know, two-way highways. This is a three-way highway all the way. >> Then you turn turn left, you got a Espresso because it's an old Italian settled community back in the late 1800s. >> Mhm. >> And it's just it's simply beautiful. It's it's you know, first world infrastructure is there. Alcoa operated there for a box site for a number of years. So they understand industrial processes. And the vendor that we bought the that we did the deal with uh very sophisticated ceramic engineer from Ruters like he knows his stuff. Uh pleasure to deal with too. And uh so yeah, it's just been a great experience and it's it's kind of nice to be associated with like a group of people that have put together like a world-class asset, right? It's it's kind of fun because it doesn't happen often, right? only happens to Freedelland. He seems to find them when he wakes up out of bed. But like, you know, when you when you um when you see something like this, it's quite special, right? So >> So, and environmentally, the rare earth is less challenging, I think, for the for the environment. Is that fair than >> Well, the ionic >> cyanide tanks and stuff. >> Yeah. I mean, I don't have a problem with cyanide. The Germans ruined cyanid during World War II. like breaks down with UV light. But no, it's it's it's pretty benign process except for the solvent extraction which uses some pretty crazy chemicals and kerosene and uh but the upfront, you know, ammonium sulfate, it's a common off-the-shelf fertilizer. Now, there's residual ammonia, which could be a problem. So, that's why they're using some people use magnesium sulfate, but because ammonia is a a fertilizer, right? and it stimulates algae growth which you know takes the oxygen out of the water when it gets into the water system. But in this part of Brazil uh they have lots of eucalyptus farms and you know I would imagine the the companies looking at this with the local government but like taking the spent rare earth strip clay that you know because when you take a rare earth molecule out of clay the rare earth attaches to the sulfate and the ammonia attaches to the clay it just replaces right. Um, and so, you know, you can almost say, okay, you put the ammonia loaded clay back in the ground and you plant a eucalyptus tree because there's lots of eucalyptus farms in the neighborhood and that that will be consumed by the tree. And so, you could actually have it's also Yeah, I guess it's one of the most, if anybody cares, it's one of the most green projects in the world because 98% of the energy inputs are all green in this area. >> And you could grow a tree with the with your with your, you know, you don't have to pile up tailings. You just plant a tree and let it grow and then make some money off that too, right? So, >> as far as the world goes, Brazil's a pretty stable mining friendly jurisdiction. >> Yeah. I mean, Valet, I mean, they're huge. They're one of the biggest iron ore producers in the world. They tons of gold mines down there. Yeah. It's And they've got what else? They get, you know, nobbium. They control the world's nobbium supply. Uh yeah it's a mining based economy as well amongst other agriculture is big too but they got lots of mines it's not foreign to themself. >> So is it too late to invest in rare earth you mentioned you think this is going to go on for 10 or 20 years that >> yeah well you know it's not it's I think that this genie's out of the bottle the space is going to continually grow. I think as western deposits come into the into the world the market will expand and then you'll probably even get the Chinese fighting over market share too right so which is what you know the west wants and and then the consu you know like it's always about the consumer we want to get the economy going so you need competition you need lots of lots of sources and uh yeah so I think just over time 10 years probably it'll take to get this thing going up to now from military applications I think that the US will be a lot faster than 10 years, but for overall the whole growth of the industry will probably take 10 years and it's a great uh investment because this this stuff goes into the new economy and that's what scared everybody when China was like really threatening to cut it off. Like it's like they control the new economy through these magnets. It's actually profound if you think about it, right? >> Uh and that was all by design. like they should be teaching a course at Harvard on how to monopolize a market globally cuz they have like and the barriers to entry in in areas over you know I I'm not going to go into but we had an experience over in Southeast Asia where we thought we had this deal and uh let's just say the uh it it didn't work out and it was it's almost like a spy novel and uh and um >> there were no helicopters were there >> no no helicopters but uh the deposit was real, the plant was real, and um the plant doesn't exist anymore. So that's how that's that tells you that we are on to something. And uh um and it tells you how critical this is to the trade negotiations. Like it's really critical. And so that's why I like I know it's how critical it is to trade negotiations. So >> it's it's just a space that's going to have a constant bid. It's going to be in the media all the time. That's not what it's about, but it it'll be in the vernacular all the time. governments are going to subsidize a space. The Americans are leading that, but everybody's going to do that. Canada will do that. Mexico will do that. And uh you know what it's look at, you know, EFR. I think the last time we did the interview like EFR was like seven bucks. It's it hit 30, right? >> 30. >> 30. And it's going to be it's going to be 60. It's going to be 90. Like it's not like there's no work done behind that. But like as Mark builds his business out um you know he's got the first mover advantage and he he'll get support from the USG. He already is but I think he'll get economic support is my guess. I don't know that but I would imagine and he's going to build like a a mini not a mini they're going to build a real US industrial. I think that company probably one day will be 20 to4 to50 billion market cap >> or it'll get taken over by a company become part of a conglomerate cuz I think we're going to go back to a time where you know the US will have these big big institutions like Union Carbide Dow Chemical DuPont it's all been merged into one it doesn't do anybody good they sell down these divisions and so I think you're seeing you know what was old is now new and we're going to get into these fully integrated companies because the Chinese have done that and if you can't you can't beat them as individuals right and so you know in China if you want their copper their rares their nickel their aluminina buy my car buy my cell phone buy my you know pot my pan you're not buying my concentrate >> they want to add the value along the way >> and we should do that as well and then we're going to add the value along the way that's the way it's going so it's Perfect. >> Well, unlike gold and silver, uh you can't as an investor buy the metal. >> There's no um you know, ETFs that hold this type of stuff, right? >> So, how do investors uh take advantage and you know, how big's the market? How many companies are there? And can you give us you know, not recommendations, but examples from SCPs? Uh >> yeah, I mean, there's lots of there's lots of there's lots of companies like everybody's a rare earth company now. the indexes are full of them. >> Mhm. >> Uh I would look at the space very carefully. There's some established producers like Lionus and Molly Corp. Um in Australia and the US and then you have a number of juniors that are developing these projects. Uh Mark's not a junior, he's a mid-tier now based on his market cap. But like you know if you want to be safe you go uh I would invest in uh if I were going to invest in the space meteoric simply because it's it's first class. It's the biggest best deposit in the space in the world. And then I would I would stick with uh EFR because you know Mark Mark moved on this space four years ago. He's developed his company. It's it's you know I don't know it's over I don't know what the how many billions it is but it's it's a lot and uh you know he's he's got he's got the right people in the company uh he's connected to the right people the US will uh USG will support him um and he's and he's ahead of the curve right and you know you know how it works like you know the first mover uh I'm not saying it's like Microsoft but like you know Microsoft move first over Apple was better and you know they took the whole market right So Mark will get into the market before a lot of these other companies. Um MEI will too because they're they're not too far away. And once you spec your product into the downstream that you don't change, right? So I would go from a development perspective to to invest in a in a world-class asset that will see daylight and will be in production for the next 100 years. I'd buy MEI and then I would go with the knowing that's really got the momentum and has the human capital because the human capital in this space is it's the biggest problem. It's not just this space, it's the west as a whole. We you know we gave all our industry away so why become an engineer, right? So that so he's got the team, he's got the molecules now because he's started consolidating a lot of uh heavy minands deposits and um I think he's got like a billion two on the balance sheet now. Like you know this is you know he raised a $700 million convert. It was only supposed to be like 600. They upsized it and the rate on that converts 75%. Unsecured and the conversion price was I think 30 bucks and the like four weeks later the stock's at like 28 almost through the conversion price, right? >> Mhm. So that means he's got real institutions backing him and uh I think you got to own it if you want to be in the space and that so those are the two those are the two I like the best and um >> can you give us just a two minutes on energy fuels and how it's unique? >> Well energy fuels is uh it's a unique company in the sense that it was a uranium of venadium company so they've got um one of the only uranium uh mills in the US. Um there's lots of ISL in Wyoming but conventional or wars for the whole four corners area is like kind of hub and spoke and then Mark went into rare earth and so he's got the best of both worlds because if you think about like the grid the US is going to double its grid for AI so that means Canada's going to have to double its grid and means Mexico is going to have to double its grid because you have to keep up right. >> Mhm. uh and that's going to drive uh nuclear fuel demand which will drive primary supply E308 pounds into the whole fuel cycle. So a he's he's got uran he's and actually he's mining he's mining a beautiful deposit of pinion planes he's like got grades of 70%. Now it's not a long life asset but that's what he's mining right now. Um so you get the best of both worlds. He's going to produce lots of uranium which is I think it's 80 bucks a pound probably going through the old highs which were about 60. Uh everything's going through its old old highs. Like silver's through its old highs, gold's through its old highs. So the hard ass acid trades on. Uranium will go through its old high. So he's got uranium and he's further ahead than anybody in the US. X Molly Corp or MP materials um on processing rare set of monocytes. Well, he's the only one that can process it out of monosite. So huge barriers to entry because he's got the license to handle the radionuculi. So, you've got a great rare earth business plan going forward and he will go to alloys for sure and he'll probably start tinkering with magnets at some point. And then he's got the uranium. So, it's a, you know, two-pronged beast that um happens to have the the two molecules that the markets are looking for right now, right? So, Mark's in a good position and that's what makes that company so unique. And the and the most important thing about it is he's uh it's an American company and we're living in an American renaissance world and uh so he's in he's going to be backed by you know the right people. So that's that's what makes that company so unique and you can see it just in his performance on a stock. Right. Right. >> I'm not the only one that thinks this way. So um that and then you know the other one that I can't say enough about me. It's just it's just truly, you know, that that that's just a just a incredible deposit. So, those are the two. >> Terrific. Well, looking forward to next year. Thanks for your time. I just want to give everybody a teaser and say, >> do you think SCP will be doing some work in the rare earth field in 2026? >> N7, N8, N9, N30. Yeah. >> So, we should stay tuned. >> Stay tuned. Yeah. 100%. And uh you know it's not a big industry and when it gets when it you know when all the blocks fall into place um it'll be done right and you'll get some incremental stuff but uh we're a ways away from that. Uh the big stuff will get consolidated in the next two years but there'll be you know I think this space I don't know I just think I just think the demand for these materials is you know it's not going away. it's just going to continue to be demand pull driven. So, um, so yeah, no, it's it's we're going to be in it until it's it's not worth it to be and I think we're in the like first inning of a nine inning game. It's probably going to go to a few extra innings, right? So, so it'll be fine. >> Encourage everyone. It's a very difficult space and this is an area where folks like SCP can be of great help uh in No problem. So, we're going to check in with Dave in a few months and see how things are going. Dave, thanks for your time. >> Yeah. Well, and don't forget about Justin Chan. He covers the space at the at the shop and I think he's probably the best uh rare earth analyst out there and um so feel free to pick up the phone and call Justin. He's done a he's done a great job and he's actually well thought out in his thinking as well. So, you know, he's not a linear thinker. So, he's a good he's a good conversationalist, too. So, >> pick up the phone and call us. No problem. The Justin is the head of research at SC. And >> one thing about Justin, you can pick a mine anywhere in the world, whe it's being developed or partially developed, and he has an opinion about whether it's going to make money. So, he has an enormous amount of knowledge in that head. >> Yes, he does. He does. Great person to work with, great partner. >> Anyway, Trey, >> thank you. Nice to speak. >> We'll see you this afternoon. See you at the silver conference. >> All right. Don't forget to sign up for a free portfolio review with one of our endorsed investment partners at wealthon.comfree. With markets hitting all-time highs, now is a great time to stress test your strategy and be prepared for what comes next. Thank you all for watching. We'll see you again next time.
David Wargo: The First Inning of a Rare Earth Revival
Summary
Transcript
We're going to take our industrial base back close to post World War II. So, you're going to make boats. You're going to sit fix boats. Like, you're going to we're getting back to the basics, which is if Rarus was the was the catalyst to get us going in the right direction and stop being a service economy. It's great. So, it's it's tough now, but I think long term it's going to be great for the whole continent. Demand for these materials is, you know, it's not going away. It's just going to continue to be demand pull driven. We're in the like first inning of a nine inning game. It's probably going to go to a few extra innings, right? So, so it'll be fun. >> Don't forget to sign up for a free portfolio review with one of our endorsed investment partners at wealthon.com/free. With markets hitting all-time highs, now is a great time to stress test your strategy and be prepared for what comes next. >> Greetings and welcome to our wealthy show. My name is Trey Reich and I'm here today with Dave Vargo, head of investment banking at our partners in Toronto, SCP Resource Finance. Uh we're very excited about our silver conference which is going to kick off tonight with a welcome dinner and then tomorrow uh with a full day slate started with Eric Sprat etc. and I think the cream of the crop of the silver industry pan-American first majestic uh another 12 producers and Maria Smnova from Sprat um Connor O'Brien. So, it's a an action-packed uh slate. And if folks aren't going to be here in person tomorrow, please sign up for the virtual option for this Saturday uh beginning at 8 and ending at 7, which I will be MCing. Uh so, Dave, thanks for coming. The topic today, of course, is not silver. Uh we thought uh given developments in the area of late we'd revisit the air uh area of Rarers. >> Yeah. >> So um >> lots going on there. >> Yep. And uh I don't want to do too much geological history for everybody, but >> could you just give us a brief overview when people read in the paper rarers and now it's even expanded to critical minerals. Um >> you know there's 17 rarers. I'm sure there's another 20 >> critical minerals >> and they get lumped together. Are there a few that are much more important than the others that this whole game is really about? >> Yeah, there's two um and those are the ones that are mainly situated in uh Southeast Asia. uh and they're the only two elements that um you know more or less balance the trade negotiations and that's disposium and turbium and they're referred to as the heavy rares um and they're the they are all over the world but in economic quantities you really find them in that old Southeast Asian corridor from uh southern China Lao and Vietnam and I'm sure they have some in Thailand as well and it's just very weathered Uh it's ionic uh beautiful metallurgical properties. Uh truly the champagne of uh heavy rarers and the Chinese have a a lock on it and uh yeah so that's where you find them. Um and but you know there you can find them other places. A lot of them you can find them in um uh other ionic clay deposits around the world. And you can get a lot of D and TV out of monzite, which is the radioactive um or high radio high uranium thorium ores that you would find on heavy mineral sands uh cuts. And that's what um Mark Charmer charmers at EFR is uh perfecting right now. So he's gone that route, but it's uh mainly in Southeast Asia is the where you find the two most important rares. >> I was going to ask that question. So since you mentioned it, >> can you talk a little bit about the difference between ionic clays and monazite? >> Well, ionic clay um it's mother nature's done all the work. Uh it's fully oxidized for the most part. it should be. Uh, and so the rare earth is loosely associated with the clays. Um, you don't need to drill, you don't need to blast, you don't need to crush, you just free dig and you're washing the clay with ammonium sulfate, pH of four or magnesium sulfate, pH of four, which is almost benign. Um, and you're basically getting 70% of your payability within the first five minutes. That's the true rare earth deposit. Uh and then a monzite deposit uh comes in hard rock and as well as um heavy mineral sands. And um monzite is loaded with uranium and thorium. So it's deemed a class 7. Uh when you ship it, it's class 7, which means it's very highly regulated because of the radionucleides. uh Aluca in Australia can separate them and uh they're they're they're ramping up uh and EFR in Blanding, Utah, which has just knocked it out of the park. Like I can't stress how much how well Mark Chalmer's has done at that company. And you look at the share price. Uh he's doing it down in Blanding, Utah. And then of course the Chinese can do it. Uh and the Russians can do it, but you know for the Western world it's Australia and it's EFR and it's class 7 shipment. So they're the only two that right now can handle the radionucleides and maybe uh probably um it's now salvi salv which is the old rome plonc which is the old rodia and one of the pioneers uh French company um they they would also be able to do this at larelle but you know it's a bit different when you're doing it you know in a beautiful place on the Atlantic Ocean right so uh the main two places are um that can solve that issue are landing in Aluk and Australia, but they're highly radioactive, but with that you get a beautiful mix of heavy and light rares. It's very unique and you can get high grades of like disposium and turbium and and whatnot. So, and I think Mark is putting a he's going to put a heavy mineral, it's fully licensed, he's going to put a heavy mineral sands deposit into production in Australia, and he's going to get a I don't know what the amount of DY, but it's a DY is one of the primary uh minerals that's going to come off of that. of of that production. So it's it's it's starting. So it's good. >> So one of the things that we hear all the time is that there are these types of uh ionic clays and manazite >> elsewhere in the world, but they're not large enough >> to mine profitably. And then we also hear how easy it is. You basically just wash the stuff out. >> So this is just a personal question. And I've always wondered if if you find a little bit of this stuff, it seems to be so easy to process that the barriers to entry would be low, but they're high. >> Well, yeah. You know, you can strip a rare earth out of a clay hosted deposit. Then you have to take that then you you strip it out in ammonium sulfate, right? So the rare earth attaches to the sulfate and then you will precipitate precipitate that out with with a hydroxide or carbonate. So you got a something called you'll hear in the industry mre. >> So mineral min well just your your mixed rare earth uh carbonate. Let's just call it that. You get a mixed rare earth carbonate. And then you have to take that >> and it's about 50% uh rare earth concentrate. Now and then you have to do solvent extraction and and and and uh separate out each individual um rare earth. And you think about it, the closer any two elements are on a periodic table, the harder it is to separate because there's, you know, they're very similar. So, uh, there's a lot of horsepower that goes into the downstream processing of the stuff. And that's where the West, uh, will catch up. You know, we we invented it over here. Um, the Chinese perfected it over there and they've just run away with it. So um that's where the um that's where the value ad is on the uh first part of the downstream. And then you'll take those molecules you alloy them and then you'll make magnetic materials out of them. Right? So it's pretty uh pretty pretty complex idiosyncratic process. It's not for everybody. My other uh question, since they're these 17 that everybody focuses on or that the press focuses on, the lighter rarers, if you have a lot of them, what do you do with them? It's just it just depresses. >> Well, I mean, the thing is like, you know, in a light rare earth deposit, 75% of your payability rule of thumb, uh, would be serium and lanthnum. And if you're running your process off of 20% of the overall concentration, you know, whatever that ratio is like 3, you know, whatever to one. So you're getting one, you're producing three no matter what. So there's only so many applications for serium. There's only so many applications for lanthinum. And there's always an over supply because you're running your whole process on the lights for ND and PR and on the heavies for DYTB. Um so everything else that comes along with those uh you're just going to you're going to create a lot of extra molecules and and the markets are not big enough to absorb those molecules. So the price is it's not even worth talking about. Right. >> Interesting. >> You're literally the whole rare space is based on the magnets really for the most part. And um there's lots of applications for serum and lanthinum but not enough to take up the the extra molecules that are being produced as NDPR. I think it's growing at a compounded annual rate of like 14%, right? So you're not going to you know you're not going to increase demand for serum and LAN at the same pace. So they're not worth anything in my in my books, right? But everybody puts an economic value on it and then they'll put it in their presentation. and look this up my deposit's worth and >> you have to discount it to zero basically is my my that's my rule of thumb anyway. >> Now even though rarers have been on the front page for the past year or two >> prices haven't sort of reflected that urgency have they? Well, no, because every time the west starts to bang the drum on rar and increasing production uh and you know start developing projects, the Chinese just open the faucet and they flood the market. And so a perfect example, I think I said this last time around, but the perfect example of that would be like, you know, um EFR went into the market, they were buying monzite for 500 bucks. They started cracking it, separating, producing um uh magnet grade NDPR and the next time they went into the market, the price of the concentrate was 20 times higher and it didn't make economic sense for them to separate it because the Chinese basically said we'll pay you $10,000 a ton and you know, money talks. Always tie goes to the money. So, uh, that was bent towards the east and Mark just kind of, you know, went out on a buying spree to get primary deposits for his own feed, right? And he's done a hell of a job doing that. So, >> this October, Wealthian's putting the spotlight on silver with expert interviews, deep analysis, and a special in-depth report from our partners at SCP Resource Finance. To receive this report and other exclusive benefits, you can sign up to become an accredited investor with Wealthon at wealth.com/acredited or by finding the link in the description below. Speaking of silver, Wealthon will be on the ground in Toronto for the SCP Resource Finance Second Global Silver Conference happening on Thursday, October 23rd. Legendary investor Eric Sprat headlines the event alongside 15 silver mining companies presenting their top projects. It's a mustattend for anyone serious about investing in silver. Tickets both in person and virtual are now available. Find out more in the description below. >> For viewers, I think it's important to recognize that this is a very no absolutely complicated. It is very complicated and the Chinese have developed their industry uh really I want to say for 40 years right like in Ernst they took over the industry 9798 and put Mountain Pass which is the uh deposit that the Pentagon just took a stake in to um they put that out of out of business and then they then they focused on the industry as a whole to become the rare earth leader and um they've monopolized the global market and they really have monopolized the downstream and what's amazing is we've brought the technology into the country in 2003 four five around there. So uh and they've just taken that technology and run with it. So, so 20 years they own they own the they own the house. >> Moving to uh the front pages recently. >> Y >> uh as I recall the uh sequence of the past year back in April, China put some controls on rare earth exports and it's all as a you know preamble to trade negotiations and then y >> we I what did we do? We extended the >> truce for 90 days. we did something that >> um caused them to open things up and I thought it was sort of solved >> and then yeah >> two weeks ago what happened? >> Well um the way the the trade agreement they they settled the trade agreement because I think the the US realized that they were really in a bind. You had like Ford shutting down production lines because you can't make electric cars without these u these rare magnets. And so they, you know, they obviously settled a um an extension of a of a trade agreement. It wasn't settled completely, but they got on the same page. And that allowed for the rare magnets to be starting to reexport out of China into the West. And then what the Chinese state has done is they've they've they're giving uh export licenses, but you can only sell to certain industries. So the car industry, I think, is okay. Although, you know, it's never as you know, as advertised. Like if they were if you're allowed to export one magnet, you you know, you actually had a license to, they're only exporting like half a magnet, right? So, they're not really sticking up to their end of the bargain. And that's to squeeze the Americans because they obviously want the tech like AI tech and those Nvidia chips and other things. So, they're going to use this as as real leverage. And so two weeks ago um there was a a rumor that the um they were just going to cut off rare supply to like basically the west as a whole and the whole kind of western world woke up and was you know dead set against it. I think the Chinese state kind of overplayed its hand because it's uh you know truly has a monopoly here. And then you know as a function of that and this was always in process but in as a function of that you saw Trump in uh in Australia doing the big agreement with uh not in Australia but he did the big agreement with the Australians uh on critical minerals and rarers because they've got a lot of critical minerals and rarers. You got Algo Alcoa is going in for the I think Gallion um in Australia they're going to get subsidies from the US government uh to get all this stuff going. Uh, so I think you've seen and I've seen in my own work that like it's really ramped up um the interest in the space and it's also ramped up a lot of the stuff we've been working on. It you can tell that um it's um it's become way more um oh what's the word I'm talking uh looking for? It's like when it becomes more um urgent the urg the sense of urgency is has gone through the roof, right? So, um, it's truly game on. Uh, DYTB were the only two that balanced the trade negotiations on the last settlement, and it looks like they've got a lot of leverage here. So, they're going to leverage that position to get something out of the out of the Americans is my guess, right? And I I don't think that they're going to cut us off. They may have certain industries that you can't sell to, like the Americans, you know, and or sorry, not just the American, the West have things they can't sell to the certain Chinese companies. And so it's it's going to be a it's going to be a tit fortat thing for a little while. And so I think it's something we have to get used to until till the um Americans and uh the West as a whole because the Europeans are are pushing forward too become basic in our own supply chain and rare earths and that's going to take billions of dollars of capital investment. It's going to take years of training young people to be able to do the jobs and um but we'll get there. And uh I it's almost get the feeling it's almost like um it's like a war measures act, you know, like it's like this is this is to the point where it's it's elevated to the highest people of government like Trump talks about it. So, um, it's it's game time and it's it's about time, too, because, you know, not saying we're ahead of the curve at SCP, but like we were ahead of the curve and we were, you know, we we've been going down to the States for a long time now saying this problem's going to be here. And and sure enough, it shows up. And so, I've I've had the the luxury of seeing the process, you know, and I can tell you it's uh it's certainly game on now. And it's the best thing that could ever happen to the west because it's not just rare earths like you know you talk about all the other critical minerals it's there's lots of other critical minerals that we you know like tungsten uh graphite they the Chinese control those germanmanium gallium they control those and so um every critical mineral that's on that list is something that's very important to the US government like antimony that's why the deposit out in Idaho which is run by perpetua which was the old Midas uh got IRA IRA money because they had a not only is it a beautiful gold deposit, they have this great side stream of um antimony, right? So that's another critical middle. So anything that the Chinese have basically wrapped their arms around and they did it with purpose that, you know, they don't wake up and just decide to do something on the day. It's a state planned economy, right? So this is by design. So that critical mineral list that you know changes uh all the time uh those it's it's all all the minerals that the that the basically the Chinese state more or less monopolizes right so it's good for our business I can tell you that and it's going to be fun to see you know um the US re-industrialize right because it's going to be great for Canada it's great for the US it'll be great for Mexico the whole North American continent's going to boom because uh of what's happening in the states and uh you know will they go back to a postWorld War II industrial base? Uh not 100%. But I can tell you this, the people I've spoken to uh you know they they told me get that office in New York open very soon Dave because we're going to take our industrial base back to close to post World War II. So you're going to make boats, you're gonna fix boats, like you're gonna we're getting back to the basics, which is if Rarus was the was the catalyst to get us going in the right direction and stop being a service economy, it's great. So it's it's tough now, but I think long term it's going to be great for the whole continent. So >> I just want to emphasize that uh to our viewers that throughout this whole trade uh fight with China that's been accelerating for two or three years, this is really the first time that we've seen uh Western nations uh >> show a combined resolve this quickly. You think >> 100%. 100%. Like it's it was it was unanimous, right? You it was bipartisan. It was just like no >> within a week. >> Yes. Mhm. >> Because you think about it like BMW, Volkswagen, all everybody, you know, and we are allies, you know, I think on the surface we bicker, but behind the scenes it's like, you know, there there is a there is a there is an organized medium that's, you know, that that's really tightly bound together, which is which is important, especially when you're dealing with a state controlled economy as your competitor because that's makes it very difficult for the entrepreneur and the individual right so you have to have state backing um and you know Pentagon taking 15% explicitly as you know it's not too often that the US government is explicit about what they're investing in and I think that this time around they're explicit because they want the world to know that it's it's different this time and it is different this time which is good so they're explicit about their intention and it's it's to signal to the rest of the world like it's like you know what we're we're we're getting back to work and look out right I love it it's awesome so >> now importantly introducing the government to this whole thing obviously is going to introduce a level of inefficiency so over the last couple of weeks as I listen to the morning call uh and some of these random investments or letters of interest and that type of thing tape >> you and Justin and Brandon and the team >> have your own opinions about all these minds already formed and some of them you're not too confident, you know, may be that profitable. So, doesn't this sort of mess the whole thing up too with all this government or is it just rising tide? >> Well, it's a rising tide. Plus, the the the the State Department or the Pentagon, they've guaranteed prices for for Molly for not M Well, it was Molly Corp, it's now MP Materials, whatever. >> Call it Molly Corp, its real name. And uh they they've they've uh guaranteed them $110. I think it's a kilogram for every uh pound every kilogram of NDPR they produce. Um and so that you know like you know in mining you know there's minerals everywhere. It just comes down to economic quantities and economic quantities as a function of price right. So, as the price goes up, you know, you know, if gold goes to $50,000 an ounce, you'll probably see people filtering Lake Ontario, right? Because you could probably make a penny off of it. So, as the price rises, you're going to get what was a non-economic deposit, uh, you know, getting financed and, you know, so you what what's going to happen is you're going to have a a flood of capital. It's already happening. A flood of capital come into the space. Um the good ones will get financed and uh and the bad ones will get financed and the marginal ones will get financed because all boat boats float in a rising tide whatever the expression is. >> And when um you get enough capacity into the system, enough molecules coming into the into the uh into the world again uh the price will come down um and then the marginal ones will go out of business, right? But I think that um in this case um I think >> did the government pick the right company with MP? >> Well, I mean it's the historic rare deposit. Um and you know I mean I would have chosen another one, but I you know I I'm I'm I I also understand why they did it because California you know it's in California and it's it's America for Americans and you know I don't have a problem with that. Uh and and it's still a good deposit, right? But you're getting lower into it, so you're going to get higher radionucleides, which means, you know, you're going to have a problem with uranium and thorium eventually, if they don't already. I think they do. I'm not sure, so don't quote me on that. But um there's lots of other deposits in the world um that would complement uh Mountain Pass in a in a in a significant way. Um, so look, it's it's it's not the first one I would have chosen, but I'm I'm not in the room and there's lots of other reasons behind why they do things and it's just not money. Um, what I think the most important thing that came out of that, it's like we're serious about this finally, right? And this space has just been decimated and the Chinese have just controlled it and it's going to it's going to take government support across the western world and it's going to take subsidies, right? It's like I don't know I look at it as this the new it's the New Deal 2.0, right? Um so it'll way I see the next decade going is there's going to be a tremendous amount of government subsidies across the West. uh quasi I don't want to use the word nationalization but when the government comes in it's kind of quasi nationalization and then I think once it gets off its back and once you know uh the systems running again at a good clip then you know the I guarantee the Americans will the American government will sell down its stake and it'll become you know a public company in in the capital markets on the New York Stock Exchange right so uh no problem with what they're doing and because it has to be We let everything go, right? And we became banquet waiters and look at my sleeve tattoo. It's so it's time to put a wrench in our hand and get back to work. >> Yield curve. A yield curve country. >> Yeah. >> So, um, on the MP deal, normally when the government picks a company like that to back, there would be losers. But is it fair to say that the MP deal really put a floor under everybody? >> Yeah. I mean, if the government's going to guarantee you 110 bucks, >> um, that becomes the floor price cuz, you know, even if I'm the Chinese, I'd be like, perfect. You're going to charge 110. I'll charge 110, too. Right? So, because they're going to come into the market anyway, so take extra rent. So, uh, that's that's basically the floor price for the industry, right? So, um, and that that'll stimulate lots of lots of investment, right? If you're looking for a simple, secure way to invest and own physical gold and silver, visit our sister company, hardassetsalliance at hardassetsalliance.com. That's hardassallalliance.com. Do >> you have an opinion on 110 as a price or does it not really matter? It's just they pick one and that's it. Yeah, 110 110 would be the price where it just tells me that their cash cost is $55 because rule of thumb in the mining space is your C1 cash cost times it by two typically gives you a 15% internal rate of return. And I think that that's that's the there's not a lot of magic behind it. I think that's the magic. H >> so yeah. >> So I think another thing for viewers who are looking at the space, we've already talked about the fact that even though there's a lot of pressure on supply, prices don't always cooperate. Another variable that I would like to get your perspective on if you're going to invest in sort of the rarer space, what would you say would be an appropriate time horizon? In other words, these aren't things you want to trade. Correct. No, don't trade them because the price is going to go up and down. >> Uhhuh. >> Um I think you just I think the way I would invest in the space is have a long-term perspective because the space, you know, is volatile. Um and you will hit the asmtote of pain, believe me. >> Um every space does all these things around trip, right? So, uh, I would look at long life assets that have great metallurgy. And so, on the ionic clays, they're the best in the world. That's the Champagne of Rare Earth. Um, and there's a company in uh that we've championed at SCP. Great management team, great board, great everything. Uh, they've got a they've got a beautiful ionic clay deposit in Brazil. The companyy's called Meteoric. I'm not making a recommendation to buy it, but if you want to understand what a tier one ionic clay rare earth deposit looks like, look no further than Meteoric, and that's MEI on the ASX. And um they're going to be at final investment decision uh by I think by the end of Q1 next year, so five months from now. And we've been championing this story for three years now. And the uh you know, the guys who got their hands on this project did a great job. And um we've you know helped build the company and uh and it's it's it's tier one. It's it's I think it's the best clay deposit in the world. I think it's better than anything in China too. So on the light side, sorry. >> Has Meteor always been in rares or were they mining something else? >> No, I mean it was it started out as a gold company. Typical mining. They started a gold company and then you know the the the person who ran the gold company you know befriended the vendor of the rare asset. I think his nephew or something like that helped train him as a geologist and you know built up a lot of goodwill over time. He got a phone call, what do I do with this? And then I met him about 6 weeks after and I I know what you're going to do with this. Like it's game on man. It's like >> it truly is a it's it's a worldass deposit. It would be it's like the Sbury basin is to nickel. It's like you know um Freedelland's Ivanho to copper in the Congo. It's that's it's that type of deposit, >> right? >> But for for viewers that look it up, they I didn't want them to be confused as I did that it shows up as a gold company, but it's not. >> No, it shouldn't show up as a gold company. You go on the their web page, it'll come up as a rare earth company. Okay. >> So now it's 100% rare earth. >> Oh, it's been 100% rare earths for three years. Yeah. Yeah. >> Yeah. They sold off the gold property for like 25 million bucks. And um Yeah. No, it's it's top of class. It really is. They've got um they've got a very competent board. Stuart Gail's the CEO. He's more than capable. He's very good. He's doing an excellent job. And they've got the goodies, right? They really have the goodies. And if you got the goodies, at some point the market will wake up to it. The sun will shine on you and your market cap will quadruple. It's I think it's worth like5 to$10 billion as it sits today. It's >> 1.5 billion tons. >> Yeah. Talk about the deposit. What's there? >> Well, they've got it's the average resource grade of the deposit's like 2,700 ppm. Um, which is high grade for ionic. Uh, when I met with the company, um, they had about 400 million tons and since then they've extrapolated that into one and a half billion tons at 2,700 ppm. And most importantly, it's laterally uh ionic and uh vertically down as you go down the horizon of weathering. It's it's ionic, you know, they haven't really hit the threshold of where it's not. It'll probably be ionic as you get stopped being ionic as you get close to the bedrock, right? Because it makes sense. It's not weathered. But you're looking at probably deposit, if you really think about it, probably goes to two to three billion tons. And you'll be mining that for two to three to four 500 years. Like it's your kids kids will be mining it. And um I think the demand for this stuff is going to go through the roof because all the magnets in these data centers that will drive the electric motors, all the electric motors in these in the electric cars, all the electric motors in the in the robots that everybody's talking about now, right? It's all neodymium iron boron magnets. That's so this market's just going to boom. And that's why I think even if all these other rare earth deposits, even that they're marginal at today's price, I think the demand pull, it's going to be so elastic. If you can give somebody a molecule and they know that I can actually spec this into my into my uh consumer product and not worry about having to change suppliers, not worrying about not being able to get the molecule, it's like the Chinese just don't own it. uh you'll see a very elastic uh response and I think you're going to see applications proliferate as we you know as we electrify the economy and and that's not going to change because the genies out of the bottle and um the Chinese aren't stopping so that means we can't stop right so I think it's going to be a great space to be in for the next you know 10 20 years >> and going back to MP you were talking about the drilling uh how is drilling drilling in clays different from drilling, you know, hard rock for gold. Is it cheaper to drill same amount of? >> Yeah, like a clay clay, you get an augur drill, which is just, you know, you're pulling the earth up and taking one meter, put it one meter samples in a bucket >> and you can do that with your hands, right? um a bassinosite deposit like mountain pass which we'll use as a comparison that is hard rock bassinosite no uranium and thorium in the weathered part but you got to drill it out through hard rock you got to drill it blast it crush it float it leech it precipitate it and then put it through a solvent extraction line um so your working capital there would be a lot longer and then a uh a a ionic clay deposit you dig up you wash you precipitate then you put it into your into your SX line. So your working capital is smaller. So you're used to now that we have real interest rates that you know that shortening your working capital or your work in process is very important. It's money. >> So it's just everything about a clay deposit is just it's 10 times better. It's like finding oil in Saudi Arabia. It just flows to the surface, right? That's that's what I would that's what I'd compare ionic clay deposit to. uh >> capital intensities >> capital intens sorry to interrupt our ionic clay deposits >> at depth near the surface all over the >> Oh, near the surface. It's weathered from the surface, right? >> Yeah. So, it's just a weathered like like you know it could have been an old monazite deposit. It could have been an old basinite deposit and it's just weathered, right? And so if you think where you got these these these um ionic clay deposits like lots of water, lots of heat. So all of Southeast Asia, I don't know if you've been there before in the summer, it is hot as hell. >> Uh and that those are the those are the things that drive oxidation, uh water, oxygen, and heat. And when you go to So that that's where you're finding all these ionic clays. So, and then you fast you go across the ocean and around the well, yeah, across the Pacific. And you hit Brazil and you're in the the Amazon basin. It's, you know, hot as hell in the summertime there with a tremendous amount of water and a tremendous amount of rainfall. And those are the perfect conditions to oxidize the deposit over a very long time, like millions of years. But that's what you get. you get this unconsolidated mother nature processed deposit and you don't have it's the capital is 40 cents on the dollar to a conventional like if mountain pass they just discovered it uh an equal amount of rare earth rare earth like meteoric we'll use an example so Meteor if they were to build the same amount of rare earth capacity as mountain pass okay uh the capital intensity would be 40 cents on the dollar Like that's real savings, right? And the world's broke. So, >> uh I know where I would be looking. >> It's a pretty it's it's just a no-brainer. >> And remind me where is the meteoric deposit? >> Uh it's in uh in in Brazil. You you fly into Sa Paulo. >> You drive I think northeast for three hours and it's in the it's in a caldera. I I should know the state. It slips my mind now. I've been there a few times. >> But it's in an old volcano, right? So it's contained. There's one stream out of the volcano. And so you've had the perfect containment of the mineralization to just be weathered over millions of years, right? >> And this thing's big. It's like 35 km by 30 km. >> Like it's massive. >> Yeah. Yeah. A number of times. And it's it'd be like um it'd be like having a deposit in Sbury, getting on the 401, then hitting the 400, then you know, like it's just even better than being in Sbury cuz Subbury goes down to like, you know, two-way highways. This is a three-way highway all the way. >> Then you turn turn left, you got a Espresso because it's an old Italian settled community back in the late 1800s. >> Mhm. >> And it's just it's simply beautiful. It's it's you know, first world infrastructure is there. Alcoa operated there for a box site for a number of years. So they understand industrial processes. And the vendor that we bought the that we did the deal with uh very sophisticated ceramic engineer from Ruters like he knows his stuff. Uh pleasure to deal with too. And uh so yeah, it's just been a great experience and it's it's kind of nice to be associated with like a group of people that have put together like a world-class asset, right? It's it's kind of fun because it doesn't happen often, right? only happens to Freedelland. He seems to find them when he wakes up out of bed. But like, you know, when you when you um when you see something like this, it's quite special, right? So >> So, and environmentally, the rare earth is less challenging, I think, for the for the environment. Is that fair than >> Well, the ionic >> cyanide tanks and stuff. >> Yeah. I mean, I don't have a problem with cyanide. The Germans ruined cyanid during World War II. like breaks down with UV light. But no, it's it's it's pretty benign process except for the solvent extraction which uses some pretty crazy chemicals and kerosene and uh but the upfront, you know, ammonium sulfate, it's a common off-the-shelf fertilizer. Now, there's residual ammonia, which could be a problem. So, that's why they're using some people use magnesium sulfate, but because ammonia is a a fertilizer, right? and it stimulates algae growth which you know takes the oxygen out of the water when it gets into the water system. But in this part of Brazil uh they have lots of eucalyptus farms and you know I would imagine the the companies looking at this with the local government but like taking the spent rare earth strip clay that you know because when you take a rare earth molecule out of clay the rare earth attaches to the sulfate and the ammonia attaches to the clay it just replaces right. Um, and so, you know, you can almost say, okay, you put the ammonia loaded clay back in the ground and you plant a eucalyptus tree because there's lots of eucalyptus farms in the neighborhood and that that will be consumed by the tree. And so, you could actually have it's also Yeah, I guess it's one of the most, if anybody cares, it's one of the most green projects in the world because 98% of the energy inputs are all green in this area. >> And you could grow a tree with the with your with your, you know, you don't have to pile up tailings. You just plant a tree and let it grow and then make some money off that too, right? So, >> as far as the world goes, Brazil's a pretty stable mining friendly jurisdiction. >> Yeah. I mean, Valet, I mean, they're huge. They're one of the biggest iron ore producers in the world. They tons of gold mines down there. Yeah. It's And they've got what else? They get, you know, nobbium. They control the world's nobbium supply. Uh yeah it's a mining based economy as well amongst other agriculture is big too but they got lots of mines it's not foreign to themself. >> So is it too late to invest in rare earth you mentioned you think this is going to go on for 10 or 20 years that >> yeah well you know it's not it's I think that this genie's out of the bottle the space is going to continually grow. I think as western deposits come into the into the world the market will expand and then you'll probably even get the Chinese fighting over market share too right so which is what you know the west wants and and then the consu you know like it's always about the consumer we want to get the economy going so you need competition you need lots of lots of sources and uh yeah so I think just over time 10 years probably it'll take to get this thing going up to now from military applications I think that the US will be a lot faster than 10 years, but for overall the whole growth of the industry will probably take 10 years and it's a great uh investment because this this stuff goes into the new economy and that's what scared everybody when China was like really threatening to cut it off. Like it's like they control the new economy through these magnets. It's actually profound if you think about it, right? >> Uh and that was all by design. like they should be teaching a course at Harvard on how to monopolize a market globally cuz they have like and the barriers to entry in in areas over you know I I'm not going to go into but we had an experience over in Southeast Asia where we thought we had this deal and uh let's just say the uh it it didn't work out and it was it's almost like a spy novel and uh and um >> there were no helicopters were there >> no no helicopters but uh the deposit was real, the plant was real, and um the plant doesn't exist anymore. So that's how that's that tells you that we are on to something. And uh um and it tells you how critical this is to the trade negotiations. Like it's really critical. And so that's why I like I know it's how critical it is to trade negotiations. So >> it's it's just a space that's going to have a constant bid. It's going to be in the media all the time. That's not what it's about, but it it'll be in the vernacular all the time. governments are going to subsidize a space. The Americans are leading that, but everybody's going to do that. Canada will do that. Mexico will do that. And uh you know what it's look at, you know, EFR. I think the last time we did the interview like EFR was like seven bucks. It's it hit 30, right? >> 30. >> 30. And it's going to be it's going to be 60. It's going to be 90. Like it's not like there's no work done behind that. But like as Mark builds his business out um you know he's got the first mover advantage and he he'll get support from the USG. He already is but I think he'll get economic support is my guess. I don't know that but I would imagine and he's going to build like a a mini not a mini they're going to build a real US industrial. I think that company probably one day will be 20 to4 to50 billion market cap >> or it'll get taken over by a company become part of a conglomerate cuz I think we're going to go back to a time where you know the US will have these big big institutions like Union Carbide Dow Chemical DuPont it's all been merged into one it doesn't do anybody good they sell down these divisions and so I think you're seeing you know what was old is now new and we're going to get into these fully integrated companies because the Chinese have done that and if you can't you can't beat them as individuals right and so you know in China if you want their copper their rares their nickel their aluminina buy my car buy my cell phone buy my you know pot my pan you're not buying my concentrate >> they want to add the value along the way >> and we should do that as well and then we're going to add the value along the way that's the way it's going so it's Perfect. >> Well, unlike gold and silver, uh you can't as an investor buy the metal. >> There's no um you know, ETFs that hold this type of stuff, right? >> So, how do investors uh take advantage and you know, how big's the market? How many companies are there? And can you give us you know, not recommendations, but examples from SCPs? Uh >> yeah, I mean, there's lots of there's lots of there's lots of companies like everybody's a rare earth company now. the indexes are full of them. >> Mhm. >> Uh I would look at the space very carefully. There's some established producers like Lionus and Molly Corp. Um in Australia and the US and then you have a number of juniors that are developing these projects. Uh Mark's not a junior, he's a mid-tier now based on his market cap. But like you know if you want to be safe you go uh I would invest in uh if I were going to invest in the space meteoric simply because it's it's first class. It's the biggest best deposit in the space in the world. And then I would I would stick with uh EFR because you know Mark Mark moved on this space four years ago. He's developed his company. It's it's you know I don't know it's over I don't know what the how many billions it is but it's it's a lot and uh you know he's he's got he's got the right people in the company uh he's connected to the right people the US will uh USG will support him um and he's and he's ahead of the curve right and you know you know how it works like you know the first mover uh I'm not saying it's like Microsoft but like you know Microsoft move first over Apple was better and you know they took the whole market right So Mark will get into the market before a lot of these other companies. Um MEI will too because they're they're not too far away. And once you spec your product into the downstream that you don't change, right? So I would go from a development perspective to to invest in a in a world-class asset that will see daylight and will be in production for the next 100 years. I'd buy MEI and then I would go with the knowing that's really got the momentum and has the human capital because the human capital in this space is it's the biggest problem. It's not just this space, it's the west as a whole. We you know we gave all our industry away so why become an engineer, right? So that so he's got the team, he's got the molecules now because he's started consolidating a lot of uh heavy minands deposits and um I think he's got like a billion two on the balance sheet now. Like you know this is you know he raised a $700 million convert. It was only supposed to be like 600. They upsized it and the rate on that converts 75%. Unsecured and the conversion price was I think 30 bucks and the like four weeks later the stock's at like 28 almost through the conversion price, right? >> Mhm. So that means he's got real institutions backing him and uh I think you got to own it if you want to be in the space and that so those are the two those are the two I like the best and um >> can you give us just a two minutes on energy fuels and how it's unique? >> Well energy fuels is uh it's a unique company in the sense that it was a uranium of venadium company so they've got um one of the only uranium uh mills in the US. Um there's lots of ISL in Wyoming but conventional or wars for the whole four corners area is like kind of hub and spoke and then Mark went into rare earth and so he's got the best of both worlds because if you think about like the grid the US is going to double its grid for AI so that means Canada's going to have to double its grid and means Mexico is going to have to double its grid because you have to keep up right. >> Mhm. uh and that's going to drive uh nuclear fuel demand which will drive primary supply E308 pounds into the whole fuel cycle. So a he's he's got uran he's and actually he's mining he's mining a beautiful deposit of pinion planes he's like got grades of 70%. Now it's not a long life asset but that's what he's mining right now. Um so you get the best of both worlds. He's going to produce lots of uranium which is I think it's 80 bucks a pound probably going through the old highs which were about 60. Uh everything's going through its old old highs. Like silver's through its old highs, gold's through its old highs. So the hard ass acid trades on. Uranium will go through its old high. So he's got uranium and he's further ahead than anybody in the US. X Molly Corp or MP materials um on processing rare set of monocytes. Well, he's the only one that can process it out of monosite. So huge barriers to entry because he's got the license to handle the radionuculi. So, you've got a great rare earth business plan going forward and he will go to alloys for sure and he'll probably start tinkering with magnets at some point. And then he's got the uranium. So, it's a, you know, two-pronged beast that um happens to have the the two molecules that the markets are looking for right now, right? So, Mark's in a good position and that's what makes that company so unique. And the and the most important thing about it is he's uh it's an American company and we're living in an American renaissance world and uh so he's in he's going to be backed by you know the right people. So that's that's what makes that company so unique and you can see it just in his performance on a stock. Right. Right. >> I'm not the only one that thinks this way. So um that and then you know the other one that I can't say enough about me. It's just it's just truly, you know, that that that's just a just a incredible deposit. So, those are the two. >> Terrific. Well, looking forward to next year. Thanks for your time. I just want to give everybody a teaser and say, >> do you think SCP will be doing some work in the rare earth field in 2026? >> N7, N8, N9, N30. Yeah. >> So, we should stay tuned. >> Stay tuned. Yeah. 100%. And uh you know it's not a big industry and when it gets when it you know when all the blocks fall into place um it'll be done right and you'll get some incremental stuff but uh we're a ways away from that. Uh the big stuff will get consolidated in the next two years but there'll be you know I think this space I don't know I just think I just think the demand for these materials is you know it's not going away. it's just going to continue to be demand pull driven. So, um, so yeah, no, it's it's we're going to be in it until it's it's not worth it to be and I think we're in the like first inning of a nine inning game. It's probably going to go to a few extra innings, right? So, so it'll be fine. >> Encourage everyone. It's a very difficult space and this is an area where folks like SCP can be of great help uh in No problem. So, we're going to check in with Dave in a few months and see how things are going. Dave, thanks for your time. >> Yeah. Well, and don't forget about Justin Chan. He covers the space at the at the shop and I think he's probably the best uh rare earth analyst out there and um so feel free to pick up the phone and call Justin. He's done a he's done a great job and he's actually well thought out in his thinking as well. So, you know, he's not a linear thinker. So, he's a good he's a good conversationalist, too. So, >> pick up the phone and call us. No problem. The Justin is the head of research at SC. And >> one thing about Justin, you can pick a mine anywhere in the world, whe it's being developed or partially developed, and he has an opinion about whether it's going to make money. So, he has an enormous amount of knowledge in that head. >> Yes, he does. He does. Great person to work with, great partner. >> Anyway, Trey, >> thank you. Nice to speak. >> We'll see you this afternoon. See you at the silver conference. >> All right. Don't forget to sign up for a free portfolio review with one of our endorsed investment partners at wealthon.comfree. With markets hitting all-time highs, now is a great time to stress test your strategy and be prepared for what comes next. Thank you all for watching. We'll see you again next time.