Well, a very good morning, everyone, and thanks very much for joining us. I am Nicholas Read from Read Corporate, and on behalf of Mont Royal Resources, ASX code MRZ and TSXV ticker MRZL, it is my great pleasure to host this shareholder and investor webinar. Today we are joined by Nick Holthouse, Mont Royal’s Managing Director, for what promises to be a compelling update following some important recent milestones for the company. Earlier this month, Mont Royal delivered an updated preliminary economic assessment study for its flagship Ashram project in Canada, highlighting a globally significant critical minerals asset with a 30-year mine life, robust economics, and the potential to become a strategically important North American supplier of rare earths and phosphate. This is the first major update since the Ashram asset, which is one of the largest rare earths development projects globally.
Came to the ASX late last year through the successful merger of Commerce Resources and Mont Royal. Beyond the PEA, the company is continuing to build momentum across a number of fronts, advancing downstream processing initiatives, strengthening partnerships, and progressing permitting and studies. Nick relocated to Montréal earlier this year to drive the development of Ashram, so we are very pleased to have him back in Perth for a while at least, to update investors on what is next with this exciting story. Rather than the conventional presentation page turn, Nick is going to talk through some of the key highlights from recent announcements, and then we are going to dive straight into Q&A. So we will refer to the slide pack that is in front of you. This is intended to be an interactive session.
For those of you who have tuned in, please use the Q&A tab on your browser to log your questions, and we will do our best to get to all of them. So let us get right into it. Nick, look, firstly, welcome. It is always great to see you. Thanks for joining us this morning.
Thanks very much, Nicholas, and great to be here again. It has been a while since we have done a webinar. There has been an awful lot happened, I think, since the last update we gave, which would have been back in November, I think. I think I was probably in Malaysia at a conference at the time. An awful lot has happened. So, very much looking forward to sharing some of those updates with the audience and looking forward to taking your questions. As I said, there are some major milestones that we have achieved very recently with this story. We are becoming much more visible with regards to government and industry now, and it is an exciting time for the project going forward. Yes, look forward to sharing that all with you.
Thanks, Nick. Well, look, I thought we might start firstly with the important announcement that came out earlier this month, which was the PEA. Rather than going through all the detail, I know you've got a few high-level slides that you can share with us, but maybe just step us through some of the key takeaways from that.
Yeah, sure. So wonderful. We'll dive into the slides first up, and then we'll probably talk a little bit about what the recent update today means, which is super exciting, too. I'm really pleased to see that pop up. It took us all a little bit by surprise. But look, some of the investment highlights from the study that have just come through. Bear in mind, too, I think the last PEA study was undertaken in 2012. So it was very much in line for a refresh. It's something that government has certainly been asking for. We do get a lot of government support, government eyes on this project, particularly now with this really positive study that's come out to market. Also industry. Industry has really been sort of milling around the gate, for want of a better word, with regards to wanting to engage with this project.
They have a broad understanding of the metrics. But now that we've completed this study, we can share some of these really important metrics with industry. I think we're really going to be drawing a lot of those groups into the light now and having some much more robust conversations about how we go forward. But just to refresh everyone's minds, with regards to what this story is. We're sitting on one of the largest carbonatite deposits in the North American space. That's super meaningful. There's been a lot of work done in the past. 204 million tonnes at around 1.9% TREO. This story remains open at depth.
Bear in mind too, that what we're looking at with this particular study, this stage one component of this study, only looks at around 25% of that 204 million tonnes. So this project has got an awful long way to go. It's got really long legs. It's got that ability to be scaled up to meet industry demand over time. We're well and truly set, I think, for the next 30 years with regards to taking the story forward. But along that journey, we can certainly scale up, as I mentioned before, to meet industry demands if those demands change. If they increase, we can very easily scale up to meet that. We're looking at making around 17,500 tonnes per annum of TREO. That's a really meaningful contribution. If you start breaking that down.
That will come out at an empty stage. It is a mixed rare earth concentrate or carbonate, as we call it. It is around 4,000 tonnes of NdPr a year. It is quite a significant chunk. Really importantly as well, we are looking at around 100 tonnes of DyTb that come along with that as well. This is not a heavy's mine, but what we do have, and this is the magic of this story, is the metallurgy works. We are starting off with a good resource. We are starting off with a good tenor of TREO. From that, we draw, we have a really good, what we call mass pull. We are able to pull a lot of metal on a per-tonne basis out of that feed that goes into the plant, and it is around 1.7 million tonnes a year working out of this stage to kick the story off.
At the end of the day, when we get through to the high demand stage, these are the sort of numbers we produce. 4,000 tonnes of NdPr, 100 tonnes of DyTb, super important in the magnet space going forward and very much desired by Western separators, the industry is going forward. It is a challenging element to get hold of. Both of those elements are. New kid on the block, and this is something that has been quite exciting, something we have never really considered before, is yttrium. I have not got yttrium on this. I have not shown it in this particular slide, but yttrium is becoming really important. We do probably do around 200 tons of yttrium a year, 230, I think, from memory, inside that mixed rare earth carbonate. Yttrium is super important in the aerospace industry.
Canada itself, Quebec, one of the third largest aerospace industry hubs in the world, which is something I have only just recently found out. The requirement for yttrium, always been considered a waste product in the past, is really coming to the fore. That has become a valuable contributor to the basket going forward. The same NPV8, 8% discount, around CAD 2 billion, super exciting post-tax. We know this thing works. The met works. We know that the way that we have reconfigured this project over the last 12 months, with regards to the logistics plan and the way that we have now brought it forward. We were hoping to save a considerable amount of capital. We have done that, and it was also deliver a project which is eminently operable as well. Myself coming from an operations background, this is of keen interest to me in particular.
We really want to make sure we deliver a robust project that can wash its face in challenging times. With the debt that we have got, we have got a very significant amount of return that comes along with this particular project. Average basket price around CAD 48 per kilo. That is, it is not U.S., it is Canadian. Our all-in sustaining cost around CAD 18.50, actually. It has got CAD 18 there. CAD 18.50. We have got a good amount of headspace there going forward with this story. Very important. Government support. Government support is really growing. We have had really pretty engagement over the past 12 months with the provincial government. We get along extremely well with those guys. We are getting lots of support from those guys, particularly around the capital infrastructure story that has keyed this project going forward.
But more recently, too, it is really starting to garner some interest from the federal government space as well. I have been meeting with those folks in Ottawa a couple of times now over the past few months. So that support at the federal level is certainly starting to build. One thing they have all been waiting for is this PEA study. They really wanted to see this PEA study come out so they can understand and measure up this project. And I think they were pleasantly surprised by what they are seeing with regards to the metrics coming through. There has been quite a bit of feedback over the last week. Government certainly like the story that they are seeing at the moment. So we will keep pushing that. CapEx. This is always a contentious point with these hard rock projects. But where we have settled is around CAD 1.2 billion with a 30% contingency.
If you take that away, we are sitting around over CAD 900 million. We are sitting within the bandwidth of what these projects cost. That initial capital cost does not include the road. I will talk a bit more about how we have treated the road costs in this study. We certainly captured the road costs. We have not ignored them. So the CAD 700 million or CAD 800 million that is required to, that has been estimated to build that access road down to Schefferville, which is our preferred access route now, to get more fuels to market. It is absolutely included in the story. It is included as an operating cost in this study. So I think there is a real opportunity for us to wind that out as well with further engagement with the government and that support that we are seeing from those guys in subsequent studies.
That is really going to just add to the, I guess, the importance and the flavor that we are seeing with regards to the value that this project can deliver. We wind that CAD 700 million out. It is really going to add to the bottom line. As I said before, we scale. This is stage one only. This is 30 years. If you extrapolate out that 1.7 million tons per year feed grade that we are looking at, it is 120-year mine life. I guess the anticipation is that over time, industry demands will increase, and the throughput for this mine will increase as well. Eminently scalable to be able to serve multiple customers. It does not just stop at rare earth elements. We have fluorspar and niobium as well as we go forward. So this is a multi-faceted project.
The fluorspar comes along with the rare earth elements in the main Ashram deposit. Surrounding the Ashram deposit, we have multiple niobium and fluorspar hits. Some of it is really elevated fluorspar grades. We are seeing around 5%- 6% within the deposit itself. Outside the deposit in the Mallard district, which is only 1.5 km away from the main Ashram deposit itself. We would have seen this in announced, we are seeing fluorspar grades of up to 30%, 35%. So that is super exciting as well. There are lots of strings to the bow here. At the moment, the focus really is on that rare earth element story, taking that forward. Secondarily, monetizing the fluorspar that comes along with those rare earth elements. I will just flick to the last stage here on the highlights.
I really want to focus on some Q&As and make sure we catch all the concerns of the audience out there. I am sure you have all read this document back to front. But again, highlighting on some of those findings from the PEA. CAD 2.3 billion post-tax NPV. Really strong metrics there. 22% IRR. Payback, theoretical payback in 3.9 years. Initial CapEx, CAD 1.2 billion. As I said before, these are big-ticket items. They are not cheap projects to build. But when you look at the resource base that we are sitting on, this is certainly justified. We are not here five years, 10 years, 15 years with this project. 30 years in stage one, with the ability to go to 120 without turning a rod again. Going back and drilling, looking further down dip. I will certainly be turning up more of those tonnes that are available.
Talking about tonnes as well, the BD-Zone, which is another announcement that came out a few months ago, really is an opportunity for us to grow the tenor of the resource. The BD-Zone shrouds the high-grade core that we are looking at, that 203 million tonnes, 204 million tonnes. We really think there is an opportunity there to turn that into a saleable concentrate as well. If that comes along, we are looking at a significantly larger resource than we have at the moment. Ore sustaining costs, these are really important. CAD 18.58, remembering that our current basket value sits at around CAD 43, CAD 44. These are special Canadian numbers, remember. So a good gap there, a nice breathable chunk of head space there for us to exist in and allow some of those price fluctuations coming forward. 17,500 tons of TREO and mine life of 30 years.
That is really the highlights, Nicholas, I guess, with regards to the story going forward. I think the other question you are alluding to is more around the recent announcement. Is that right?
Yes, that is right, Nick. I thought it would be good to touch on this morning's announcement. You were talking earlier about infrastructure and the importance of that.
You and other players have welcomed an initiative by the Naskapi Nation this morning. Perhaps you could tease out some of the significance of that for investors.
Yeah, absolutely. There are two key components to this story going forward that came when I jumped on board four months ago. One was the requirement to get some sort of technical assessment out, which really shows the, I guess, the opportunities for the Ashram deposit and how it can fit into an alternative supply chain story for the West. This PEA document has certainly done that, and it sort of exceeded my expectations. The ability or the amount that we have reduced the capital cost over the last four months. We have really slammed the capital cost down. We have done that through some, I guess, some smart thinking around logistics routes. That has allowed us to move the chess pieces around. The Saguenay story for hydromet is really important. Getting that hydromet facility off-site, getting into an industrial hub like Saguenay, super important. Very cheap power costs there.
It is a plug-and-play situation with regards to power, water, and gas. We are getting a lot of support from provincial government in particular, to locate into that area. They really are looking at Saguenay as becoming a critical minerals processing hub for lots of other industries as well. We are very pleased to be participating there. The combination of all those things, we have reduced CapEx, we have made this project much more operable, and we have come up with that all-important sustaining cost for a kilo of TREO. We have really got that into a comfortable zone now. The ability for us to reduce that further studies and some deeper thinking, I think is real as we go forward now into the pre-feasibility study. The logistics piece that comes around that, I guess that is what that announcement is really about today, and that is the second part of the story.
PEA, point one. Second point is how do we get molecules off-site? That has been something that we have been working very closely with government and First Nations groups on over the last 12 months. Today's announcement is super pleasing. What that really is indicating is that First Nations support, which is super important for governments to step onto, they will not move without us gathering that support from First Nations groups in this particular instance. I think this is a really important step with regards to taking that story forward. Very keen to take this logistics piece story forward. For their own purposes, they really want better access into their territories.
There's a couple of mining projects which they've handpicked, which they see as really good candidates for getting up and going forward and being a good, I guess, champion for their cause with regards to taking the story forward. We've been selected as one of those. Seeing that being officially announced on the Naskapi website a few days ago was really bright. We're really pleased to see that. It means those conversations are moving forward. They are becoming real and tangible. With that support from the First Nations group, it certainly becomes of a lot more interest to government groups to look at stepping on and supporting an infrastructure piece in this part of the world. This is not just at the provincial level. We're getting really good support from Investissement Québec, the MRNF , and also a group called Société du Plan Nord.
Three key government groups which are looking to open up access to this all-important northern Québec space that we are looking to operate in. At the federal level, we've had really meaningful conversations with the Prime Minister's Office, Department of Defense, Department of Transport , the Ministry of Economy, and NRCan. Sorry. I may have just escaped you for a second there. But really important federal government groups that really want to see these projects go forward. It's not just about us getting a road built for us. That's certainly not the case. This is the First Nations groups indicating that they want federal funds to go forward and look at opportunities for opening up their own territories for their own benefits. With us being the secondary benefit to that conversation being that it opens up access for mining companies as well.
We're certainly pleased to be in that space and working with these groups to take that story forward. That's really where that announcement sort of sits, Nicholas. It's super exciting for me. There's been an awful lot of work that's gone on in the background, and it's culminating in, we hope, some very interesting and exciting announcements in the very near future around support for this infrastructure story going forward, a consortium of sorts that goes forward and obviously government for funds to go build these roads. A PEA in place. This road story is really starting to crystallize with regards to government support. Those two key elements are what we said that we needed to go out and solve at the start of this process. PEA has been knocked over, great results there.
The next thing is getting this government support for an infrastructure piece around the road put there, and I think we're getting very close to that now. This announcement is a very solid step forward with regards to that whole story.
Mm. That's fantastic, Nick. We've got a lot of questions. I see they're coming through online here as well. But before I get into some of those, a lot of shareholders and investors have asked about the share price over the last couple of weeks. Obviously, the PEA landed in a week of extreme volatility before the Iran conflict has since been resolved. Has that been the main factor, do you think, or have there been other factors? I suppose it's fair to ask, what has the feedback been more broadly on the PEA, both from investors and other stakeholders?
It's a great question, Nicholas, and it's been really hard to put a finger on, to be honest. Some people have sort of intimated that they think that the price tag isn't perhaps correct. That's a valid point. Price tags are price tags. One thing you can guarantee with any price tag, in any commodity, is that for nearly 100% of the time, it's going to be wrong. Those forecasts are forecasts. There's a whole bunch of moving parts that feed into those matrices which build up those forecasts. We use a group called Adamas . Adamas are absolutely well-known and well-regarded in the critical metal space with regards to price forecasting. The deck that we have used is really focused on a non-China route, and I think that's an absolute valid approach to take going forward. The non-Chinese decks are fairly new.
There's what they call a CIF U.S. deck, which has popped out, and a few of those forecasters are starting to develop those decks. There's enough sales outside China now, which can support those price tags and the metrics and what we're seeing in the downstream space to build out those ecosystems for industry to use those molecules outside of China is real. That is starting to grow. There's a lot of commitments that are being made in that space. So a U.S. pricing deck. What we've gone for is a European pricing deck. We really see a strong connection with Europe going forward. I think there's a lot of opportunities in Europe as well as the U.S. as well. But in this case, we've chosen the European deck. They're quite similar.
What it is really demonstrating is, and this is something that we have been really pushing for in the industry for quite some time now. We need to get away from that very opaque Chinese pricing story, which we have all been sort of living and dying by. We have been heavily manipulated by, unfortunately. Projects have really suffered in that sense. There has been lots of projects which have come quite close to the financing point and have been manipulated, I guess, out of that ability to get to that last stage and get built because of that strong influence that we see coming out of China and their ability to control the market. That, I think we are well on the way to seeing a bifurcation in that story.
On top of that as well, you have the CAD 110 floor price which is becoming, t here is a couple of businesses which have availed in that in the U.S. space and more recently, Lynas in Japan. So CAD 110 as a floor price story absolutely suits us as well. We would be quite happy living with a floor price, a minimum price of CAD 110. That absolutely works for us and then sharing in some upside as well. So that, the deck that we have chosen, it is not the upper case, it is not the lower case. We have sort of gone for the middle of the road in that CIF pricing deck. I think that is completely justifiable in this case. When we get to the next stage of work, the PFS, there will be a new price deck. Okay.
Very likely that it will probably stick with the European format with regards to pricing. Very likely we will probably stick with the base case again, but who knows what those numbers are going to look like in nine or 12 months when we get to that stage, Nicholas.
Excellent, Nick. Thanks very much. Let us get through these questions. A few investors have asked, does the company plan to issue flow-through shares in Canada this year?
No, unfortunately. Flow-through is a really interesting concept in Canada. Flow-through at the moment is unfortunately just restricted to exploration activities. We don't see ourselves doing any exploration activities over the next 12 months. Not saying that next year we don't. We may look at potentially doing some additional drilling next year, but that decision hasn't yet been made. So the potential for some flow-through there is possible. What we are really, w e're working with some lobby groups that are very keen on pushing for extending the boundaries of flow-through to cover environmental permitting, metallurgical studies, and engineering studies as well. That's where it gets really exciting for us, I think, in the space we're in. We're really not in that exploration space anymore. It's really about a development phase for us.
If we could secure, if they do get that legislation changed, I think there's another review for that towards the end of this year. If that does change, that would certainly be of interest to us to go and raise some funds under that flow-through story because it would be completely applicable and would fit our development profile going forward.
Okay. Thanks, Nick. I have an investor that notes here that your flow sheet proposes the production of a mixed rare earth concentrate, which sits further downstream than a lot of other peers. If you were to produce a concentrate instead, what's your gut feel on the potential reduction in CapEx?
That's a great question. It's certainly something we have been looking at from day one. We've always sort of said that we're open to those sort of options. It's really about finding the right sort of industry partner. I guess, as a thumbs up, I'm just mentally flicking through the capital cost numbers here. We'll probably see our capital cost with contingency come down to something in the order of CAD 700 million- CAD 800 million today, I would think, by dropping out the entire Saguenay hydromet story. So that's what we're looking at, CAD 500 million with contingency by removing that. But again, it really comes down to partnerships. Who would we sell that product to? There are some industry players that are certainly interested in looking at accepting a concentrate only and doing a hydromet processing themselves or potentially in a JV type arrangement.
All these things are opportunities that we will be looking at as we keep going forward. We have got a few months now through to the end of the year. Certainly, our kicking off the pre-feasibility study in full swing off the back of this study. We have got a little bit of work to do, and we have got some real opportunities here to go and shop this PEA around and see what sort of interest we can get from industry and government, in regards to how we go forward, particularly in some sort of non-dilutive funding approach. I think this story really crystallizes the opportunity for Ashram, along with what we are seeing happening in the road space as well. That is really starting to move forward. There has been the announcement that you saw come out this morning. I cannot stress how important that acknowledgement from the First Nations groups is.
It is a real positive step forward. For us now to start looking at some of these industry players and looking at how they can potentially participate in some non-dilutive way with helping us take that story forward is really important. I think to go back to the gist of the initial question, absolutely. Going to a concentrate on this story is something we can certainly entertain. Payability is somewhere between 30% and 40%. We just need to understand how that sits within our profile. But as long as we can sort of maintain that IRR, I guess that is really where we need to try and play. If we get somewhere between 30% and 40% payability on a concentrate, 40% might be a stretch. 30% is probably eminently achievable. The truth probably lies in between.
And seeing where that sits with an IRR, we really want to try and maintain that something above 20% if we can. If it does that, then we could certainly look at that as an opportunity.
Thanks, Nick. That is a great answer on the product there. I just wanted to throw this question in here. That was a great question that was emailed in about offtake. Just to flesh that out a bit more.
Sure.
The question was, "Can you describe what the likely customer base for Ashram's planned product actually looks like? Are there existing Western processors , magnet manufacturers, OEMs, or government-backed entities that could consume Ashram-produced material at commercial scale? And how advanced are those discussions?
Great question. Look, it's chicken and egg sort of stuff. As I said before, there's a couple of key things we need to get in place before we can sort of bring a lot of those groups in from the shadows into the light, which is starting to happen now. We're getting some really positive feedback from industry that we have been talking. We've been talking to lots of groups in the industry, lots of groups in the U.S., lots of groups in Europe in particular. All these folks are looking for molecules. Some are looking for material to separate. Some are looking for magnets. It's a growing story. The whole ecosystem that's required to get from a separated oxide, for instance, or a mixture of carbonate through to a magnet.
It's a very different space than where it was over nine years ago when I first started in this industry. We were faced with the same sorts of questions and the same sorts of challenges. Very tough back then. It's certainly becoming easier in that space. There's some green shoots around that midstream processing and downstream processing area. I think there's real opportunity in Europe. We certainly are looking very closely at some opportunities in Europe. I've just been through Europe on a trade mission with Investissement Québec. It was a fascinating trip into Germany, France, and into Belgium as well. Certainly getting a lot of interest from industry groups there in regards to securing molecules in various forms. Look, there's nothing concrete in place at this stage.
We now have the document in hand that we can actually go back to these groups and start having some more robust conversations about how we go forward and how they can participate as well. As I said, non-dilutive equity in our story going forward is square prize. I think we've got some real opportunities now in attracting some cornerstone investment around from some of these groups, some of these larger groups going forward. But we really needed to demonstrate to them what the metrics of the Ashram project look like. I think we've done that now. I think there's a lot you can do to improve those metrics as well going forward. But those conversations, I think we're in a good space.
So there's a parallel question here, Nick, from the same investor on funding, financing, and you're probably going to say the same thing about the importance of the PEA document. But he says that, understanding the various sources from where capital can be raised, given the CapEx requirement, what he's interested in is just some commentary around the specific sources of capital that you see coming into the mix. Is it commercial lenders, government agencies, OEMs, strategic partners, ECAs, or I guess, all of the above? And what discussions are already underway on that front?
Yeah. Well, I guess the short answer to that is all of the above. That is the traditional mix for these projects. They have not been easy to finance in the past, and that's been a real challenge. Government support is key in taking these stories forward. Commercial lending is tough. Commercial lenders typically do not want to play in this space. However, there's a couple of things that have changed recently which may change that view. I don't think it's, as far as I know, I haven't heard of any commercial lenders stepping into the space to debt fund projects like this. But the addition of a floor price, maybe that's a catalyst for these groups to take a step closer and look at potentially funding these. If we can guarantee a floor price on projects like Ashram, then I think it becomes of more interest to commercial lenders.
But at the moment, it's the classic case of debt financing, typically from government firms. We're certainly talking to those folks in Canada, and in Europe, at this stage. Not so much in Australia, but those conversations will come, I think. And I'm sure you readers can work out who those groups are. There are government groups which will support in that space with regards to debt financing. We are very much looking to industry for support around cornerstoning that non-dilutive sort of funding approach, with regards to equity. Going forward, ECAs, absolutely. ECAs, it's a little early to engage with ECAs at this stage. We really need to be a little sharper on what our, things like our mechanical equipment list looks like. That's typically where that funding comes from. Once we understand that to a higher level, then we can probably start engaging with those groups.
Towards the end of the PFS, it's probably a good time to start having those conversations. Certainly not on a PEA level. We have not identified any specific equipment groups or countries where that equipment will come from at this stage, which will drive those conversations. But it's a real mix. I think, in a short answer, all of the above would help fund that mix. Again, this PEA document is what we'd need to sort of really start having those deeper conversations around that. But we've got that now, and we can advance through that door into that next room and start getting a little bit more meaningful with those discussions.
Excellent. Thanks, Nick. An investor has just asked online here if the CapEx outlined in the PEA, the CAD 1.23 billion, excludes the road development component. How do you plan to fund that aspect of the project, and are you talking to any strategic partners on that front?
Sorry, you're talking, you're talking about the road component?
The road, yeah.
Well, at the moment, the plan is that, the ultimate plan is that government comes in and builds this as a piece of national infrastructure, because I said before, this is something that the First Nations groups are looking to government to fund. At the moment, we have a grant from the CMIF which is run under the NRCan, for CAD 2.6 million. That's to go towards road studies looking south into Ashram and Schefferville. So we're just working through the DD component of that. We're expecting, I think all our documentation went into that grant around two months ago, six weeks ago, perhaps. No feedback yet at this stage, which is a good sign I think. So we're getting reasonably close, I think, to getting some sort of firm commitment from government for that CAD 2.6 million.
Now, that will go into, if there's some sort of consortium that comes together to take this story forward, mining groups and First Nations groups, we would look at putting that money into that consortium. It would be focused on our access route only. Other mining groups will have their own interests with regards to access routes as well, with the First Nations groups really controlling how that road, I guess that road network folds out. But that CAD 2.6 million would certainly go into that to kick that process off. For us, really, first step in a road access story would be understanding what is an agreeable alignment between Ashram and the Schefferville First Nations groups from an information point comfortable where that road alignment sits. That's step one.
Then step two, we start looking at, so once that alignment has been settled, really start looking at some of the engineering that goes into that and the permitting process. But our expectation is that at some stage, with that government commitment, those processes will be taken off us, and it becomes a government-funded story in its entirety, from permitting design right through to construction as well.
Excellent. Thanks, Nick. Probably a good opportunity just to sort of tease out from you a bit more, I guess, the what next question here, and also just the company's funding position. You mentioned the road grant coming in. You're well-funded cash-wise. What happens next in terms of, and how do you sort of transition into that PFS phase? Can you sort of talk us through that process?
Yeah, absolutely. We certainly aren't interested in barreling headlong into a full-blown PFS. We've still got a reasonable treasury sitting with us at the moment. I think we're sitting around the CAD 5 million mark, with regards to funds with another CAD 2.6 million, which is just taking its time to come back in. But that's a rebate from flow-through from a couple of years ago, actually. That's been granted. We're just waiting for that. So those funds to hit our bank account. So I think, we've got a reasonable amount of money to sit on for the next while. We certainly don't need to be going chasing any more funds this year.
As I said before, it is really about using this document now and starting to work in a much more meaningful way with industry groups and looking at bringing them to the table, showing them the opportunity, demonstrating the opportunity for this project, and having those deeper conversations and trying to attract that non-dilutive capital into this story now. I think that is the real opportunity for us. That is really where our focus is for the remainder of this year and probably the early part of next year. There are a few bits and pieces we will be kicking off. We have got a little bit of work with ANSTO coming up, which is going to be really interesting, looking at potential for a mixture of oxide as opposed to a mixture of carbonate, for instance. I think these are just trade-offs as we go into the pre-feasibility study stage.
There is a little bit of permitting that we are going to kick off. We made some really solid gains on the capital cost of the tailings dam on site, for instance. It is just through shuffling that around. We do need to go back and do a little bit of baseline work around that just to cover that area. We will go and get that knocked off as well. That will set us up for a good launch into a full-blown permitting process in the early part of next year, along with the PFS as well. A couple of smaller trade-off studies, particularly on the rare earth side. Fluorspar is a big part of that. We really want to try and make sure we do enough work to get fluorspar into the pre-feasibility study when we table that at the end of next.
We are still planning on covering that by the end of next year. We really want fluorspar to be a part of that. Fluorspar is going to be a big driver. My back of the cigarette packet calculations are telling me that it is somewhere between 8% and 10%, but that is an absolute welcome addition to any flow stream. The fact that it is sitting there, the fact that it bypasses through the process and essentially transitions to the tailings dam as a waste product. There is a real opportunity there for us to go and monetize that and add that to the financial model going forward. So super keen to do that. Valorizing waste streams in Canada is a huge deal.
There is a lot of money floating around for those sorts of studies, so there is a good chance we will get the, I think, the [inaudible] to come and do that work, particularly around in the fluorspar space. So looking forward to kicking that off. But really, as I said before, it is really about leveraging what we have achieved here with this PEA, sorry, and working with industry groups to get to that next level of commitment from those guys and seeing who we can attract to the table in a more meaningful way. We have got a few services floating around in the weeds that have been waiting for this document. We are really pleased to start working more closely with them with it.
You mentioned fluorspar, Nick. I might just quickly stop you on that because we are hearing a lot about fluorspar on other ASX companies been doing, trading rather well on the back of fluorspar projects. What is fluorspar? Can you just for the benefit of those that may not know, what is it? What is it used for and why is it such a hot topic at the moment?
Yeah, sure. CaF2. I am fairly new to this story as well. I have to admit, it is not something that has ever been on my radar previously. But it is an important industrial mineral. It is used, I guess, for us in the first sense. There are two grades of fluorspar. There is what we call a metspar product, which is around 65% CaF2, which is what we are looking to produce initially on site at Ashram, just through flotation, simple flotation. Then you have got an acid grade or an acidspar product, which is around 96%, 97% CaF2. Now, we have produced that before through a slightly different flow stream, but we know that we can produce it.
That announcement went out, just on some of that previous work which had been done four or five years ago, maybe less than that, three or four years ago, I think, on producing an acidspar product. That went out to market again, just recently. So we know we can produce it. We have demonstrated that. But for us, I think first cab off the rank is really producing what we call a metspar product. It is a lower grade, 65% CaF2 product. Used a lot within Québec itself. It is around 150,000-200,000 tons a year is used in Saguenay, of all places. So right next door to where we are looking to do our secondary processing for our rare earths elements. Do our hydrogen plant. Saguenay uses around 150,000 tons a year in three of their aluminum smelters. There are three that I know of.
There could be others in that region. Why aluminum smelters in Québec when they do not have bauxite resources? Because it is a cheap place to run those electric arc furnaces. The green cheap hydropower there is CAD 0.05-CAD 0.06 a kilowatt hour. So a lot of bauxite is imported into Saguenay. It is smelted. The CaF2, the metspar product that we have is a flux that reduces cracking, I think, in the final product, the product that they produce. But it also lowers the melting temperature, I believe. So they use that. All that product comes out of China, maybe a little bit out of Mexico at this stage. So we see a real opportunity right on our doorstep to sell a fluorspar product. But going further into what they call an acidspar product. The acidspar product is used in all sorts of pharmaceuticals, chemical applications, refrigerants.
It is used in the food industry. But the ability to produce that is real as well. But as I said before, first stage, I think we get to [audio distortion]
Thanks, Nick. We will do a couple of quick ones here before we start to wrap things up, because we could talk all day here, couldn't we?
That is your fault.
The investor says you quote NdPr and NdPr floor price, but you do not have separated oxide to sell. Is that correct?
Yeah, that's right. At this stage of the study, the study stops at the hydromet stage . We produce what we call mixed rare earth carbonate. It's around 55% type of rare earth oxides inside that carbonate or that secondary concentrate. Within that 55% is the breakdown, that basket breakdown of all the elements. Those numbers that I've quoted before, 17,500 tonnes of TREO or metal, which contains all 15 elements. Amongst that 17,500, we've got 4,000 tonnes of neodymium-praseodymium , around 100 tonnes of dysprosium and terbium . As I said, new kid on the block, around 230 tonnes I believe, 250, 230, somewhere around there, of yttrium that comes on as well. They're really those five components really.
Of that 17,500 tonnes, you're looking at, say, 4,000, 4,200 tonnes of material there. That accounts for around 95%, 96% of the value of that 17,500 tonnes. Those five elements alone. 30% of the value of the listed elements account for around 95%, 96% of the value of those elements for that total rare earth oxide basket.
Excellent. Thanks, Nick. There's a specific question here. What catalysts can we look forward to in the next few months?
I think we've already sort of hashed over that. It's really more of a deeper dive into the study. The road is super important. As I said today's announcement, I know it's hard for folks, particularly outside of Canada, to really appreciate the value of that announcement. But it's a massive step forward. The fact that this is being led by First Nations groups is really quite unheard of within Canada itself. There's a lot of surprise. When people talk about this, it'll be a big deal over in Canada, not so much of a big deal over here, I'm sure. But rest assured, it is very much a positive step forward in the whole road story going forward.
As I say, government are very much keen to jump on board, but they needed that First Nations endorsement to do that, and this is the first part of that endorsement.
Thanks, Nick. We might sort of wrap up with a couple of really big-picture questions just to give people the big-picture forward outlook for MRZ and the value proposition here. Firstly, I did want to ask you, on the ASX, we hear a lot about Brazilian rare earth projects.
I know you have some experience of that sector as well. How do you compare Ashram and what you have here to some of those projects in terms of some of the key metrics? I guess where I'm getting to with that is why is this asset, given its location and what you have in front of you, what are the real advantages of Ashram?
Yeah, sure. That can be an enormous question in its own right, Nicholas. The immediate differences are really the, I guess, the processing flow sheets. So, in Brazil, they are predominantly clays that we're looking at. [VRE] might be a different story. That's certainly shaping up to be a hard rock story. But most of the stories that are getting the airplay are really in the clays space. Clays are good if you get the grades right. And there's a couple of projects which sit within some high-grade clay areas. So they've got a real opportunity going forward. The problem with, or the challenges around some of those projects is really at the back end, is how do you put that back together? You take the clay product, you need to mine quite a bit of it.
You slurry it, and then you need to stick it back together into a Because they're all going away from TSF-type flow sheets. No one wants to build tailings dams in Brazil. And that's a fair call. So getting the material back into a state where you can dry stack it is certainly a challenge. I think that's going to be the bigger challenge of all these projects going forward. Not saying it's not possible and they won't achieve it, but it's certainly a challenge going forward. Where we are different, we are in the hard rock space. So yeah, we have a very different flow sheet in that sense. But it's really about who we connect with. I think those Brazilian projects are really very much focused on engaging in the U.S. space. With the exception of VMM , I believe.
They've just done a deal with Solvay, which is good to see. But for us, we really are very much looking to Europe. Certainly looking to the U.S. as well, but I think Europe is a real opportunity for us going forward in regards to those sorts of relationships. But very different projects. It's hard to summarize them in a short space of time, Nicholas. But we have different markets. I think ultimately, we certainly have different flow sheets. We have a different cost profile. But Ashram is interesting in the sense that we have a good grade profile, a really strong metallurgy. We produce a lot of metal on a per tonne basis. It's around 12 kilos of TREO per tonne of material that we put through the front end. We'll see that realized in the mixed rare earth carbonate as a separable product.
So that's a real advantage, and that really puts this project. We're not the cheapest hard rock project out there, but we're certainly sitting within the bandwidth. The opportunity for us now is to really sort of drive those costs down [audio distortion]
Thanks, Nick. That's great. Just one final one to sort of bring us home. We had some great questions emailed in, by the way, which I've sort of weaved in here. But investors sort of asked, given the strategic significance of this project, and there's no doubt, I think everyone can see that in terms of jurisdiction and scale, can you identify a credible customer and financing pathway, given the scale and the significance of the asset? Also, how do you see big picture, how do MRZ shareholders win out of that process, given all the pieces of the jigsaw that need to come together?
Yeah, sure. Look, I think we've touched on parts of that question already. Look, I think the interest of the Ashram story is in its, it's not just the scale. The scale is important. There's the ability for industry to couple up with a company or with a group like Ashram, a deposit like Ashram, which is going to be around for an awful long time. This is a multi-generational proposition. It's not going to be around for 15, 20 years, before we run out of resources. We are going to be around for an awful long time. So the ability to become a steady-state producer is of interest to the larger industry groups downstream. I think that's the real advantage here.
The other important thing is that we don't intend to be a project which is going to be living on the margins and is reliant on government support to go forward. The road infrastructure piece is important. Once that is in place, then this is a project which certainly works in this space quite easily. So for us, it's about delivering a project which is robust, has the best, I guess, margin in the already sustainable operating space that we can possibly deliver. I think we've got the right sort of project to do that. So delivering a strong, independent project which is going to be around for an awful long time, I think is really the attraction for this story. I think that is what attracts and the ability to scale up as well.
We can service multiple partners in stage one, but by increasing throughput on-site, which is quite easy for us to do. We have a very low strip ratio. It's 0.3, 0.4:1 . So our upfront costs, our mining costs are very low. It's a very small pit that we're talking about when we take forward. It's not an enormous mining operation by any sense. So all those things I think feed into a very sustainable and well-managed and scalable project, which is appealing to the industry.
Fantastic, Nick. Well, look, on that note, I think we've done our best to cover most of the topics, and I think we've done that pretty comprehensively. If we missed anything, I'm sure you'd be happy to take questions offline.
For sure.
Maybe just a couple of final notes before we wrap up.
I know it's been a challenging time in the market over the past few weeks, but I think when you look at the metrics of this project going forward, I think the PEA that we've delivered, this is a really robust story in the rare earth space. I think where we sit geographically in that Québec space, we're just sitting above the more important market in the U.S. close to those industries in Europe as well. The fact that we're getting a lot of support now from government, I think this project is well and truly off to the races in that sense. We are grossly undervalued at this stage, and that is really the opportunity going forward. Get on board.
Well said. Look, thanks very much, Nick. It is always great to chat to you, and we appreciate your time this morning. Thank you to everyone for tuning in. We had some great questions and some great engagement, so we do appreciate it. We will release a recording of this webinar on the company's socials and website later today. We appreciate your time and your interest in Mont Royal, and no doubt we will be getting Nick back later this year to give us some further updates. We wish everyone a great day, and thank you very much for your time.
Thanks very much, Nicholas, and thanks for the opportunity.