Well, good afternoon, everyone. Thanks very much indeed for joining us on behalf of Mont Royal Resources. Thanks for joining us for this first investor and shareholder webinar following the company's highly successful relisting on the ASX yesterday. I'm Nicholas Read from Read Corporate, and it's my great pleasure to introduce Mont Royal's new Managing Director, Nick Holthouse, who joins us from Malaysia. He's at a rare earths conference over there, and he's en route to Montreal, Canada. Mont's Head of Corporate Development, Peter Ruse, was going to join us as well from London, but he's had to head to hospital for the birth of his second child, so I think he's got a pretty good excuse.
Well, it's been a transformational period for Mont Royal, culminating in its successful merger with Commerce Resources, a transaction that brings one of North America's largest rare earths deposits, the Ashram project in Quebec, onto the ASX. With more than CAD 50 million of historical investment, Ashram is without doubt a tier one asset, and it's poised to play a key role in building new Western supply chains for the critical minerals that are driving the global energy transition. Mont Royal's relisting comes against the backdrop of some significant tailwinds for critical minerals and rare earths in particular, and that's why we're really pleased to have Nick with us today.
He's a real expert in the rare earths space, and he's going to step us through the company's new investor presentation outlining Mont Royal's strategy, upcoming milestones, and how the team plans to unlock the full value of this exceptional Canadian asset. Before we get into it, a quick reminder that this is intended to be an interactive session. So to all of those who are listening in, if you'd like to ask a question, please use the Q and A tab that's on your webinar browser to log your question, and I'll be sure that we cover all of the issues raised before we finish up. Nick, it's great to see you. Thanks very much for joining us. Congratulations on the listing, and please take us through the Mont Royal story.
Thanks very much for that very warm welcome, Nicholas, and welcome everyone that's jumped on. I can't see how many attendees we have, but let's walk through this very exciting story, which we've just managed to kick off in the last day or so. The obligatory disclaimer, I'll take that as read. The investment overview. Look, I'm sure a lot of you have heard this story before, but we are absolutely sitting on one of North America's most unique assets, I think, in the rare earths space. I've been in the rare earth game for about eight years now. First four years with Hastings Technology Metals, so a very similar flow sheet to what we're going to see with the Ashram project. Then three years as CEO of Meteoric Resources. Very different flow sheet. But again, a clay project in Brazil.
Really took that project from, I think I was employee number two in that instance, and took it up to a team of about 60 or 70 that it is now. Stepping out and into this opportunity, which was offered to me by Jeremy Robinson about five months ago. I have to admit, I was a bit taken back when Jeremy first spoke to me about the Ashram project. I thought I'd seen them all. Very keen interest in rare earths. It's been an absolute game. I guess, it's reinvigorated my interest in the resources sector. There's nothing more fascinating than the rare earths space in the mineral resources sector. I've been a mining engineer since, and been in the mining industry since the late 1980s. A really strong focus on operations. More recently in projects and then more recently again into management roles.
Stepping into the rare earths space has been fascinating. It's really engaged me. As being a strong devotee, I thought I'd seen all the projects on the planet until Ashram was introduced to me, and it's been around for quite some time. Not only the scale of this project is of interest, but it's the most important thing for me, and the thing that really sunk the hook was the fact that the metallurgy works. There's a lot of great headline stories out there in the rare earths space. People talk about really exciting headline TREO grades. They talk about really exciting baskets. That doesn't really translate to an economic story, and this certainly is. We've got a great headline grade. But it translates in that all-important first flow sheet step, that flotation step, into a really good quality monazite concentrate.
We get around that 37% con. That's really exciting. That's almost a saleable product in its own right. In fact, it could be. That gives us options. This is what really drew me into this project. The fact that it's also in Quebec. Quebec's shaping up for me to be a really interesting place to do business. I've never worked in Canada before. But the support that we're seeing in that government space, in particular, is enormous. I think with the current geopolitical tailwinds that we have at the moment, there has never been a better time to try and work in this space. Certainly not my last eight years. With that geopolitical support and a good quality project, I think it's a great time to try and launch a project like this.
Getting that government assistance, not only from the provincial level, but also from at the federal level in Canada, is absolutely real. We've also got the U.S. down to the south. We do have connections through the U.S. government for support as well. But I think the way things are shaping up, I think any support coming out of other governments, whether it be Europe, the U.S., or even Australia, I think the Canadian support is really going to eclipse that, and that's something we need to take advantage of. Really excited to be working in Quebec. Really exciting to be building those relationships with the Quebec government and also at the federal level in Canada as we go forward. We've got a new leadership team. We've got a new board. The old board has gone. The old exploration look and feel for the story is going.
As I said, this has been around for 10 or 15 years. There's been an awful lot of drilling done, hence such a large resource that we have with us now. That exploration approach is drifting off. We're changing the metrics of the team, and it's much more of a development feel going forward. New board, very much development-focused. New management team, again, very much development-focused. We'll talk a bit more about that going forward. At the back end of all this, and I guess this is why we're all here today, we've just completed a very successful merger transaction. It has taken some time. The Mont Royal merger with Commerce Resources is now complete, and, as you all know, we recommenced trading yesterday on both exchanges. That's a really exciting milestone to reach for the project.
There's real benefits in bringing this story to the ASX, and we can talk a little bit more about those as we progress through the presentation. As I said before, strategic asset. You can see where we're located in that northern part of Quebec. It does come with some issues. That northern part of Quebec is very much infrastructure-poor. We do have some challenges in that space, and that's possibly one of the reasons why this project has been milling around the gate for so long rather than progressing forward.
But as I said before, the tailwinds that we're seeing, the pressure and the sale that we're getting, not only from the provincial government in Quebec but also at the federal level in Canada, and that real sense of nationalism that Canadians are feeling at the moment, is all translating into real and tangible support for a project like ours to go forward. What this project really needs in the first instance is infrastructure. We need an access road. There's a few options that we've been looking at. We've just finished a road access analysis piece, which we are now sharing with government, local Indigenous groups, and industry. There's a couple of routes, but the route that is really starting to shape up nicely at the moment, I think, is the route down south to Schefferville. It's certainly on the radar for the government of Quebec.
They really want to see that route opened up, not only for us but for other players in that area. Other exploration plays as well. It's also garnering a lot of support from the local Indigenous groups as well. They really want to see that area opened up for their own purposes. They like to hunt and fish, and an access road in that area would certainly help them in that space and allow them to connect to the wider world as well. The dual listing, and I spoke about that before. We're really seeing, and we've seen that translate in a really successful and rapid IPO process that we've just been through. We're very much oversubscribed in that very short space we had the IPO open for to raise that AUD 10 million. We could have taken a lot more. I kind of wish we had.
But anyway, we have raised a good lick of capital, AUD 10 million. Again, that access to the Australian markets, I think we are getting a really good response from the Australian market. The Australian investing market very much understands assets like this. They understand the scale of these sorts of assets and they understand, I guess, the opportunities that come with them with connecting into government and also wider industry in this part of the world. So we are getting a really good response with that dual listing. It is one of the key reasons why we have gone through this whole merger transaction and elected to join these two companies together. Okay. A little bit on the capital structure. I will not spend too much time on this. But essentially, I guess the key takeaways are, we have launched with an EV value of around CAD 27 million.
With the raise, on top of that, we have got a market cap of around CAD 38 million. There is around, in warrants and performance rights, we are looking at around 110 or so out there in the market, 110 million out there in the market also. So, we are off to a good start. We certainly have enough cash in hand to go forward and focus on what we need to do to take the story forward. That is, again, very much a development story going forward. So PEA, moving into a PEA space, moving into permitting. The heart and soul of these projects is always metallurgy. We have got a really good metallurgical story at this stage. We know we can go all the way through to a mixed rare earth carbonate and produce a very much a saleable product.
But there are always ways you can optimize that. So we need to spend some time on, an additional time and money on making sure that we get that flow sheet as best as we possibly can when we get this project to the execution stage. So of course, there is a strong focus on metallurgy going forward as well. But yeah, long and short, we are cashed up. We have also got, just to add to that, we have got around CAD 3 million in tax returns coming towards the end of the year as well. So this is rebates from the flow-through share program, the exploration work that has been done by both companies over the past 12 months or so. So that is going to be a nice little top-up to the coffers as well. A bit more about the project. 100% owned.
We are about 130 km south of Kuujjuaq, which is the regional center in the Nunavik. It is an Inuit town.
The administrative center, as I mentioned before. We have got a JORC resource estimate. It is actually an NI 43-101 estimate, but it is also JORC compliant. We have been through that process. With that, we see around 204 million tonnes at around 1.9% TREO. Now, coming with that is a really nice grade of fluorite. Fluorite is a really interesting mineral. I have not had much experience with fluorspar, sorry. But going forward, there are some real opportunities in that North American space with regards to producing a fluorspar product and meeting the market. The U.S. and Canada are net importers of fluorspar at the moment. It is a really important additive in the steel-making, aluminum-making industries and also in finishing uranium products as well. So certainly a strong demand for that met-grade fluorspar product within Canada.
There has been some really good work done in the metallurgical space around that.
I think it's going to be a really quality, a high quality and important additive to the cash flow story in that stage one execution piece for this particular project. As I said before, we produced a good fluorspar by-product, and we really want to try and incorporate that into the flow sheet going forward. There's a little bit more work to do in that space. The basket itself, a really nice component of NdPr in there. That's really important. This is a magnet story, this particular deposit. It folds in really well. Whether those magnets are going into consumer electronics, power generation, into EVs or even the military, it doesn't really matter. But we do have a really strong basket. We have that really strong mass pull that we see with those recoveries at the concentrate stage.
Every tonne of ore we put through this particular project at the crusher end, we pull about 12.5 kg of TREO. And it's an enormous pull. And that's a really good story. That adds to the economics. So we've got a really nice basket. The mineralogy, we've talked about that already. We know we can float this stuff really well. We produce a really good quality float concentrate, around 65% recovery to produce that 35%-37% TREO concentrate. As I said before, that gives us options. That TREO concentrate is potentially sellable in its own right, or we go further downstream to produce that mixture of carbonate through a sulfation bake process. On to the board. As I said before, a new board in place, led by Cam Henry.
Cam Henry's a well-known mining executive in the West Australian space, but operating extensively through Canada, as is Adam Ritchie, both engineers, along with myself. So we've got a really strong sort of focus on development. As I said before, we've got three builders. And behind us, we have Ronnie Beevor and Jeremy Robinson in the financing space. Jeremy's a really interesting guy. He absolutely understands rare earth projects. He's got a really good nose for those sorts of projects. Really pleased to have him on the board. And Ronnie Beevor's been around for a long time, and he comes across from the Mont Royal acquisition to support us in that space. But as I said before, very much a forward-looking, industry-focused board. Very pleased to be working with these guys going forward. The old management team is out, aside from Darren Smith. Darren's a really interesting guy.
Obviously, I'll come to him in a second. But Peter Ruse comes across from Mont Royal. He'll be the Head of Corporate Development. Really pleased to have Peter on board. He's been a real asset, particularly in this merger process. So looking forward to working with Peter and taking the story forward. Cindy Valence, she steps into the VP Government Affairs role. Cindy's a really quite a unique person. She has been instrumental in opening doors for us in Canada. She has that ability to pick up the phone and talk to pretty much anyone, either at the provincial or federal level. And she has a fantastic working relationship with the Indigenous groups that we're engaging with, the Naskapi and the Inuit. So really pleased to have Cindy on board. She's doing a great job.
She is kicking down a lot of doors for us in that government space, which is absolutely what we need, particularly when we talk about one of the key drivers for this project going forward is that infrastructure commitment from government. Cindy is absolutely the right person to lead that charge. Darren Smith. Darren has been with the project for 15 years. He is associated with other projects, high-profile projects such as Patriot Battery Metals. He is a geologist, but he has also got a really strong metallurgical bent as well, so he understands flow sheets exceptionally well. He understands the rare earth market. He will be staying on as an advisor for the next while. Then behind him, we have Gavin Beer. Gavin Beer is a guy that I have brought in. I have worked with Gavin many times in the past in the rare earth space. Metallurgist.
He has worked on most rare earth projects around the world. He spent a lot of time in his early, his younger years working for Lynas. So certainly understands good projects. He has got a really good knack for looking at work that others have done, and that is certainly his remit at the moment. He is looking at all the work that has been done in the past in the metallurgical space, both REEs and fluorspar. He will be having a close look at that and seeing what opportunities there might be going forward with a new approach with some fresh set of eyes on that. We have got some interesting test work coming up, which I will talk a little bit more about further down the presentation. But great to have Gavin on board. The development strategy.
As I mentioned before, the key drivers that we have for the moment are really what is in front of us. We really need an access road. We need to get in front of government, make sure we get an access road in place. So this is the immediate focus for us. We need to close out our PEA. So we are looking to bring that to market in quarter one next year. We need to start thinking about how we stage the development of this particular project. As I said before, the quality of the concentrate does give us options. We need to really have a good think about that as we go through the PEA process and prior to the PFS process about how we consider the developments, the stage development, potential stage development of this project.
The old thinking was that we would go straight to separated oxides. We have pared that back. That really is, in my opinion, a step too far in this instance. We really want to reduce the risk. We want to reduce the capital burden for that start-up project. The scale and the quality of this project allow us to do that. So, we need to take advantage of those opportunities that this particular deposit and the support that we are getting out of the Canadian government offers us. Staging this is a really smart way of going forward. So we are reducing the scale, coming to market with around 3,000 tonnes of NdPr a year and about 100-1 50 tonnes of DyTb. So it is a really good start. This project is eminently scalable. We can scale this thing up over time to meet the market.
Moving on from that. Secondary development focus is really our unlocking value from other commodities. I mentioned fluorspar already. We also have a really interesting niobium story that's developing outside, and just adjacent to the rare earth story. Bringing that forward is really important. As I said before, incorporating some sort of fluorspar flow sheet into that stage one development is something I'd love to try and deliver. We'll see how we go with that. But we've got a little bit of work to do just to make sure we optimize that flow sheet and bring it in. We don't want to create a rock for our backs with regards to creating an exceptionally large capital or technical burden for us to bring this project to market.
We're very mindful of that, how fluorspar might play into that, but I'd love to try and incorporate that in that first instance. It's certainly going to be a nice little value-add to the project going forward. And niobium. We've had some really interesting hits in that niobium space. We see really good niobium hits from surface, nice wide intercepts and good grades. There's an opportunity there, but I think niobium is probably something that we'll be looking to push along a little bit later on. We'll focus for the moment on fluorspar and rare earths, and then that niobium story potentially becoming that third value-adding prong, I guess, to the Ashram story going forward. In a wider sense, we want to diversify downstream.
We're very much looking at being a junior miner in the first instance, so stopping at that float column or potentially a mixed rare earth carbonate story. We're not going to go all the way through in the first instance down to a magnet as some others propose to do. That's just technically, it's a big chunk to bite. Capital-wise, an exceptionally large chunk to bite. And it really stretches juniors beyond their limits, I believe. So sort of paring it back and sort of staying in our lane for the moment. But going further downstream is absolutely something we want to look at. For us, it's really, I think, collaborating and considering JVs with industry to go further down into those value-adding steps beyond a mixed rare earth carbonate. So these are the steps of separation, metallization, and then ultimately magnet-making.
There's lots of other groups out there which do it really well. They have the expertise. So working with those groups, collaborating with those groups, looking for JVs in that space with industry is probably a smarter way for us to go forward in that sense. That's something that we will be keeping an eye on as we go forward. Those conversations on the far right-hand side are going to become very much easier once we have a few key things in place, and one of those is completing the PEA and getting that commitment from government on an infrastructure piece for access to this site. I think once we have those in place, people will really start to see, the industry in particular, will start to see how they could potentially access these molecules.
These molecules have an access out to the wider world, and that's when those conversations will really start to build up, I think. That's our development strategy going forward. I'm just going to skip this slide. I know everyone understands where rare earth elements go, but these are all applications which would absolutely suit our basket profile. We all understand the thematics going forward. We understand that the demand is growing, and that there is going to be a supply gap going forward. There will need to be new businesses that come into this market to not only at the mine gate, but we have a very immature supply chain in the West. There's an awful lot of space and a lot of work that needs to be done in the separation space and the metallization space. Excuse me. In the magnet-making space as well.
All those things need to grow in concert. The mine gate is only one of those pieces of the puzzle. Okay. A bit more about demand. We understand all these issues, I think, going forward. Okay, just a quick peer comparison. Look, unfortunately, due to ASX restrictions, there's only so much information we can put into this. I suggest you all go away and do your homework. If you look at the last two columns in particular, there's a really interesting ratio that develops there. If you look at those last two numbers and build your own ratios of those, you will see that we are absolutely by far and away the cheapest story in the market. We are very much undervalued when you look at our contained TREO.
That's really all I can say about that at this stage for fear of being in trouble from my CFO. Please go away and do your own research on that. We are cheap, and there's a lot of room for us to move in the development space and in value. Okay. I touched on this a little bit before. As I said before, we get really strong support from the provincial government. Quebec's a great space to do business. We've already had some early support from these guys in the previous years. There's been, I guess, the key takeaway for me, the most exciting thing I've seen in the rare earth space for a long time, was the announcement that came from Carney about six weeks ago, two months ago, on Canada stepping up its commitment to NATO spending. They're moving up to 5% of GDP.
It's an enormous amount of money. The interesting thing was, the takeaway from all that was that 1.5 of that five is being committed into critical mineral projects and associated infrastructure. A project like ours with an advanced metallurgical story, an enormous amount of tonnes, we know this thing works. We are an absolute key candidate for that sort of support. That is something we're really going to be diving in on and trying to push as much as we possibly can. That commitment from government, I think, is going to be a real rewrite for this story into something that we're focusing very hard on. Of course, it was the most exciting thing I'd heard for a long time, but then the MP deal popped up on the floor price story, which probably eclipsed that.
It has been quite a remarkable six months or so for newsflow in the rare earth space. I could not imagine some of these things would be popping up, but crazy times we live in. As I said before, Quebec, a great place to do business. They are absolutely focused on opening up that northern part of Quebec. There are a couple of industry groups, government groups that we are talking to in that place, in that space, sorry. Plan Nord is one of them. Investissement Québec is the other. We have regular conversations with those guys, and they are keenly interested in supporting us with regards to gaining some money to go and sort these infrastructure pieces out. We do not want to own the road.
We really want government to own the road or even the indigenous groups to own the road, and we would be quite happy paying a toll to access these roads. We certainly do not want to have that burden of trying to build an access road ourselves. It just does not work. It is not something that junior companies should be doing, in my opinion. I think these sorts of things are for the good, for the betterment of Northern Quebec and Quebec in a greater sense. These things being built by government for the benefit of many, I think is a much better way to go forward. Behind that, we have really strong support from our local indigenous groups. The Inuit to the north, who are based in Kuujjuaq. Great relationships with those guys, which is where our project is housed.
That potential access route to the south and the Naskapi, they are very keen to get in and support and lobby government on our behalf to see that access road open up. As I said before, it is something that they are very keen on having as well. It is not just about trying to support us. They have their own reasons for wanting that road to go in, and we just sort of fold into that story behind. I will just skip through this. Again, remarkable time that we live in at the moment. The geopolitical tensions that are being driven by the angst between China and the U.S. is enormous. That is only benefiting us. I hope it goes on for a little bit longer. It is certainly creating a very fertile space for us to operate in at the moment.
It has been great. A little bit about deposit itself.
You can see a cross-section here. It is enormous. 204 million tonnes, as I said before. Great proportions of NdPr and a good lick of DyTb that comes along with that as well. It is an attractive basket that goes out that would be offered up to a separator through the, whether it is a concentrate that we are shipping out or whether it is a mixture of carbonate. It certainly has the right proportions. As I said before, it recovers. Really good recoveries. This metallurgy works, and that is really important. Very low strip ratios. You can see in those early years, some starter pits would just be focused essentially potentially in that 100% ore zone only. So extremely low strip ratios, very low risk, upfront mining application, very low mining costs in that space. It is essentially only ore that we are mining.
You can see that this thing is open at depth. That pit, I think, is looking at about 70-80 years of mine feed, and the ability to grow that mine feed with some additional exploration is enormous. It just goes on and on and on. It is a fantastic project to have our hands on. A bit about the value chain. As I said before, we really want to stay in our lane. Our current focus is on steps one and two and potentially step three. We are not looking to go any further down that value chain on our own. Those steps four, five, six, and seven would be through collaboration with others, I think, in this instance. For us, again, we need that access road in place that is really going to allow this story to take off.
For us, very much a development story. We want to focus on those steps one, two, and three. That is really where we belong. It is a lower-risk story. We actually recover about 80% of the value of the oxides in those first few steps anyway. So it is a sensible place for juniors to stay, and that is, I think, is the way that we will be taking this project forward. Again, a little bit more on the options. You can see here again, option one is just to produce a float concentrate, either sold to a third party or potentially JV downstream in hydromet. Or we go straight to a hydromet flow sheet ourselves. Again, we have some thinking to do in that space. We can wear both of those options.
It really comes down to a question of economics for us, and we will work through those options over the next few months as we close out the year. Again, the basket. About 25% of our basket is magnetics, and that drives about 93% of the value. So it is not the best basket out there. It is certainly not the worst basket out there. It is a good quality, robust basket. But when you combine the composition of that basket with the excellent recoveries we get at that flotation stage, that very high mass pull that I was talking about. We get 12.5 kg per tonne that comes through. That is quite remarkable. So we produce a lot of metal for a very low input of tonnes. So we are in a good space in that area. Again, a bit more about fluorspar.
As I said before, metallurgical-grade fluorspar is really where we are going to be concentrating. It is the lower-grade fluorspar concentrate that is made anywhere between 60% and say, 85%. You can see the industries on the right-hand side that that serves. We have made fluorspar products. We have made asset-grade fluorspar products with previous met test work. But we have more work to do in that space. We really want to optimize that. We know we can do it. But the nature has been very kind to us in the sense that in that flotation stage, the rare earth elements float off to produce the rare earth element, the monazite concentrate. The bulk of the fluorspar reports to the underflow. So the underflow typically is the portion of that process which goes out to a tailings dam. We can recover that underflow stream.
We can recondition it and refloat it and capture that fluorspar. There is a good segregation between REE elements and fluorspar in that very first instance in that flotation portion of the flow sheet. We certainly need to take advantage of that and a little bit more work to do in that space. U.S. and Canada, net importers of fluorspar. There is a huge opportunity here to start servicing local markets for this particular commodity. I mentioned niobium before. You can see in the blue, this is the rare earth deposit. To the south and to the east of it, you can see where we have started some of the drilling, more recent drilling over the past couple of years for niobium.
The niobium clusters, they occur in clusters around this REE core. Eventually, if you searched hard enough, you would probably find they surround the entire rare earth deposit. We will look at those over time. At the moment, there has been some interesting work done on the south there. Grades we are seeing are around 0.6% niobium, and we know the mineralogy is producing a good flow concentrate. This would be a separate and discrete flow sheet to what we have for rare earths and fluorspar. Just as a bit of information. Us mining this at, say, a 0.6 average, we are about twice the grade of what Niobec are mining underground with in Canada. I think they may be mining at 0.4 perhaps. This is really good high-grade niobium in Canada at surface. Really nice wide intercepts. More work to do here.
There is no resource on this yet, so we cannot talk about any tonnes of grade. Again, the priorities. I guess I said before, very much a strong development focus going forward. We are looking to work closely with the Quebec and federal governments, and it is all about that road access. We have got to get road access. That really is going to be a rewrite for this story. Not only for us, not only for you guys in the market, the shareholders, but also for industry as well. Once industry can see how these molecules can leave site, it is really going to peak their interest. Those conversations will really start to become real ones. They can understand how those molecules are going to get off-site and what the time frames are. We can start to dovetail into industry's plans going forward.
We will start looking at some of those JVs and collaborations further down that value chain. We are going to close out the PEA. It is about 50% complete. We are looking to bring that to market sometime in quarter one next year. At the completion of that, we will have a framework, essentially, from the PEA to start our environmental baseline work. We will start kicking off those work programs. That is probably towards the middle of next year. Same with starting a pre-feasibility study. I think we are looking to start that around the middle of next year at the completion of the PEA studies. With that comes the build-out of the development team. We really want to start bringing some of those key management pieces inside the tent. It has been very much an outsourced story in the past.
We are going to bring those key positions into the tent.
We're not going to have a large team, but we're going to have a very focused team that owns those important study components. We'll be looking at employing our own metallurgist. We're looking at bringing a study manager in to run the pre-feasibility study and looking at an environmental permitting manager to come in and start looking at those sorts of things. So bringing those key positions in, as I say, small team, nimble team going forward. Continue to collaborate not only with the government but also the Indigenous stakeholders in the region. As I said before, very shortly, I'm very confident that we're going to have some sort of commitment from government on an infrastructure access piece. That's really going to allow us to really start having real and serious conversations with industry with opportunities for downstream. Okay. Nicholas, I think back to you.
Thanks very much, Nick. That was a great run-through. Really appreciate it. Very interesting story. Just a reminder to everyone that's tuned in, please take advantage of Nick here to answer your questions. So fire them in on that Q and A tab, and we'll ask Nick to address them. Nick, I just wanted to start with one on news flow, because you and the team have obviously been very focused on completing the transaction in the last few months. I guess for someone coming into the stock today, what can we look forward to broadly over the next weeks and months? You must have quite a bit of pent-up activity that you can talk about in the coming period.
Oh, look, absolutely. Look, I think what you'll be seeing, Nicholas, is a refresh on some of the more recent achievements, just to remind everyone of how well-positioned we are, particularly in the metallurgical space. You can't have a great metallurgical story unless you've got a great resource. So just reminding everybody about some of those metrics, I think, is really important in the first instance. There's some really interesting met test work programs that Gavin Beer is looking to take on at the moment. We've got a tonne of sample coming across to Perth in Western Australia. We'll be just doing some twinning of the work that's being done in Canada. As I said before, getting those fresh eyes onto some of those metallurgical pieces. So looking at producing around 30 kg of flotation concentrate and trying to optimize that process with some new thinking.
We'll be having a closer look at fluorspar and how that works, how that might fit into the flow sheet story. Then some of that product then going off to ANSTO as well. We'll be having another look at the mixed rare earth carbonate story, that sulfation bake story. Got some really smart people at ANSTO. So just having, again, some fresh eyes there on those three prongs, those three commodity prongs, I guess. Then finally, there's some really interesting and innovative work that's happening in the met space, which may eventually see a substitution of the traditional flotation and sulfation bake axis that we're looking at. So we've got some really, and I can't talk about those guys at the moment. People can probably work out who they are.
But there's some interesting and innovative groups out there which are looking to grab our concentrate and see what they can do with that. So certainly some interesting news flow coming from the met space over the next six months. We'll be closing out the PEA, as I said, before Q1. So look out for that. Then those all-important collaboration pieces with government. Because we're working really hard on those commitment pieces and agreements with the local Indigenous groups, too. They are very keen to take that infrastructure piece story for us to government. So watch out for those.
Excellent. Thanks, Nick. There's lots of questions coming in online, so we'll get straight into them. An investor says, "There were lots of abbreviations in the presentation, lots of commodity references. Can you summarize the main commodities that are likely outputs of the project?" And I guess for the benefit of those that may not be as familiar with the rare earths project as you.
Yeah, sure. So within our mixed rare earth carbonate is an intermediate product. It's the secondary concentrate that you produce from the flotation concentrate. So the flotation concentrate process is really about crushing up the rocks, liberating the monazite minerals and floating those monazite minerals off. That's only half the story, though, because the rare earth elements are contained within those monazite grains. So you need to break open those very robust grains, and that's what that sulfation bake process is, the second stage. And that's the addition of a lot of acid. It's the addition of a lot of heat. It breaks open those monazite grains and really releases all those rare earth elements. And that secondary concentrate that you produce is the mixed rare earth carbonate. Now, again, it's a high-grade concentrate. Those elements are then liberated.
That carbonate can then be sold to what they call a separator. And the separator will put that back into solution and separate them out into those individual rare earth oxides. And most separators in the West are just targeting neodymium, dysprosium, terbium. There's a couple in the West that are starting to selectively pull in other elements. In China, they separate everything. So those opportunities are starting to open up in the West. But that's essentially the process. So you would change the title of that mixed rare earth carbonate product.
Excellent. Most of the value is in those four key magnet rare earths you highlighted.
Yeah, absolutely. All 17 elements come along for the ride. Whether you are talking about a flotation concentrate or a mixed rare earth carbonate, that secondary intermediate product. All 17 elements are in there. They all come together in varying proportions. That is always something you need to look at with these particular projects. What does that assemblage look like? What does that basket look like? We know that about 24%-25% of our basket is made up of neodymium, praseodymium, dysprosium, and terbium. Four key elements that the market is looking for, predominantly for magnets.
Excellent. Thanks, Nick. There is a question here about the project itself and I appreciate you are relatively new to it but the question is: Is there any potential environmental issues in the project area? Has anything been identified historically that you are aware of?
No, we do not think so. There was some baseline work done about 10 years ago. Some of which we can actually reuse. We are just trying to ascertain what components of that study we can reuse before we kick off on our refreshed environmental permitting process next year. That process did not indicate any issues back then, and we are certainly not seeing any issues popping up with regard to environmental permits for that particular area. I think a lot of it is the consultation with the local Indigenous groups. As I said before, we have great relationships with those guys. As long as we are transparent and open with those guys and bring them along for the ride, which we intend to do. I do not foresee any problems with people in that space.
Fantastic. Next question here is: Is there a CapEx estimate for the road that's needed to unlock this project?
Yeah, absolutely. Look, and very high level. We had some very high-level engineering input at the desktop level around, which fed into this optimization of this, sorry, this route selection study which we've just completed. It's anywhere between CAD 1 million and CAD 2 million a kilometer. Coming south, we probably need around 300 km of road. So the CapEx could be anywhere from CAD 300 million- CAD 600 million to build that particular road. As I said, that is something that we want to keep separate from our own capital cost build-up. We really see support from government coming in and taking that over. Well, that's certainly the objective, so that's what we're pushing for. That would be the cost of going and building that road yourself.
Excellent.
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Fantastic. Thanks, Nick Holthouse. There's a related question here about what the wider economic benefit of that road could be. Why do you think that government funding will be there this time that I guess previous management weren't able to unlock?
Yeah. Look, absolutely. It relates back to that comment I made about GDP spending. That is a remarkable quantum for the Canadian government to commit to with regards to NATO spending and the 1.5. These are unprecedented times with regards to government support. Canada has a real willingness to go it alone in the critical minerals space. The conversations that we are having on the access road. There is ourselves, of course. We need an access road. There are other mature mining projects in that area. Torngat are one of them that would benefit from a road to the south. Commerce Resources which is, I think, in the PFS level now. They would certainly benefit from that road as well. So there are three plays which are certainly looking to move forward into development that would benefit from that.
You have the local Indigenous groups who want those roads. At the moment they rely on skidoo trails to get to a lot of their traditional hunting and fishing areas. They are quite upfront. They just say, "We would rather put our skidoos in the back of a ute and drive to some of these areas. It is going to save us days," essentially. So they have their own reasons for wanting those roads to be put into place. There are countless exploration plays which would benefit from cheaper exploration costs and having an access road adjacent to some of their properties. We are also having some fairly obscure conversations with groups. I did mention groups like Plan Nord, which has a mandate to open up the North. It is a Quebec government group, along with Investissement Québec, but also the Canadian military.
They have made it quite clear that they want or require access to the North as well. They do not just want to be able to traverse by air, they want to be able to go by rail and road if possible as well.
Excellent. Thanks, Nick. The next question here is: Would power for the mine development come from diesel?
In the first instance, very likely, yes, it would. But the Indigenous groups in the area, the Inuit and the Naskapi, they are very commercial folks, and they are both looking at their own power projects, which they would like us to be offtake of. One is a wind project in the region of the mine. The other is a hydro project. These are separate from any of our capital cost requirements. These are being progressed off their own bat. But they certainly look to us as being a major offtaker for those powers. For those electrons. We are certainly interested in participating in those sorts of offtake stories. I guess as confidence grows in our project, so will confidence in those particular power projects as well as ultimate suppliers. Ultimately, we certainly do want to get away from diesel.
In the first instance, it is likely, I think, that we would be kicking off with diesel.
Okay. Thanks very much. Thanks, everyone, for these questions coming in. There is a question here about, what are the levels of uranium and thorium in the deposit, and does that present any issues?
Yeah, that is a great question. We certainly do have radionuclides. Nearly all rare earth projects come along with us with some sort of radionuclide burden. We do not really have any uranium. We certainly do have thorium. The thorium at its background level is just at detection, basically. Uranium is not detectable. However, in the concentrate, it does get up to a level where it does become a placarded material for transport. We are looking to go to that second stage, that mixed rare earth carbonate stage, that crack and leach phase, sulfation bake phase, offsite somewhere. Dislocating those two processes. Producing a float con onsite and then transporting it offsite to be processed elsewhere. It would be a placarded material. But there are lots of examples of companies that are doing that. One of them is the company that I used to work for, Hastings.
We were looking at moving concentrate products at about the same becquerel tenor. That's the level of radioactivity. About 300 or 400 km across country to a secondary processing facility. Iluka has certainly been doing that. They've been shipping an even hotter product, actually, out to the coast at Geraldton and shipping that to China. I think they've stopped doing that, but they were doing that for four or five years prior. Any sort of mineral sands project you can think of in the southwest of Western Australia or other places in Australia too, I'm sure, they all have the same issues. These products need to be placarded. It's just a process you go through. There's a management plan that comes along with those licenses to transport this sort of material. This would fall within that remit.
It's eminently transportable, but it does need a management plan that comes along with it and approval.
Good answer. Thanks very much. The next question here is: Will you be looking to appoint directors who are connected in Quebec and could help at a government level? Could you comment more broadly on how you see that relationship developing and working as you progress?
Yeah. Look, the first part of that answer, absolutely. We are absolutely open to, well, I think it's essential. As we progress, we certainly need that Quebec content on our board. We are actually actively looking now, to be honest. If the right person pops up, we would certainly consider putting them on early. No, that is absolutely the plan. We need that Quebec content. It makes a lot of sense. In fact, it's essential, I think, going forward for a local project like this in that particular province.
And you are actually relocating yourself to Quebec, Nick, to lead the charge as well, I believe.
Yeah, absolutely. With my poor French, I am relocating myself to Montreal. I will be upseeing all the Quebecker over there with my very poor, not even pub French, to be honest. I have got a lot of work to do in that space. But absolutely, yeah. I am relocating to Montreal. Looking forward to doing that. I found from past experience, Nicholas, it is the best way to run these things, whether it be in Southeast Asia or Brazil or being close to the action is always the best way to go forward. We need that close contact with government. We need to really push this infrastructure piece as hard as we possibly can while we have this quite remarkable period of time. We have got this enormous geopolitical support to get things like this done.
So being there and being in front of government is really important. So yeah, looking forward to that.
Yeah, absolutely. Well, it has been very much in the news, and I think Canada again this week as part of their budget announced their commitment through a CAD 2 billion minerals fund. I was just going to ask you, in terms of that engagement, and you have outlined clearly how you see it playing out. But presumably, there is already grant applications and various processes underway, which were already in train. You are not sort of starting from a clean slate here, are you?
Correct. Yeah. That is not only with the Canadian government, but also with the U.S. government as well. So the DOD, or the DOW as it is now called, there is an application in with those folks for support. I think the DOW has been swamped with applications in the last 12 months. So I think that is going to be a challenge. That coupled with the fact that things are a little bit frosty between the Canadians and the U.S. at the moment. But as I said before, the support that we are seeing within Canada is just tremendous. It really is. There is a real sense of wanting to go it alone. And they are really sort of throwing everything at it at the moment. So I think we will get what we want internally out of Canada itself, going forward.
So, that is where we will be, I think, focusing our efforts.
Fantastic. Just was going to perhaps I think we've got through most of these online questions. A couple of other ones that came in earlier. I might just deal with those. We had an email question from a shareholder from Canada. He said his Commerce share is now converted to Mont Royal. "Congratulations on the merger. How do Canadian investors receive their new share equivalents, and how do we buy or trade on the ASX if our traditional platform doesn't accommodate?" I think the message presumably there, and perhaps if you could just clarify that the company is dual-listed now, so you can trade on either platform.
Yeah, that's right. There is a conversion. There was a conversion for Mont Royal shareholders. There was a 2.3 :1 conversion, which Commerce shareholders were availed of, and that was really just to square things up. I guess, if you look at what shares are trading at on the TSXV at the moment, if you apply that 2.3 factor and then apply an exchange rate between CAD and U.S., you should see what we're seeing in Australia with regards to value. Squaring that up and making it a 1: 1 is certainly something that the company's looking at doing just to get rid of some of the confusion that we're seeing with that disparity at the moment between the two share prices.
Excellent. There's another online question here. "When producing mixed rare earth concentrate, MREC, does that process use hydrochloric or sulfuric acid? Where would you source the reagents if so?"
Yep. It certainly does. Sulfation bake, as you can probably guess, uses sulfuric acid. It's typically on about a 1:1 ratio, so a tonne of concentrate uses about a tonne of acid. That's thoroughly mixed, and then it goes in as a paste, essentially, into that kiln and gets baked for several hours, coming out as a mixed rare earth carbonate. Coming in as a con, coming out as a carbonate after that cracking process. This all leads really neatly into where should we site the hydrometallurgy. There's a couple of really interesting options that are firming up for us within Canada. There's certainly a lot of government interest in seeing some of these industries coalesce in certain areas. So there's industry parks, typically near ports, which absolutely suits us.
We're talking to a few groups at the moment, government groups, which are looking to set up these sorts of facilities as critical mineral processing hubs and being a part of that industrial park. They are typically located to areas where there are reagents. Both the areas that we're looking at are quite close to sulfuric acid sources. When I say close, I mean about 100 km. You would have to truck it in. Still, it's not an arduous distance to truck a reagent like that in. Producing, we've got 50,000 tonnes of float concentrate. That's about 50,000 tonnes of acid you would need to use a year, just to give you some indication.
These industrial parks that we're looking at, which are very much being supported by government, are well connected with gas, power, and water as well, and the appropriate operating licenses for these sorts of industries. It's an appealing concept that the government is putting forward. We're certainly looking forward to taking advantage of that. As I said, there's a few areas on offer. They'll sort of coalesce and drop out over the next few months as we close out the PEA. In fact, in the PEA, we may not have actually made a firm decision. There might be a few options that we present in that PEA, for further downstream processing.
Excellent. Thanks, Nick. Look, before we start to wrap things up, I might just take you back to that peer comparison slide, because it's a fascinating one, and there's a lot of information there.
Yep.
Given this is Mont Royal's and the project's first exposure on the ASX, for the benefit of ASX investors, Australian investors, which of those deposits is, I suppose, closest to what you've got here in terms of scale, metallurgy grade, et cetera? How do you see that sort of value opportunity playing out in a big picture sense?
Yeah, absolutely. As I alluded to before, we are grossly undervalued. We are the cheapest stock on that page when you look at our contained total rare earth oxide tonnes, compared to our EV. How do we compare? As far as tonnes go, we are probably second on the list. I think Lynas is probably slightly larger. That is an enormous deposit as well. That is quite an unusual deposit. But a great deposit to be benchmarked against. With regards to mass pull, and when I say mass pull, I mean how much metal do we recover on a per tonne basis through the crusher. We are probably just behind Mountain Pass and Lynas. We are very close in that sense. So slightly lower grades, but probably a better mass pull in regards to recoveries.
When you combine that with the basket department that we have, we have a little bit of heavies, which I think both Lynas and Mountain Pass are probably lacking a little bit. So there are swings and roundabouts. But as far as scale goes, we are probably number two on that page. As far as mass pull, we are probably second or third. So it is an exciting project. As I said, it just needs that access road. But had that access road, it would be right up there with some of those peers.
Fantastic. Well, look, I think that is a good way to finish up, Nick. It has been a really interesting presentation. Thank you for your time today. I am sure we would love to get you back on here regularly as this project unfolds. It will probably be from Montreal by the sounds of it.
Absolutely.
Maybe just a couple of final words from you to round things out for us.
Yeah. Look, thanks everyone for jumping on board. This is really an exciting project. I am very, very pleased to have been given the opportunity to steer this story going forward. I am very much looking forward to accreting some value for you guys with some early wins. As I said before, I think the opportunity to get that rewrite from a government commitment is real. We are going to work really hard on that, getting the PEA out and making sure this thing is fit for purpose for industry. But enormously undervalued. Great opportunity for us to be able to take this forward and accrete some value and take the story forward.
Fantastic. The start of a very interesting story. Thanks very much, Nick, for joining us. Thank you to everyone who dialed in today as well. We really do appreciate it, and we appreciate your questions too. A recording of this will be made available later this afternoon on the company's socials, and elsewhere. We look forward to releasing that, and we look forward to seeing Nick again over the coming months. Nick, safe travels off to Montreal. Thanks for joining us today and all the very best with Mont Royal as you move forward. Thank you.
Thanks, Nicholas, and thanks everyone for joining.