MetalCORP

Taking the heat┬áAubrey Eveleigh, COO of MetalCORP, talks to Gay Sutton about the strategic value of finding a rare unique metal, rhenium, in Ontario. Not many of us are likely to experience a genuine Eureka momentÔÇöthat instant when you realize without a doubt that you have discovered something outstanding and unique. That is exactly what happened to the Canadian junior resource company MetalCORP Limited less than a year ago when it discovered molybdenum and rhenium at its Big Lake property in northwestern Ontario.Set up as an exploration company in 2003 by D. Alexander Sheldon and Aubrey Eveleigh to search for mineral resources in northwestern Ontario, the company has already made some significant discoveries. At the outset the companyÔÇÖs focus was gold, with the identification and development of four gold prospects at Dorset, Pickle Lake, Black Bear and Keezhik Lake, and the company now plans to spin out these four primary gold projects into a single new company under independent management. The company then shifted away from gold to base metals, and the discovery of high-grade copper and zinc in early 2006 made quite a stir on the markets, sending share prices shooting up from around 40 cents to over $2 a share. ÔÇ£WeÔÇÖve drilled about 30 holes into the BL14 Cu-Zn zone so far,ÔÇØ says Eveleigh, MetalCORPÔÇÖs COO and VP exploration, ÔÇ£but we need to make it much bigger and will be doing more drilling over the next couple of years. WeÔÇÖre trying to get it to a threshold of around three to five million tonnes so that we can make some decisions on putting it into production.ÔÇØ Then earlier this year MetalCORP found diamonds at North Rock, located 300 kilometers west of Thunder Bay, which Kennecott (a Rio Tinto plc company) is optioning into and may earn up to 70 percent by taking the GUP diamond project to the feasibility stage. But the discovery of a vein of high-grade molybdenum and rhenium-bearing quartz at the western end of the Big Lake area almost a year ago has been of greatest significance. Known as the Playter Mo-Re deposit, it is one of the largest finds of its type in the world, and the announcement of the discovery once again stirred great interest in the marketplace. ÔÇ£In terms of the dollar value in the ground, most of the worth is the molybdenum,ÔÇØ Eveleigh explains. Approximately 65ÔÇô70 percent of the worldÔÇÖs molybdenum resources are used as an alloying agent to steel, to give it strength, durability and corrosion resistance. ÔÇ£But this also turns out to be one of the highest-grade rhenium discoveries in the world, and itÔÇÖs the rhenium thatÔÇÖs attracting all the attention, because itÔÇÖs such a critical and strategic commodity.ÔÇØRhenium is one of the earthÔÇÖs truly rare and valuable metals. The entire world reserves are estimated to be not much more than 10,000 tonnes, while only about 50 tonnes are produced each year, largely as a by-product of copper and molybdenum mining. But its unique properties are what make it invaluable to industryÔÇöand, interestingly, to travel-hungry mankind.Not only does the metal have an extraordinarily high melting pointÔÇö3,180oC, which is exceeded only by tungsten and carbonÔÇöbut it remains ductile at high and low temperatures, is malleable and remains remarkably stable under stress. It is used as a constituent of industrial catalysts, but by far its greatest useÔÇö77 percent of annual resources worldwideÔÇöis in the production of super alloys used in the manufacture of turbine blades in jet engines for civil and military aircraft. ÔÇ£ThereÔÇÖs about 20 to 30 kilograms used in each jet engine,ÔÇØ Eveleigh says. ÔÇ£It gets very hot in that part of the engine, and unless you add a metal coating of rhenium to the turbine blades, they would simply come apart.ÔÇØIn todayÔÇÖs marketplace in which the cost of oil has risen so dramatically, breaking the $100 a barrel level, organizations are searching for ways to economize on the use of fossil fuels. Rhenium is capable of doing exactly that for the aerospace sector. Civil and military aircraft engines, like most internal combustion engines, function more economically at higher temperatures. ÔÇ£If you run an engine hotter, it will burn fuel more efficiently and will therefore save money and produce fewer emissions into the atmosphere. One way to do that is to increase the content of rhenium in the turbine blades. ItÔÇÖs an upfront initial cost to the aircraft engine maker, but it would save billions of dollars in fuel over the lifetime of the aircraft.ÔÇØ The rhenium found at MetalCORPÔÇÖs Big Lake property could therefore have a serious impact on the cost of flight and could also play a part in lowering carbon emissions. Over the last few months the company has been assessing the extent of the find, drilling to an east-west strike length of 750 meters and a depth of 650 meters. ÔÇ£The vein of molybdenum and rhenium is of high grade and is averaging seven to eight meters wide. WeÔÇÖre now doing a calculation to see how big it is down to the 650-meter level. But it still remains open at depth,ÔÇØ he says. MetalCORP has hired AMEC to carry out this resource study.Eveleigh then went on to explain his plans for MetalCORP in the short term and the long term. ÔÇ£WeÔÇÖve gotten interest from some major corporations, and I expect within the next few months that we may be able to attract a good strategic partner and then develop the site so that mining can take place in two to four years.ÔÇØ Once that partner is on board, a full feasibility study can be done to ascertain the financial prospects of the site. Of course, the commodities market has gone through a dramatic boom during the past three or four years, stoked by soaring demand from the emerging economies of China and India. And although the recent global financial crisis has dampened demand for commodities somewhat, Eveleigh believes that demand for rhenium still is, and will continue to be, very strong for the foreseeable future. Should the Playter deposit prove to be as productive and lucrative as it promises, Eveleigh intends to turn his attention to further exploration in the vicinity. ÔÇ£Once you find one, thereÔÇÖs a very good likelihood of finding more, and we have found other occurrences of molybdenum and rhenium in the region that we havenÔÇÖt yet developed.ÔÇØ There is another reason why MetalCORP stands a great chance of succeeding with another discovery: it is the biggest landholder in the area. ÔÇ£WeÔÇÖve got a lot of area to explore with a great team. I like our chances,ÔÇØ he says.┬á