Niocorp Developments Ltd (NB)

[chico237]

Hey Norcal & all! There certainly are a LOT of DOTS! Did you Catch THESE DOTS from a Reddit post bro? Following MAGNEQUENCH....

Sharing NOV. 10th, 2023, Responses from Niocorp in regard to NEO PERFORMANCE MATERIALS & THE OLD MAGNEQUENCH PATENTS:
Jim-
Given: Hitachi, Neo Performance Materials & China....
https://www.tengam.com/wp-content/uploads/2012/07/MagnequenchPatent.new-20121.pdf
a) ARE any the above Patents still RELEVANT? - Who owns the remaining MAGNEQUENCH patent rights? Does Hitachi, Niocorp, or another entity?

b) Is there an ongoing "current effort" by Niocorp &/or other Collaborating Entities to update or improve upon or file NEW patents, leading to future mine to magnet capabilities & supply chains? Comment if you can...

RESPONSE:

"The patent landscape covering the production of rare earth magnetic alloys and magnets is extraordinarily complex and continues to evolve as new patents are filed, patents expire, licensing deals are made, and so forth.
NioCorp does not hold any patents covering rare earth magnets, and I cannot speak to what other companies hold in terms of such patents.
NioCorp files patent applications or secures licenses when necessary. In general, it is not prudent for companies to comment on their prospective patent strategies."
Also Adding-
"Neo Performance Materials is the parent company of Magnequench, and Magnequench has a robust patent portfolio."*********
Jim Sims

(NOW THAT IS DARN INTERESTING!!!!! INDEED BRO! GIVEN THE FOLLOWING INFO-)
SEE REDDIT LINK:
https://www.reddit.com/r/NIOCORP_MINE/comments/185tvma/niocorp_stellantis_neo_performance_materials/

July 6, 2023 ~ Stellantis and NioCorp Sign Rare Earth Offtake Term Sheet in Support of Stellantis’ Commitment to Reaching Carbon Net Zero by 2038
https://www.stellantis.com/en/news/press-releases/2023/july/stellantis-and-niocorp-sign-rare-earth-offtake-term-sheet-in-support-of-stellantis-commitment-to-reaching-carbon-net-zero-by-2038

Term Sheet Also Envisions a Possible Strategic Investment by Stellantis in NioCorp’s Elk Creek Critical Minerals Project
AMSTERDAM and CENTENNIAL, Colorado - Stellantis N.V. (“Stellantis”) and NioCorp Developments Ltd. (“NioCorp” or the “Company”) (Nasdaq:NB) (TSX:NB) today announced the signing of a Rare Earth Offtake Term Sheet (“Term Sheet”). The objective is to enter into a definitive rare earth supply agreement to support Stellantis’ commitment to build resilient supply chains and reach carbon net zero by 2038 and to help accelerate NioCorp’s path to commercial production of magnetic rare earth oxides in the U.S.

The Term Sheet executed today envisions a definitive agreement for a 10-year offtake contract for specific amounts of neodymium-praseodymium oxide, dysprosium oxide, and terbium oxide that NioCorp aims to produce at its Elk Creek Critical Minerals Project (the “Elk Creek Project”) in southeast Nebraska, subject to the receipt of adequate project financing. Final volumes would be set in a definitive agreement.
“Stellantis intends to lead the industry with the commitment to be carbon net zero by 2038 – a goal that requires innovation and a complete redefinition of our sourcing strategies,” said Stellantis Chief Purchasing and Supply Chain Officer Maxime Picat. “By working with partners like NioCorp, we are taking important steps, with the aim of decarbonizing mobility and ensuring strategic supplies of raw materials necessary for the success of the Company’s global electrification plans highlighted in our Dare Forward 2030 strategy.”

“We are very pleased to announce that NioCorp and Stellantis have agreed to collaboratively develop Stellantis’ magnetic rare earth supply chain, including helping to identify a sintered rare earth permanent magnet manufacturer that provides additional geographic optionality to Stellantis, in support of their ambitious commitment to reach carbon net zero by 2038,” said Mark Smith, Executive Chairman and CEO of NioCorp. “We believe that NioCorp’s position as a potential U.S. supplier of multiple critical minerals needed for vehicle electrification offers Stellantis important optionality to secure supply chains and support its growth targets.”

DID YOU CATCH - "helping to identify a sintered rare earth permanent magnet manufacturer!" WHO???? indeed... the plot thickens...
NOW FOR THE U.S. POSSIBLE LINK!!!

Nov. 27th, 2023, ~ Neo Performance Materials: Magnetic Potential With A 6% Yield
https://seekingalpha.com/article/4654358-neo-performance-materials-magnetic-potential-with-a-6-percent-yield

*Neo Performance Materials has a dividend yield of 6%, a market cap more than covered by working capital, and little debt.
*Neo's existing business is proven and profitable albeit with volatile results in the last two years.
*Neo has a chance to become a major supplier of sintered magnets to the EV industry in the EU and the US.

Neo is in the rare earth and magnets business with a rare metals division thrown in for good measure (Neo seems to gravitate towards complexity as a company). The bull case for Neo is simply put that they have a shot at establishing themselves as a key Western sintered magnet supplier for EV manufacturers looking for alternatives to the Chinese companies dominating the space now. With that Neo would gain access to a massive new market that could be growing for years to come. You get that potential for practically free as Neo's existing business plus working capital in my view is more than enough to justify the current share price.
Before getting to that, let's first look at what Neo currently does. This slide from their investor presentation shows their full product set:


Magnequench
That brings us to Neo's magnet business, which goes by Magnequench. In rare earth magnets, that's not a random name: Magnequench, originally a General Motors division, literally was the company that commercialized neodymium magnets back in the 1980s. Through many twists and turns, it has ended up in the hands of Neo and with it an enormous amount of technical knowledge. Neo employs 100+ scientists, mainly in Singapore, and does a great deal of custom magnet development for some very blue-chip names (e.g. Honda (HMC)). This accumulated know-how should provide Neo some moat, even if I don't think it's an impenetrable on
What Magnequench produces is mainly magnetic powders that others then use to manufacture magnets. In 2019 the company started to move upstream into actual magnet manufacturing by acquiring a Chinese manufacturer of bonded magnets (mainly used in smaller motors of various kinds). To this was added a small UK magnet manufacturer in 2023.

What Neo does not currently make is sintered magnets, which is by volume far the biggest market. For some background on sintered versus bonded magnets, see here, but simplifying sintered magnets offers more performance at the cost of a less flexible and more difficult production process. For EV vehicles, the performance and efficiency benefits of sintered magnets are critical.

Neo fits the bill for that role: it has as good a pedigree in rare earth magnets as any Western company and it already is an established supplier to many auto companies, it "just" needs to move from manufacturing bonded magnets to sintered magnets.

Neo has already taken the first step with a sintered magnets plant in Estonia with groundbreaking taking place in Q3. The EU has put up €20 million in a grant, leaving Neo to cover €80 million themselves, with the head of the European Commission giving a speech at the groundbreaking ceremony (see link above) to prove Neo's status as a "for real" player in sintered magnets. Initial capacity will be 2000 tons per year, but Neo management seems convinced they'll expand that to 5000 t/year in short order. To quote from their press release announcing the Estonia plant:

Neo has been in advanced commercial discussions for several years with multiple magnet customers in Europe, and those discussions indicate a level of demand for sintered rare earth magnets that far exceeds Neo's planned Phase 1 production capacity.

That plant will be up and running in 2025, though material revenue will likely not be until 2026. Management has indicated phase 1 alone will produce $100-150 million in annual run rate revenue with an EBITDA margin of ~15% (based on comments in the Q3 earnings call) so around $20 million in annual EBITDA. The expansion to 5000 t/year, which should come at lower incremental capex, will more than double that, putting annual EBITDA in the vicinity of $50 million.

"Neo has also dropped some heavy hints that they'll soon be announcing a similar factory in the US, likely accompanied by government subsidies similar to the EU one. Examples of such hints include their investor presentation (see slide 37) or even more explicitly their recent Q3 earnings call with the CEO Rahim Suleman stating: "I also think that we will announce North America within a reasonable short order as well." One can then start doubling the EU EBITDA numbers and add even more on top to account for future expected growth in the EV market. "

https://www.neomaterials.com/wp-content/uploads/2023/03/Neo_Investor_Presentation.pdf


(YA GOTTA ADMIT THOSE ARE ALSO SOME NICE APPLES NORCAL....! POSSIBLE MINE TO MAGNET U.S. SYNERGIES BRO!)

FORM YOUR OWN OPINIONS & CONCLUSIONS ABOVE:
"I Know... I know... More Dots! But ya gotta admit they sure are Interesting!!!!!"


My List of Niocorp Things to do (IN NO PARTICULAR ORDER!)
a) Sign Anchor Investor
b) Complete & release FINAL 2024 F.S. (Independently Verifying Production at Scale "ALL CRITICAL MINERALS: intended for production, Plus FINAL OPEX/CAPEX with all the NEW MODERN COMPONENTS needed for the NEW Proprietary Separation STAGES & PROCESSING PLANTS!!!!) MINE TO MAGNETS & INGOTS!
c) Maybe a Mine To Magnet thing?
d) OFF-TAKE Agreements with Private & GOVT. ENTITIES! =)
e) FINANCE TO BUILD THE PROJECT $$$$$

(I would think both Govt. & Private entities are interested!)
Front Row seats still... into 2024 Season...

Chico