Largo Inc (LGO)

[Slashnuts]

How I Discovered Largo Resources...(Warning! Long and Boring)

It all started over a decade ago on our family farm in Iowa. A neighbor stopped by with a big broken metal part from his combine. The words "made in China" where stamped on it. "Cheap Chinese junk", my uncle said. I always knew Chinese replicas were more likely to break, but I wanted to know why. So I began to research and understand types of metals and the function of alloys.

Around 2010, I read about a company called Quantum Rare Earth (Now Niocorp) that purchased the rights to what is likely the largest deposit of niobium in the world, for $10 million USD. I was shocked to learn it was actually discovered in the 1970's, in a cornfield, in Nebraska.

Intrigued about this unique project in my home state, I began my due diligence. I discovered the previous owner of this deposit was Molycorp who's former CEO was a gentleman named Mark Smith. When Mr. Smith took over as CEO and started putting millions of his own money into the company, my interest grew. I thought, what's this guy know from his tenure at Molycorp? He must really believe there's something in the ground.

The focus of my research then turned to Mark Smith. His background, Investor-intel video's, past employment history. There was just something about his charisma. The more he talked, the more I trusted and believed, he's a genuine, honest, straight shooter. I came to the conclusion that I would continue to closely follow Niocorp, and not buy the stock ($.50 at the time) until the mine was closer to production.

Not long later, Mr. Smith announced he was CEO of a company called Largo Resources. My first thought was, is he giving up on Niocorp and moving onto something else? My second thought was, what the heck is vanadium? Could it really be the next lithium or a better battery?

I was on the fence so I just sat back and watched him for awhile. I had never invested in a mining company, a foreign stock, and didn't know much about metals. The first Largo video I saw was the "first blast" dynamite explosion in Brazil. Pretty cool. But it was Largo's corporate video that got me. The part where Mr. Smith said, "a company is only as good as it's people". That's a phrase I had believed for many years. Mr. Smith began putting his own money into Largo so I loaded the boat in January of 2016 at $.12 US OTC.

I trusted Mr. Smith and it paid off. His instincts about the price of vanadium were spot on and I continue to hold all the shares I purchased. I'm still not invested in NIOBF at this time.

So what about Niocorp?

Let the speculation begin! I've always wondered if there was a grand master plan that would lead to a vanadium, niobium, titanium, scandium, iron ore, molybdenum powerhouse. The next Molycorp/Glencore. Like I said before, I asked Mr. Smith specifically about this and his response was that Largo's largest shareholders probably wouldn't be interested in something like that. What I thought was notably absent from his comment was that he didn't say HE wasn't interested in the combination of the companies. Sort of a politician type response, (no offense MS).

Niocorp is a very special, extremely unique project that is 110% worthy of developing. The final feasibility (bankable) study is complete and according to MS, it "will be financed in the near future". The projected ROI is remarkable and Largo shareholders would be lucky to own it, IMO. The deposit is massive. The orebody has been extensively drilled and is well defined, although it is open in several directions. They haven't found where it ends but they do know the deeper they drill, the higher the concentrations are.

Niobium is a lot like vanadium. It strengthens steel. It can be used to speed charge cycles in electric vehicles by as much as 30%. The best thing is the stability it would bring to Largo's revenues. Unlike the wild roller-coaster rides vanadium takes, niobium historically moves up/down only 5% per year. Very stable.

Titanium would also be produced in large quantities by this underground mine in Elk Creek, Nebraska.

When in production, this mine will be the largest producer of scandium in the world. Scandium does for aluminum what niobium/vanadium do for steel. It makes it stronger, lighter and more weldable. Think of a 747 without rivets! Scandium is also a crucial part of Bloom Energy's renewable energy fuel cell. A new, highly efficient technology where scandium can not be substituted. The scandium in this orebody will be a direct byproduct of niobium production with little to no further costs of refinement. Speaking of cost, scandium is so rare that it sells for an astonishing $3,500-$4,000 per kilogram. Gram, not ton! Niocorp will produce nearly 100 ton's per year.

All 4 minerals, are on the recent U.S. list as strategically critical to security. The U.S. currently imports 100% of it's niobium so this would be the only domestic source.

https://www.usgs.gov/news/interior-releases-2018-s-final-list-35-minerals-deemed-critical-us-national-security-and

The Trump Administration, the state of Nebraska, and the local community are 100% behind this mine.

https://www.omaha.com/news/nation/morton/nebraska-niobium-mine-s-quest-to-raise-a-billion-dollars/article_70cc1121-6b68-5f69-b5d5-93e37dff6698.html

But back to the Largo speculation...

For me, the first sign was when Paulo Misk was promoted from President of Brazilian Operations to Chief Operating Officer and President of Largo. In that release MS stated Paulo is well suited to assume the role "as the Company experiences future strategic growth."

https://www.largoresources.com/investors/news/press-release-details/2018/Largo-Resources-Announces-Record-Q3-Production-Results-and-New-President-and-COO/default.aspx

"Future Strategic Growth"

At that point, Paulo was no longer just the head of Brazilian operations, but rather Largo's operations that will grow into something bigger, outside of Brazil, as he was already head inside Brazil. That was the point of promoting him. In the latest presentation, slide 16, it speaks of "strategic growth through mergers and acquisitions".

Mergers and Acquisitions with who? What's the $750 million dollar shelf for? Is it coincidence this is near the cost of Niocorp's mine?

I keep repeating in my head what MS said. "Largo's largest shareholders probably wouldn't be interested in a M/A with Niocorp". But Arias has been selling and the board member stepped down.

One of Largo's newest and largest investors, West Family Investments, is from Nebraska. Is he interested in the Nebraska Mine?

I also noticed something that used to be on Largo's website and presentation is now missing. It doesn't say "The only pure play vanadium producer" anymore. Now it says "one of the lowest cost primary producers of vanadium.

"Our Vision
To become a leading, world-class mining company focused on responsible development and strategic growth while maintaining the respect of investors, employees, customers and partner communities."

Largo is a cash cow. I think it would be an excellent way to diversify.
MS is the largest shareholder of Niocorp and is pretty passionate about the project. Does he feel the two are a good fit?

This article from 5 years ago sure thinks so...

https://investorintel.com/sectors/technology-metals/technology-metals-intel/market-watch-mark-smith-dual-ceo-role-largo-resources-suggests-business-consolidation-critical-materials-business/

Finally, most here know MS worked for CBMM, the largest niobium producer in the world. I just wanted to make sure everybody knows a bit about our President and Chief Operating Officers 28 years of experience.

"Most recently, Mr. Misk ran Anglo American's Catalão Project from 2011 to 2014 where he was promoted to Head of Niobium Operations after serving as Niobium General Manager for one year. During his tenure at the Catalão Project he was responsible for implementing innovative policies and fostering a high-performance culture that greatly improved production rates and recoveries, as well as dramatically reduced unit costs resulting in a doubling of Niobium EBITDA."

Good Luck To All!$!$