Palladium One Mining - Everything You Need to Know November 2023

About Palladium One Mining

Palladium One Mining Inc. (TSXV: PDM, OTCQB: NKORF, FRA:7N11) is a Canadian mineral exploration company focused on discovering and developing deposits of metals used in green transportation and renewable energy applications. The company is targeting nickel, copper, cobalt, and the Platinum Group Metals (PGMs) palladium, platinum, and rhodium. These metals are key components of electric vehicle batteries, charging infrastructure, and catalytic converters to reduce emissions.

Palladium One has assembled a portfolio of district-scale assets in mining-friendly jurisdictions. The flagship Läntinen Koillismaa (LK) PGE-Cu-Ni project in Finland hosts an NI 43-101 compliant resource of 1.1 million ounces of precious metals with significant co-product metals. Exploration continues along the 38km mineralized trend to expand resources. In Canada, the Tyko Ni-Cu-PGE and Canalask Ni-Cu-PGE projects offer additional large-scale discovery potential in established mining camps.

An experienced technical and executive team is leading exploration, metallurgical, and environmental programs to advance Palladium One’s projects. The company is committed to sustainable and ethical development, with a focus on minimizing environmental impacts, fostering positive community engagement, and providing a safe, diverse, and inclusive work culture.

With global PGM supply tightening, surging demand from the automotive sector, and broad policy support for electrification, Palladium One is well-positioned to play a vital role securing the metals needed for cleaner transportation.

Corporate Overview

Palladium One has assembled a portfolio of district-scale assets targeting metals vital for the transition to renewable energy and electric transportation. The company was founded in 2019 and is headquartered in Toronto, Canada, with operations in Ontario and Finland’s Läntinen Koillismaa district.

As of November 2023, Palladium One has 393 million shares outstanding, giving it a market valuation of approximately $25 million based on a share price of $0.07. The company has a strong cash position, with an estimated $12.5 million in the treasury as of September 2022 to fund ongoing exploration and development programs.

Palladium One has attracted support from leading institutional investors, including a 10.5% stake held by Eric Sprott and a 9.99% position by global commodities trader Glencore. Independent research coverage comes from firms including Echelon Partners, Sprott Capital Partners, and Research Capital, with price targets ranging from $0.30 to $0.65 per share.

The company is led by President and CEO Derrick Weyrauch, who founded Palladium One in 2019. He brings over 30 years of mineral exploration and mining finance experience to the role. Other key executives include VP Exploration Neil Pettigrew, a geologist with two decades focused on Ni-Cu-PGE deposits, VP Corporate Development Steven Velimirovic, a veteran mining investment banker, and Chief Financial Officer Sara Hills, a Chartered Professional Accountant with experience at majors like KGHM International and Teck Resources.

The board includes independent directors like Dr. Peter Lightfoot, a globally recognized expert on nickel and PGM deposits after a 30+ year career with Inco and Vale, and Giovanna Bee Moscoso, a mining lawyer and executive with over 25 years in roles like VP and Assistant General Counsel at Barrick Gold.

Mineral Assets

Palladium One’s project portfolio comprises district-scale assets targeting nickel (Ni), copper (Cu), cobalt (Co), and the precious Platinum Group Metals (PGMs): palladium (Pd), platinum (Pt), and rhodium (Rh). These metals all play vital roles in renewable energy systems, electric vehicle manufacturing, and cleaner transportation technology.

The global shift towards electrification is driving acute supply deficits, especially for nickel and PGMs. Capital investments of $1.2 to $1.7 trillion will be required over the next decade just for EV battery manufacturing and charging infrastructure based on current adoption trends, according to the International Energy Agency. While palladium and platinum enable catalytic converters to curb emissions from internal combustion engines, nickel and cobalt are irreplaceable components of lithium-ion batteries. Copper wiring and motors are ubiquitous across all forms of electrified transportation.

Palladium One’s projects position the company to benefit from surging demand for these critical “green metals” needed to reduce the transportation industry’s massive carbon footprint.

Tyko Ni-Cu-PGE Project – Canada

Palladium One’s Canadian asset is the 30,000-hectare Tyko project located approximately 65 kilometers northeast of Marathon, Ontario. Consisting of 271 claims along a 30km strike length, Tyko sits within the highly prospective Mid-Continent Rift nickel-copper-PGE district; however, Palladium One made the initial discoveries here after initial prospecting in 2020.

The project hosts high-grade nickel-copper-cobalt sulfide mineralization across multiple zones. Notable drill hole intercepts over 3 to 4-meter widths include 10.2% Ni, 8.8% Cu, and 1.4 g/t PGEs; 9.1% Ni, 7.9% Cu, and 1.6 g/t PGEs; and 4.7% Ni and 0.8% Cu. Tyko contains both primary magmatic sulfide textures and remobilized structural-type sulphide mineralization similar to the world-class Sudbury mining complex. Some veins contain over 50% nickel-bearing pentlandite.

Exploration has delineated 30+ electromagnetic geophysical anomalies that point to a much larger mineralized system than currently drill tested at Tyko. Over 45 drill holes from the 2022 campaign are awaiting assay results which should drive significant resource potential estimates over the coming year. Echoing the major discovering at LK, multiple underexplored zones at Tyko offer substantial upside once systematic exploration programs trace the extents of these impressive high-grade nickel-copper-PGE showings.

With district-scale potential confirmed and an aggressive $5 million budget for 2023 exploration, Tyko provides major blue-sky upside for additional sulphide discoveries in Palladium One’s backyard amidst the infrastructure-rich Ontario mining belts.

Läntinen Koillismaa PGE-Ni-Cu Project – Finland

The Läntinen Koillismaa (LK) project is located in north-central Finland, a top global mining jurisdiction that produces over 40 mines products annually. Hosted in the LK volcanic complex, one of Europe’s major PGE-bearing layered intrusions, the project benefits from excellent access to infrastructure, skilled labor, and downstream metal processing facilities.

In April 2022, Palladium One published an NI 43-101 Mineral Resource Estimate for LK comprising 38.2 million tonnes in the Indicated category at 0.89 g/t palladium+platinum+gold, plus 0.13% copper, 0.11% nickel, and 65 g/t cobalt. This equates to 1.1 million ounces of precious metals with over 300 million pounds of copper and nickel co-products. An additional 49.7 million Inferred tonnes contains a further 1.1 million ounces precious metals with even more significant base metal grades.

The current resource covers just 5km of the +35km mineralized strike length identified to date through drilling and geophysics. Multiple zones remain open for expansion. High-tenor sulfide mineralization indicates potential for higher-grade massive sulfide development at depth, with one such target called KS looking prospective for 10% nickel, 13% copper, and over 80 g/t total precious metals in potential massive sulfide lenses.

Metallurgical testing on LK material has delivered excellent results. Bulk rougher flotation achieves 74% palladium recovery, 89% copper, and 30% nickel to produce clean, high-value copper and nickel concentrates at conventional Palladium grades over 40 g/t and nickel grades nearing 5%. Based solely on metal pricing, the value of these concentrates exceeds $4,800 per tonne of mineralized material processed.

With district-scale potential and solid economics, LK offers a clear path towards resource growth and development of a low-cost, open-pit mine producing palladium and base metal by-products to leverage exposure across multiple critical “green metals”.

Additional Earlier Stage Assets

Beyond LK and Tyko, Palladium One controls over 100,000 hectares of prospective property across various nickel, copper, gold, PGE, and base metal opportunities. While early-stage, these additional assets provide optionality for future mineral discoveries leveraging the growing understanding of regional geology and structure gained through flagship project exploration.

The Canalask project in Yukon, Canada produced high-grade nickel-copper-PGE grab samples from showings across its 3,400-hectare footprint. Historic work and geophysical surveys point to feeder-type Ni-Cu-PGE deposit potential. Prospecting continues seeking to vector towards the source of metals strewn across the claims.

At the Hemlo East gold project 40km southwest of Tyko, a earn-in agreement with major miner Barrick Gold (10km from Barrick’s operating Hemlo mine) represents upside optionality on new exploration in the region. The Big Lake and North Rock projects provide earlier stage Cu, Ni, Zn, and precious metals opportunities in Ontario.

While not the immediate focus, these earlier stage projects provide low-cost opportunities for Palladium One to potentially secure additional district-scale assets for its project pipeline should systematic exploration unlock value.

Growth Strategy

Palladium One is advancing a strategy targeting growth in resources, scale, and ultimately shareholder value leveraging its portfolio of Ni-Cu-PGE assets. This comprises several key focus areas:

Continuing Exploration & Development at Flagships: Steady news flow from exploration, metallurgy, environmental studies and project development milestones at Tyko and LK should demonstrate resource expansion potential and de-risk assets towards eventual production decisions.

Securing Strategic Partners: Attracting investments from global miners like existing stakeholders Glencore and Barrick Gold validates assets and provides technical inputs to optimize exploration. Potential future JV partnerships could fund development while allowing Palladium One to retain upside leverage.

Consolidating District Scale: The LK and Tyko areas host clear evidence on the vast scale of these mineralized systems, which Palladium One’s regional consolidation has only begun to unveil. Systematic exploration can help trace the extents of these deposits and maximize their monetization potential through staged resource growth.

Advancing Other Assets: While not the current priority, Palladium One’s additional earlier stage assets provide low-cost opportunities for discovering new district-scale assets across a range of battery and catalytic converter metals should exploration systematically unlock their potential.

Pursuing Consolidation: In a fragmented junior mining sector, accretive acquisitions of prospective properties near existing projects offers a cost-effective growth strategy, provided they bring clear synergies and demonstrable exploration potential.

With surging metals demand supporting attractive commodity pricing environments, executing this strategy focused on resource expansion could propel Palladium One towards intermediate producer status able to bring multiple assets into production to satisfy market shortfalls.

Importance of Metals Palladium One is Targeting

The common theme across Palladium One’s mineral assets is targeting metals that enable cleaner transportation and greener energy systems. Specifically:

Nickel (Ni) is an essential component of lithium-ion batteries providing energy density and storage capacity. Automakers are transitioning towards higher-nickel cathodes (80%+ Ni) to enable longer range at lower costs. Supply shortages are projected as EV adoption accelerates.

Copper (Cu) provides Conductivity for wiring and motors across electrified transport. EVs utilize 4x more copper than internal combustion vehicles. Demand could outstrip declining global production around mid-decade.

Platinum (Pt) and Palladium (Pd) are PGMs vital to catalytic converters which curb emissions from gasoline and diesel engines. Tighter environmental regulations are increasing PGM loadings at the same time as automotive demand rises globally.

Cobalt (Co) enables greater energy density, stability and safety of lithium-ion batteries. Though substitutes are being explored, cobalt remains a major cathode component, especially for longer-range EV models.

These “new-economy” metals face structural supply deficits, especially as the clean energy transition accelerates. Policy support like the Inflation Reduction Act in the United States with over $370 billion earmarked for energy security and emissions reductions provides further demand tailwinds. Auto giants like General Motors and Volvo now aim for 50%+ EV sales mix by 2030.

Overall, surging metals demand from transportation electrification contrasts sharply with aging mines and scarce new project development in safe jurisdictions. Existing primary nickel and PGM production is concentrated in nor easily accessible Russia and South Africa. Lead times for new mines now stretch towards a decade. Juniors like Palladium One advancing district-scale assets in mining-friendly Finland and Canada offer a vital supply response in the face of massive deficits looming for the very metals needed to address the climate crisis.

Investment Highlights

Palladium One Mining offers investors leverage to in-demand nickel, copper and precious metals vital for cleaner transportation and renewable energy. Key highlights include:

Fully Funded to Execute Strategy: With an estimated $12.5M cash balance at end of 2022 quarter, existing capital can support systematic exploration to grow resources at Tyko and LK over the coming year.

World-Class Assets in Top Mining Jurisdictions: Finland and Ontario, Canada offer skilled labour, excellent infrastructure and policy support for responsible, sustainable mining critical to the low-carbon transition.

NI 43-101 Compliant Mineral Resource Estimate Validates Flagship LK: Over 1.1 million ounces palladium+platinum+gold with major by-product copper & nickel provides a solid platform for expansion along the 35km underexplored complex.

Tyko Emerging as a Major New Nickel-Copper-PGE District: High-grade Ni-Cu sulphides across 30km mineralized strike with 30+ untested geophysical anomalies signals major discovery potential on par with LK.

Metallurgy Supports Robust Mine Economics: Impressive >74% recoveries into high-value, clean concentrates provides confidence for eventual production decisions, while exploration continues expanding resources.

Surging EV Adoption Driving Massive Metals Demand Increase: Tight nickel and PGM supply contrasts sharply with automakers now targeting 50%+ EV sales mixes by 2030, enabled by major US policy incentives accelerating consumer adoption.

Strong Institutional Backing Plus Research Coverage: Leading mining investors including Eric Sprott and Glencore plus independent research coverage signals confidence in Palladium One’s experienced leadership team and growth story.

Conclusion & Key Takeaways

Palladium One Mining offers investors leverage to structural supply deficits looming for the very metals needed to address climate change. With funding secured for systematic exploration at two proven district-scale assets, the coming year could demonstrate substantial resource expansion potential. Attractive metals exposure via assets located in top mining jurisdictions position the company to eventually consolidate resources towards development decisions over the medium term.

As the energy transition accelerates, Palladium One’s portfolio of nickel, copper and key catalytic converter metals provides investors metals exposure well-aligned with massive emerging demand drivers. With much of this demand growth still in the early stages, disciplined exploration programs focused on resource definition offer upside for investors as future supply shortages become more acute. Leadership from an experienced technical and executive team highlight promising opportunities to monitor moving forward.