Canadian Critical Minerals - Copper Developer Unlocks Value Amidst Market Turmoil

• Canadian Critical Mineral has two primary copper projects - the advanced Bull River Project and the earlier stage Terry Project.
• The company restructured debt and executed an ore purchase agreement (OPA) with New Afton to generate near-term revenue.
• The OPA will process 180,000 tons of stockpiled material from Bull River through an ore sorter, netting an estimated revenue of $4.5-$5M over 15-18 months.
• President & CEO Ian Berzins states this cash infusion will cover costs, remove financing concerns in the near term, and avoid further dilution.
• The focus is on methodically advancing Bull River to a production restart while retaining upside exposure at Terry through a 39% interest.

About Canadian Critical Minerals

Canadian Critical Minerals is a mining company focused on developing two copper projects in Canada. Their main asset is the 100% owned Bull River Mine project located near Cranbrook, British Columbia. This project contains a Mineral Resource with over 135 million pounds of copper, as well as gold and silver. Canadian Critical Minerals also has a 39% interest in the Thierry Mine project near Pickle Lake, Ontario. The Thierry project has a Mineral Resource with over 1.3 billion pounds of copper, along with nickel, silver, palladium, platinum and gold.

With these two assets, Canadian Critical Minerals is positioned to become a leading copper producer in Canada. The company is focused on bringing the Bull River and Thierry projects into production in the near-term. Canadian Critical Minerals states they are committed to responsible mining practices and aim to create value for shareholders while making positive economic and social contributions to local communities. The significant copper resources at these two projects provide Canadian Critical Minerals with substantial growth potential as a Canadian copper mining company.

In a recent interview, CEO Ian Berzins provided updates on these projects and the company’s plans to generate revenue and avoid dilution amidst the current difficult market conditions. Berzins acknowledged the company’s share price has dropped significantly, from 10 cents to around 3 cents, despite executing plans and advancing projects. He cited the large secured debt, permitting delays, and uncertainty around timelines as factors impacting sentiment. However, the company has taken steps to address these issues.

Interview with President & CEO, Ian Berzins

Debt Restructuring Provides Breathing Room

The debt owed to off-take partner Ocean Partners was restructured, removing a major overhang. As Berzins stated: “We worked hard to get rid of that. The other issue was real uncertainty with permitting.” The $5M debt and interest owed to insider Aaron Madlock was converted into a 3% net smelter royalty (NSR) specific to the Bull River project. This NSR provides a potential upside for Matlock while cleaning up the balance sheet.

In Berzins’ words, “We are at the point right now that for whatever reason, we're like a lot of juniors, there's just not much love for our business.” However, he emphasized they have moved the needle on execution despite lagging share price performance.

Bull River - Flagship Advanced Project

Contrary to what some may think, Bull River is the company’s most advanced project with about $100M of infrastructure already in place. Berzins estimates it requires under $10M to reach production. The project was previously produced, but the mine has been dewatered for 15 years. Accessing the large existing underground workings can accelerate restarting operations.

“Bull River is our flagship. It requires less than $10M Canadian capital to finish it off.”

In comparison, the Thierry project will need extensive drilling over the coming years to expand resources before any production decision. Canadian Critical Mineral retains a 39% interest in Thierry after bringing in a new partner to advance exploration. This allows the company to focus on Bull River in the near term while maintaining upside exposure.

Ore Purchase Agreement to Generate Cash Flow

To boost near-term cash flow, Canadian Critical Mineral executed an ore purchase agreement (OPA) with New Afton to process material from Bull River at their New Afton mine. Initially slated to begin deliveries in December 2023, permitting delays pushed the timeline, highlighting common challenges.

Nonetheless, the OPA remains in place. The company will first process 180,000 tons of surface stockpile material through an ore sorter to pre-concentrate higher-grade material for delivery to New Gold. This should net around $4.5-$5M in revenue over 15-18 months. Berzins highlighted how this will provide a critical infusion of capital: “On a monthly basis, we should have a steady, steady revenue stream...So the net on this whole exercise for us may only be $4.5-$5m, but that's a godsend to us.”

The cash flow will cover ongoing costs like the $250k per year required to keep the Bull River mine dewatered. It also removes financing concerns in the near term.

Avoiding Dilution Remains Key

Generating cash flow while avoiding dilution has been a central focus. Even with the OPA revenue, Berzins acknowledges markets may still make it difficult to raise even $10M-$15M for pre-production capital. Thus, the goal is to deploy the incoming cash prudently and move the project forward without excessive shareholder dilution.

Getting the underground tunnels rehabilitated to enable safer access for drilling and development is one priority for the capital. Berzins also highlighted the potential to do further exploration drilling, stating results from 150m below existing workings were highly encouraging.

The Plan Forward

Canadian Critical Mineral has taken strategic steps to clean up its balance sheet, generate revenue, and retain upside optionality at its core projects despite navigating difficult markets.

The ore purchase agreement provides capital to keep advancing the flagship Bull River copper project without further dilution. Meanwhile, the Thierry project offers continued exposure to expanded resources through the company's retained interest. CEO Ian Berzins reiterated that these projects in established mining regions should attract substantial interest once copper markets improve. For now, the focus is on keeping costs low, avoiding dilution, and methodically moving Bull River closer to a production restart.

With copper fundamentals projected to tighten in the coming years, Canadian Critical Mineral aims to have its projects poised to benefit at the right time. The ore sorting agreement and debt restructuring have provided much-needed breathing room during the current slump in junior resource equities.

The Investment Thesis for Canadian Critical Minerals

• Leveraged to copper – Two advanced copper projects positioned to benefit from expected copper supply deficits.
• Near-term catalysts – Ore purchase agreement to generate cash flow starting in December 2023 without dilution.
• Optionality – Bull River provides a clear path to restart production while Thierry offers upside exposure through 39% interest.
• Significant infrastructure in place – Approximately $100M of existing infrastructure at Bull River provides a head start once financing markets improve.
• Exploration upside – Past high-grade drilling results below existing Bull River workings indicate resource expansion potential.
• Strategic moves extend runway – Debt restructuring and OPA provide breathing room and reduce financing risks in the near term.
• Undervalued relative to peers – Market cap of ~$7.5M does not reflect extensive existing infrastructure and advanced nature of projects.
• Critical minerals focus – Copper and other battery metals leverage government support for domestic critical mineral supply.
• Experienced leadership – Proven ability to navigate tough markets and add value through strategic deals.