NioCorp Developments Ltd
CEO: Mark Smith
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WSA: Good day from Wall Street. This is Juan Costello, senior analyst at the Wall Street Analyzer. Joining us today are Mark Smith, CEO of Niocorp Developments Ltd., as well as the company’s VP of Investor Relations, Teresa McGowan. The company trades on the Toronto Stock Exchange, ticker symbol NB, as well as on the OTCQX, ticker symbol NIOBF. Thanks for joining us today there.
Mark: It’s our pleasure, Juan. Thank you for having us.
WSA: Great. So starting off, please give us a history and overview of the company for some of our listeners that are new to your story.
Mark: Niocorp is a resource company. We are in the early development stages. We have the second largest and third richest niobium resource known in the world. The project is located in the southeast corner of Nebraska and we’ve now completed our preliminary economic analysis and we’re moving full speed into our feasibility study. So what we’re trying to do is to continue to develop the project, reduce the normal risks that are associated with resource projects, and move the effort as fast as possible into production.
WSA: Certainly. Can you provide us an overview of the Elk Creek project once again for some of our listeners that did not catch our last interview from about 5 months ago and give us an update?
WSA: You bet, Juan. As I mentioned we completed our PEA, but there are some other things that happened during the calendar year 2014, which became news in early 2015, which has occurred since our last interview. Things like during calendar year 2014 Niocorp’s stock price increased by over 400%. Niocorp was also named in the 2014 TSX Venture 50 and we were the top mining sector performing company. We also graduated from the TSX Venture Exchange to the full big board TSX on March 9th and then we of course issued our PEA result in mid-April. So it’s been a very busy time, a very busy first half of the year already, and we’re continuing with our very aggressive state to develop this project and we don’t see anything that will slow us down.
WSA: Great and so what key trends are you focused on right now in this sector and how is the company position to capitalize?
Mark: You know niobium is a very unique mineral. There are only three producers of niobium in the world today. I have every confidence in the world that Niocorp will be the fourth producer in the world, but the uses and demand for niobium continue to grow, and I think there is an excellent opportunity for Niocorp to come in as a supplier and start to fill some of the demand needs. I think we’re also uniquely situated because we’re located in the United States. Of the three producers of niobium in the world, two of them are in Brazil and one is in Canada. So if you’re not located in Brazil or Canada then niobium, almost by definition, is a strategically critical mineral. So Niocorp will play the role of being a US producer and again, we look forward to being the fourth producer of niobium in the world.
WSA: And can you talk about some of the recent management shifts that you had there and the new [Niocorp] corporate headquarters?
Mark: Yes, we have made some management changes. Peter Dickie who has been with the company for probably about five years has elected to retire and, in doing so, I have assumed the CEO and president role for the company. We still have one vacant seat on our board of directors with Peter’s departure, but with his departure, we’ve also elected to close down our Vancouver office and we’ve moved our headquarters to Denver, Colorado. And that is where the entire team sits now, in the Denver office, so I think that we’ll see a higher level of efficiency and obviously lower overhead costs as a result. Overall, it doesn’t really change the project that much, but it does make the company a little more efficient.
WSA: Certainly, and what are some of the key factors that you feel make Niocorp unique from some of the other players in the sector?
Mark: Well one of the things that of course makes this unique is the fact that we have a major niobium resource in the ground and its uniqueness includes a very high-core grade and a very large resource. So that a very good position and a very unique position that we’re in right now, but in addition to the niobium in the resource, we also have very good levels of titanium and scandium. Titanium is a very well-known mineral, it’s used in the metal industry and in the paint industry very large markets for that and we will be able to produce our titanium and introduce it into the market. Then probably not capture a lot of the attention as a result of that being a relatively small producer in a big market but the really exciting news here in addition to the niobium is the scandium. Scandium is a relatively rare element and this will be the largest producing asset known when it comes to scandium.
And when you think about scandium and its uses, it’s got a lot of similarities to niobium in that as niobium is to steel, scandium is to aluminum. So it can actually make the aluminum stronger, it can make it lighter, and most importantly, it makes the aluminum weldable, which means if there is a good enough and a reliable enough supply of scandium, it can actually be very beneficial in industries like the airline industry, where right now they have to use rivets to put the plane together and if they can weld the aluminum rather than rivet it, that goes a long way towards increasing the strength and aerodynamics of the airplane. So some pretty exciting news on that front and when we combine the titanium and the scandium and apply that as credit to the niobium production, we actually end up being, we think, probably in either the top position or certainly in the top two positions in terms of being a low-cost producer of niobium. So lots of good, exciting news on that front and we’ll continue to develop all the metallurgy required to produce all three of those elements.
WSA: Good. And what are some of the key trends and the goals and milestones that you’re hoping to accomplish over the course of the next six or twelve months?Mark: I think the most important thing in front of us right now is to finish up our feasibility study and we are still looking at our third quarter time frame for that effort. That will be a culmination of about a year and a half of very aggressive hard work to put all the resource information together, put all the metallurgy information together, put all the environmental and social information together for the project and issue that feasibility study. Immediately following the issuance of the feasibility study, we’ll get into the project financing, where we’ll finalize our debt and equity raises, so that we can start construction. Our goal is to finish that in late 2015 or early 2016. And immediately on the heels of doing the financing, to get into project construction. We anticipate about an 18 to 24-month construction period and then we start production. So time is running fast but we’ve got very good plans, very good people that are involved in executing all of these plans and things continue to go, I think, exceptionally well and we’re, as a general rule, meeting all of the timelines that we have suggested.
WSA: Certainly. And as you had mentioned at the top you recently joined the OTCQX top 50. Is there anything you still wish investors better understood about the company?
Mark: Well, I look at Niocorp as being a pretty simple decision on where to go. If you get money that you want to put in the resource industry, this is a good company to get into. We have all of the ingredients for a very good recipe here for success. We have an outstanding resource, we know our metallurgy very well at this point in time, and we have a very strong team of committed, passionate, and honest people. When you put those combinations of things together – good resource, good metallurgy, good people – I have yet to find in the resource industry that does not result in success. So that’s what I think people ought to get focused on and to the extent that we can help them, we are here to answer any of their questions and make our information available, but I think that’s what the investment community needs to know.
WSA: And before we conclude here, Mark, why do you believe investors should consider the company as a good investment opportunity today?
Mark: Well I think it goes right back to the answer to the last question, Juan, and that is it’s just an outstanding resource. It’s the second largest and the third richest for niobium in the world. We have known metallurgy, we’re not developing any new metallurgical processes. These are all well-known systems that are just put into the right order to make the metallurgy work for this mineral and we have outstanding people and we are going to continue to add to our team over the next few months as we get past the feasibility study and start getting into construction and what the investors can count on is that we will continue to hire the best people available for the resource industry and we’re pretty proud of the ones we have already.
WSA: Well we certainly look forward to continue to track the company’s growth and report on your upcoming progress. We’d like to thank you guys for taking your time to join us today and update our investor audience on Niocorp. It’s always good to have you on.
Mark: Well thank you Juan. It’s our pleasure to be here and we’re pretty excited about our future, so thanks for giving us the opportunity.