RI: Why don’t we start by reviewing your two main rare earth projects, what you’ve got going on there and where you’re creating value for investors?
AG: We are working on the Zeus property in the Peralkaline complex. It is one of the biggest in North America and we have a big land position on that complex. On the property, we have the Kipawa deposit, which is a timely, high value and low-cost deposit. We also have many zone showings and untested targets on the property and a large part of the Peralkaline complex is unexplored.
RI: You said timely, high-value and low-cost. When you say timely, do you mean first to market or close to the front of the heap to market?
AG: We have a feasibility study planned for the end of 2013 and will make a mine decision at that time to be in production by 2014 or 2015. We can fast-track this project depending on our success in the many steps ahead.
RI: You mentioned the high-value of the project, and I think the thing there for you is the heavy rare earths. People have started to hear more and more about this, can you explain how heavy rare earths add value?
AG: We are a rare earth deposit and we will produce all of the lights and the heavies but what is important for our deposit is that we have more than 35 to 40% in heavy rare earths. Mostly, we’re seeing dysprosium, terbium and yttrium and presently that is what the market is demanding today. For example, the Department of Energy in its last December report underlined five important elements that are critical for the economy, which are dysprosium, terbium, yttrium, europium and neodymium. Matamec will produce those rare earths.
RI: How big is this project?
AG: For the rare earths only it is 10 million tonnes of rare earths. The grade is around 0.65 TREO. People need to know that the South China clays produce 95% of the heavy rare earths in the world; their grades are about 0.02 to 0.03%. We are 20 times better grade than the South China clays.
RI: You’ve got good infrastructure and you’ve got a low stripping ratio. Let’s talk about some of these aspects of the project.
AG: The first important factor for industrial minerals is the location. We are located in the southwestern part of Quebec 150 kilometers east of North Bay and 60 kilometers east of Temiscamingue. We have good infrastructure with railway connecting to a railway system. We have hydro power lines. From Temiscamingue to the property we have a lot of roads and the deposit is only half a kilometer from the main road, which is a key thing.
For our three minerals we see coarse-grain and good crystallization. That is a key metallurgical point and will be easy to process. We’ve worked with an expert metallurgists, Les Heymann, who worked seven years in China on lights and heavy plants. He knows the process of rare earths. When he joined Matamec in 2008 he read everything and he believed that we can produce rare earths at a low-cost and be near the South China clays.
RI: You been doing a lot of work with Les Heymann on the metallurgy. Can you tell us about your recovery rates?
AG: The recovery leaching at present is 90%. Matamec is the first company in the world to show it would be able to recover 90% of rare earths in a deposit.
RI: When you’re drilling, where does the mineralization start?
AG: Right from the surface.
RI: What you need to do to show investors that this can be done and take this to production by 2014?
AG: Presently we are working on a scoping study to show numbers and the value of that deposit. In 2012 we will do a prefeasibility study including a pilot plant. That is our current timeline but it depends on if success—we can reduce that time and be in production sooner. We have to be conservative because we don’t know the future but we like to be optimistic.