Podcast summary and Notes on "od6"

OD6 Metals Limited (ASX:OD6): The Path To Production - 2024

As we close off 2023, what a better way to end with Coffee with Samso Episode 193 is with Brett Hazelden, Managing Director and CEO of OD6 Metals Limited (ASX: OD6).

The Rare Earth story is now reaching a stage where it is now all about the chemistry. Most followers of the sector are now assuming and accepting that companies will report minerals resources that will be large enough to sustain any operations.

What is unknown is the cost of the chemistry that will bring in the revenue and profits at the end of the exercise. I think in this episode of Coffee with Samso, Brett Hazelden makes a very compelling case for the OD6 Metals story. There is a lot of confusion in the market in terms of what is the end game for these clay rare earth projects.

Brett is a metallurgist and he comes from experience when he talks about the downstream process. For those viewers who are pondering about the Rare Earth sector, this is a must watch episode of Coffee with Samso.

Samso Conclusion

As many of you who have followed the Samso platform, you would have been watching a lot of Rare Earth stories lately. There is no doubt that the rare earth industry is very complicated and confusing which is primarily being fuelled by a cloud of uncertainty on the future. This is something that I had as well but you would have heard me mention this very often, recently, that the trip to the rare earth conference in Canberra has pretty much cleared it up for me.

My optimism that was derived from the conference is not an indication that the sector is going on a bull run. My thoughts are that the reality of a strong future for the demand of rare earths will be very profitable for the companies that stick to their work and are able to sustain their path with funding.

The ability to attract funding over the period is critical. In some ways, you could look at the this time of the market as a reset of the rare earth story, in terms of valuation. This is the time to do your DYOR. For all investors, if the commodity boom is around the corner and the rare earth metals are part of that run, then you would want to do some good research now.

Chapters:

00:00 Start

00:20 Introduction

01:03 2023 recap

03:32 Understanding the chemistry

07:14 Lowering the costs of production

09:45 Discussion about ESG

11:27 What is driving the economics of these clay projects?

15:46 Difference between Australia and South America - grade and processing route?

19:38 Takeaways from the Canberra REECon

26:16 What’s on the cards for 2024?

32:03 Discussion about the rare earth market price

35:14 News flow

36:04 Final thoughts

39:46 Conclusion

Coffee with Samso

enDecember 21, 2023

ree

od6

ree exploration in esperance

brett hazelden

australian rare earth projects

All about the REE market with OD6 Metals Limited (ASX:OD6)

Coffee with Samso Episode 170 is with Brett Hazelden, Managing Director and CEO of OD6 Metals Limited (ASX: OD6).

The space in the Rare Earth sector is maturing fast and the understanding of the sector is highly sought after by investors and companies. Brett Hazelden has again, given us a masterclass on all aspects of the Rare Earth Industry.

The Story of OD6 Metals Limited (ASX: OD6)

OD6 Metals is all about Rare Earths Elements (REE) in the southern region of Western Australia. It is located just north of the town of Esperance. As we were doing this Coffee with Samso, the market capitalisation of the company was around AUD26M and the share price was sitting around AUD 0.25.

The company is focusing on both the Grass Patch and Splinter Rock project which have both undergone drilling campaigns defining potential resources. The most recent announcements have highlighted the recent activities at both projects.

Figure 1: Project locations for OD6 Metals Limited. (source: OD6 Metals)

The Word According To Brett Hazelden

For those readers that have been following the Samso platform, you will know that the last two Coffee with Samso has been in this commodity space. The general specifications of the Rare Earth sector is fundamentally the same.

We all know what the metals do and why they are important. As I have said many times, the key to the Clay Rare Earth sector is all about how to solve the downstream processing. The unlocking of this will open a floodgate of opportunities for both investors and companies.

What are the Key Points of the Unlocking of the Downstream Process?

One of the benefits of talking to so many industry leaders is that I am learning all the recent technologies and thinking processes. What the small cap industry excels in is the ability to think fast and nimble to get the story on track.

In the world of Rare Earth, Clay Rare Earth deposits, there is such a thing called "Refractory" and "Free Leaching" deposits. When I heard that, I had a light bulb moment. My first thought was that companies with free leaching clay deposits will be first cap of the "unlocking" process.

As everything is so new, this is one way of prioritising which company or what to look for in "stories". There are many other factors but I guess this is a great way to understand what companies have in respect to the geology and the potential of future deposits.

Samso Conclusion

There is nothing new for OD6 Metals Limited. The path forward is to generate tonnage and grade while they are looking for the answer to the processing part of the equation. The unknown part of the equation is not about the ability to extract the Rare Earths from the clays, as Brett mentioned. The question is what is the process to do this with best practice environmental process that will pass the test of time and the ESG signoff.

The biggest asset that OD6 Metals (apart from the obvious) is that the adjacent assets owned by other companies in the region are also facing the same issue and have similar resources. The collective group is making this region a Rare Earth province.

I have mentioned previously that my thoughts are that the government conversations indicate to me, that there is a potential of creating a Rare Earth downstream industry in Australia. The current political rhetoric with the rising China Cold War stance may indeed force the Australian government to react and this would be a great occasion for all those involved in the Southern Region of Western Australia.

Chapters:

00:00 Start

00:20 Introduction

01:13 Who is OD6?

01:54 How has the Airborne Electromagnetic Survey (AEM) worked for OD6.

03:40 OD6 is more about Size rather than Depth.

04:36 How has your understanding changed?

07:41 Differences between Grass Patch and Splinter Rock.

10:50 Differentiating Refractory styles to Free Leaching Styles of the REE Clays.

14:25 Are the Chinese more Clay or Ionic styles?

19:00 Can Ionic clay be a major commodity Industry?

20:23 How much has the rare earth market changed?