Lithium Junior Grid Metals Presents Opportunity for Investors Seeking Battery Metals Exposure

• Grid Metals, a Canadian exploration company headed by CEO Robin Dunbar, focuses primarily on lithium and nickel mining in Manitoba.
• The company attended a recent conference, where they noted a growing interest from industry professionals in lithium supplies, indicating a positive market for their exploration projects.
• Grid Metals' share price has decreased, influenced by weakened lithium prices and the challenges of standing out among numerous lithium projects.
• The company is progressing with 2 new resource statements: one for nickel and copper at Mayville, and another for the Donner Lake lithium pegmatites. They aim for toll mining with the nearby Tenko mine, with potential permits for operations as early as next year.
• Grid Metals has an ongoing strategy to be a dominant junior in southeast Manitoba, actively working on three projects with a series of drilling activities, metallurgical reports, and permitting processes. They hope for more market recognition as they continue their work.

Grid Metals Corp (GRDM) is a Canadian lithium and nickel exploration company focused on critical metals projects in Manitoba. With promising drill results at its lithium project and an updated resource estimate coming soon for its nickel-copper project, Grid Metals offers investors upside potential through exposure to battery metals.

Strong Industry Interest for Lithium Concentrate

At the recent PDAC conference, Grid Metals CEO Robin Dunbar noted strong interest from lithium traders and downstream companies looking to secure supplies of lithium concentrate. While junior mining companies are struggling in the current market environment, the ongoing demand for lithium from the electric vehicle supply chain bodes well for companies like Grid that are advancing lithium projects.

Although lithium prices have softened recently, Dunbar believes there is an opportunity for Grid to generate significant cash flows from even a relatively small mining operation, given the strong demand for lithium concentrate. The company is focused on fast-tracking permitting and development timelines to capitalize on the market opportunity.

Advancing the Donner Lake Lithium Project

Grid's Donner Lake lithium project, located adjacent to the producing Tanco lithium mine in Manitoba, is the company's flagship project. Grid is currently completing a drill program at Donner Lake and expects to publish a maiden resource estimate of between 5 to 10 million tons in mid-2022.

This resource size would be sufficient for Grid's goal of commencing small-scale toll mining and processing of lithium ore at the Tanco facility. Grid is engaged in permitting for a bulk sample collection and mining license, with the potential permit approval as early as 2023. The Tanco mine operators have expressed interest in securing additional lithium feed, presenting a ready path for Grid to begin generating revenues.

Smooth Permitting Progress Expected

Given Donner Lake's relatively low environmental impact and Grid's extensive baseline work and First Nations consultation already completed, Dunbar believes the permitting process will progress smoothly. The supportive permitting environment in Manitoba and critical minerals status of lithium should also facilitate rapid approval.

Updated Resource Coming for Nickel-Copper Project

At its Mayville nickel-copper project in Manitoba, Grid is about to publish an updated resource estimate that Dunbar expects will demonstrate significantly more contained metal compared to the previous resource. Additional drilling is underway currently to provide further upside. The Mayville resource update will be an important catalyst for Grid, providing a valuation boost and highlighting the multi-commodity potential across Grid's portfolio.

New Lithium Discovery in the Works?

Grid recently acquired the Falcon Lake West lithium project in Manitoba and foresees strong prospectivity there based on historic (but previously unreleased) drill results pointing to high-grade lithium. Assay results from those holes are pending and could represent a compelling new lithium discovery for the company in an ideal jurisdiction.

Funded for Exploration Campaigns

With approximately C$9 million in the treasury, Grid has ample capital to continue advancing its key lithium and nickel projects in Manitoba. The company expects a steady news flow over the rest of 2022, including drill results from ongoing campaigns, metallurgical studies, permitting milestones, and the pending NI 43-101 resource updates.

Valuation Appears Disconnected from Fundamentals

Despite Grid's solid project fundamentals and clear strategic plan, the company's share price has declined in recent months along with the overall junior mining sector. This disconnect presents an opportunity for investors looking to gain upside leverage from Grid's strengthening project fundamentals.

As Grid continues to hit key development milestones at Donner Lake and its other projects, the market should begin to recognize the company's potential. The pending NI 43-101 resource updates could serve as important catalysts in this regard. For investors with a medium to long-term outlook, current weakness in Grid's share price allows an attractive entry point.

Conclusion: Leverage to Battery Metals in Top-Tier Mining Jurisdiction

With lithium and nickel projects located in Canada's safe and stable mining jurisdiction of Manitoba, Grid Metals offers investors upside exposure to battery metals demand growth. Near-term catalysts, strong industry interest in lithium concentrate and Grid's cash position equip the company to continue advancing its projects towards production. For investors seeking assets with both critical minerals status and proven mineral endowment, Grid Metals warrants consideration.

Leverage to Growing EV Battery Metals Demand

Grid's lithium and nickel projects are strategically positioned to benefit from surging demand for these key battery metals driven by electric vehicle adoption. With EV sales projected to rise dramatically over the next decade, demand for raw materials is anticipated to outstrip supply. Grid offers leverage to this battery metals growth trend.

Near-Term Catalysts

With two NI 43-101 resource updates pending in 2022, Grid has clear near-term catalysts that could re-rate the stock higher. Positive resource updates showing sizeable tonnage and grades would showcase the quality of Grid's assets. Additionally, progress on permitting and development timelines for the Donner Lake lithium project provides operational catalysts.

Undervalued Compared to Peers

Despite advancing quality battery metals assets, Grid is trading at a fraction of the valuation of many lithium development peers. The current depressed valuation represents a buying opportunity, especially considering the pending milestones. As de-risking occurs, Grid's valuation disconnect should narrow.

Cash Position Funds Exploration

With C$9 million in cash, Grid is fully funded to continue advancing its Manitoba projects. The company can aggressively explore and develop without any financing overhang. The treasury eliminates dilution risks in the near to medium term.

Jurisdiction Safety

Grid's location in Canada's safe, mining-friendly Manitoba jurisdiction de-risks its assets relative to projects in less stable regions. Manitoba has demonstrated support for responsible mining investment and development. Jurisdictional safety provides confidence in Grid's ability to advance projects.

In summary, with exciting assets, near-term catalysts, an undervalued share price, a strong cash position and safe jurisdiction, Grid offers investors an attractive risk/reward opportunity within the EV battery metals space. As the company unlocks value across its portfolio, upside potential exists especially for the right lithium companies.

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