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West High Yield (W.H.Y.) Resources Ltd. Signs Forward Contract LOI to Sell Magnesium Ore from Record Ridge Deposit
West High Yield (W.H.Y.) Resources Ltd. (TSXV: WHY) ("West High Yield" or the "Company") is pleased to announce that it has signed a letter of intent (the "LOI") with APG Galaxy Trade and Technology, LLC, a U.S.-based company focused on the acquisition and production of magnesium and other precious metals ("Galaxy"), for the purchase and sale of magnesium serpentine ore (the "Ore") produced by West High Yield at its Record Ridge magnesium deposit (the "Deposit") located near Rossland, British Columbia, Canada (the "Transaction").
The LOI is non-binding as the parties work towards the signing of a binding definitive agreement (the "Definitive Agreement") in respect of the Transaction. The LOI contemplates Galaxy purchasing a minimum of 200,000 metric tonnes ("Mts") of the Ore per annum during the term of the Definitive Agreement. The purchase price will be USD$500 per Mt of the Ore during the first three (3) year period of the Definitive Agreement, and shall be subject to adjustment for the remaining term of the Definitive Agreement based on factors including but not limited to production costs and the Consumer Price Index of Canada.
The Transaction is subject to, among other items, standard conditions precedent in favour of each of Galaxy and the Company, individually, including the receipt by the Company of all necessary government and regulatory approvals and permits to extract the Ore from the Deposit. The Company has agreed to an exclusivity period with Galaxy for the sale of the minimum quantity of the Ore until all of its conditions have been waived or satisfied in full, during which it will negotiate exclusively with Galaxy with a view to settling the Definitive Agreement.
The Company will issue a news release updating this information and providing more detail on the parties and finalized terms once the Definitive Agreement has been entered into.
Frank Marasco Jr., President and CEO of West High Yield states: "The Company has been looking for interested and capable partners to purchase the initial mined inventory of our critical mineral rich ore and generate positive cash flow for the Company. We appreciate Galaxy's magnesium experience and customer demand, and we are pleased to have reached this milestone in advancing our negotiations with Galaxy towards a comprehensive definitive agreement. I consider this LOI as a critical step in building a strategic collaboration with Galaxy for the objective of securing a future market for a range of magnesium products that could be produced from the Record Ridge project."
Michael North, Board Chairman and CEO of Galaxy, states: "The magnesium serpentine ore controlled by West High Yield in British Columbia is one of the largest and richest verified deposits of its type in the world. Today, Galaxy is pleased to take the first step in a challenging process, intended to deliver this important natural resource from Canada to world markets and meet the requiements of the automotive, aerospace, energy, construction, nutritional, consumer products and pharmaceutical fields. Many industries need lighter, greener, more efficient materials right away, in order to meet climate change and carbon reduction goals. With this Letter of Intent, Galaxy initiates a demanding series of research, engineering and business development strategies that, if successful, may facilitate an efficient supply chain of cost-effective pure magnesium and alloy products for years to come. We look forward to further collaboration between Galaxy and West High Yield."
About APG Galaxy Trade and Technology, LLC
Galaxy is a direct source of magnesium, from mine to manufacturer, evolutionizing entire industries with light, strong, versatile, durable and energy-efficient magnesium. An international company based in the United States, Galaxy is streamlining global supply chains, offering both standard and custom alloys for unparalleled performance. Galaxy is helping to move the global economy from heavy metals to light metals of the future: clean, green, less carbon-intensive, bending the curve on climate change.
About West High Yield
West High Yield is a publicly traded junior mining exploration and development company focused on the acquisition, exploration, and development of mineral resource properties in Canada with a primary objective to develop its Record Ridge magnesium deposit using green processing techniques to minimize waste and CO2 emissions.
Contact Information:
West High Yield (W.H.Y.) Resources Ltd.
Frank Marasco Jr., President and Chief Executive Officer
Telephone: (403) 660-3488 Facsimile: (403) 206-7159
Email: frank@whyresources.com
Cautionary Note Regarding Forward-looking Information
This press release contains forward-looking statements and forward-looking information within the meaning of Canadian securities legislation. The forward-looking statements and information are based on certain key expectations and assumptions made by the Company. Although the Company believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because the Company can give no assurance that they will prove to be correct.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: general economic conditions in Canada and globally; industry conditions, including governmental regulation; failure to obtain industry partner and other third party consents and approvals, if and when required; the availability of capital on acceptable terms; the need to obtain required approvals from regulatory authorities; and other factors. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. The Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable law.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States. The securities of the Company will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") and may not be offered or sold within the United States or to, or for the account or benefit of U.S. persons except in certain transactions exempt from the registration requirements of the U.S. Securities Act.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OF THIS RELEASE.
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West High Yield
Overview
West High Yield (TSXV:WHY) is an exploration and development mining company focusing on critical minerals with a high-grade magnesium/silica/nickel project nearing production. The company’s Record Ridge property project leverages the opportunity to create a new supply of magnesium outside of China and Russia. West High Yield has an experienced management team ready to bring its project to production.
China provides 90 percent of the global magnesium supply, most critical minerals and even a large proportion of Europe’s consumption. Demand for magnesium is growing in multiple verticals, including the renewable energy sector and pharmaceutical industry. In addition, magnesium is a necessary mineral to reach global net-zero emissions goals by 2050. These global dynamics highlight the need to develop an on-shore, secure and strategic critical mineral domestic supply chain for magnesium/silica/nickel amid continuing supply shortages.
No matter what decarbonization path one follows, the metals and mining sector that mine and processes critical minerals will be at the core of enabling the energy transition that underpins modern society.
West High Yield’s advanced 100-percent-owned Record Ridge project in British Columbia, Canada is poised to create a secure, strategic domestic supply chain to cater to North America’s magnesium demand. The company is currently awaiting permits to begin production. Once production commences, West High Yield will start generating cash flow through the sale of ore and will seek additional offtake agreements.
The Record Ridge asset has one of the largest and highest-grade magnesium/silica deposits in North America, and globally. The company’s resource estimate shows 43 million tonnes (Mt) of ore at 24.6 percent magnesium, which implies a world-class asset containing 10.6 Mt of magnesium. In addition, West High Yield’s pre-feasibility study indicates strong economics with an after-tax NPV of 5 percent of $872 million, an internal rate of return (IRR) of 72 percent over a 172-year mine life, and payback in 1.5 years.
Additionally, the company has developed a green mining and refinement process to minimize carbon emissions during production. This green process utilizes over 90 percent of the ore extraction, not only of magnesium but saleable quantities of silica, nickel and iron. Magnesium is widely used in renewable energy technologies, so maintaining a strong ESG rating is essential for downstream manufacturing.
WHY continues to consult with the local community and the government throughout the permitting process for Record Ridge. In July 2023, the company announced a series of mitigation strategies to address concerns that have been raised through the public engagement process, including: substituting the use of explosives with mechanized equipment for ore extraction; implementing enclosed environments for crushing equipment to effectively manage dust and noise; and exploring the option for an alternative trucking route to avoid passing through the city streets of Rossland, BC.
In addition, WHY has signed a cooperation agreement with the Osoyoos Indian Band (OIB) with respect to the Record Ridge Project, which falls within OIB’s asserted territory. The agreement assures OIB’s oversight of the project to protect its people’s environmental and economic interests.
An experienced management team with expertise throughout the mining industry leads the company towards fully leveraging its promising asset. Experts in geology, corporate administration and engineering create confidence in the team’s ability to reach its goals.
Company Highlights
- West High Yield (TSX:WHY) is an exploration and development mining company focusing on its advanced-stage critical mineral magnesium/silica/nickel asset nearing production.
- The company’s flagship Record Ridge asset has the potential to strengthen and secure the North American on-shore critical mineral magnesium/silica/nickel supply chain and reduce dependence on China and Russia’s production.
- Magnesium is used throughout several verticals, such as aerospace, clean energy, pharmaceuticals, and as a potential disrupter in the battery segment. These multiple applications of critical minerals continue to widen the gap between growing demand and dwindling supply creating an opportunistic tailwind for WHY Resources and the development of the Record Ridge Project.
- Silica has been added as a critical mineral to the Department of Energy’s US list of critical minerals in demand for the safe and secure domestic manufacturing supply chain.
- Mining permit application for Record Ridge is underway, as WHY continues to work with the Indigenous nations, local community, and the government to ensure the Record Ridge becomes the best project possible for both the company and the community.
- West High Yield has completed a pre-feasibility study indicating robust economics that encourages the company to move forward.
- The company prioritizes clean energy operations to reduce emissions and ensure a positive ESG rating, creating low-cost, high-pedigree magnesium/silica/nickel products that result in virtually no CO2 emission.
- An experienced management team leads the company toward fully realizing the potential of its assets.
Key Project
Record Ridge Magnesium Project
Record Ridge Commercial Proprietary Hydrometallurgical Process
The 100-percent-owned Record Ridge project covers 8,972 hectares, approximately 7.5 kilometers west to southwest of Rossland, BC. The project is only 5 kilometers away from the US-Canadian border and has excellent regional infrastructure, including power, water, roads, proximate labor force and transportation. West High Yield expects to commence production in Q2-Q3 2024 in anticipation of the permit being awarded WHY has since announced a series of mitigation measures, as a result of the public engagement process, including: substituting the use of explosives with mechanized equipment for ore extraction; implementing enclosed environments for crushing equipment to effectively manage dust and noise; and exploring the option for an alternative trucking route to avoid passing through the city streets of Rossland, BC.
Project Highlights:
- Nearing Production: The advanced-stage project is currently in the final technical review required for the mining permit to initiate production. Once production commences, the company will begin generating cash flow through the sale of ore. West High Yield will also seek out new offtake agreements and with positive cash flow begin moving towards capitalizing on the property’s gold deposits.
- Encouraging Pre-feasibility Study: West High Yield’s pre-feasibility study (PFS) also indicates impressive economics, demonstrating an IRR of 72 percent over a 172-year mine life, an after-tax NPV of 5 percent of $872 million, and payback in 1.5 years. The completed PFS allows the company to move forward with production with complete confidence in future revenue.
- Sustainable Production with Minimal Carbon Emissions: The HCI leaching process the company will be using produces minimal CO2 emissions. The company’s specific process was developed to produce virtually no waste and low environmental impact. These efforts result in a top-tier ESG rating that will reflect on downstream manufacturers.
- Indigenous Community Collaboration: A cooperation agreement with the Osoyoos Indian Band (OIB) with respect to the Record Ridge Project, which falls within OIB’s asserted territory, assures OIB’s oversight of the project to protect its people’s environmental and economic interests.
Management Team
Frank Marasco Jr. - Founder, President, CEO and Director
Frank Marasco is the founder of West High Yield Resources. Marasco is also president and director of Big Mountain Development Corp. Over the course of 45 years, Marasco has built and sold 47 successful businesses, including hotels, motels, rental units, RV and mobile home parks, apartments, retail liquor stores, pubs, nightclubs and a retail mall. At the age of 47, he retired, later going into business in the oil and mining sectors. He had purchased 81 oil and gas development sections in S.E. Saskatchewan in the Bakken, as well as gold mines in Rossland, BC. After briefly exploring for and finding gold on the project, Marasco and his team then discovered what is now a world-class, 2,000-acre, high-grade, low-cost, critical mineral magnesium deposit known as Record Ridge.
Barry Baim - Director and Corporate Secretary
Barry Baim brings over 35 years of activating and inspiring teams to achieve profitable revenue growth. His senior leadership experience is diverse having held executive positions with both private and public companies including Tier one CPG and in the natural resource sector mining site development projects in oil sands, 3d seismic, logistics, remote lodging and other service-related entities in energy, oil and gas. Baim is currently a director for SGV Canada and a past board member with Millennium Seismic, Paradigm Chemical Technologies and Siksika Resource Developments Ltd.
Patricia L. Nelson - Director
Patricia Nelson was controller for Sabre Petroleum's, Petroterra Natural Resources and manager of Financial Control for Suncor. She is the vice-chair and director of the In Situ Oil Sands Alliance, director of Altalink, and director of Optiom Inc.. Nelson served 15 years as an elected member of the Legislature of Alberta. She was appointed and served as minister of energy, minister of economic development and tourism, minister of government services and finally, was appointed minister of finance. She served 12 years as a member of the treasury board and the agenda and priorities committee of the government. An active member of the community, she supports charitable organizations such as the kidney foundation, the cancer foundation, heart and stroke and juvenile diabetes.
Maria Marasco - Director
Maria Marasco is an independent businesswoman who has provided services in corporate restructuring finance, acquisitions, and strategic planning. She is also responsible for overseeing management information systems, human resource strategies, and property management systems.
Shelina Hirji - Chief Financial Officer
Shelina Hirji is a designated accountant with over 38 years of experience in infrastructure construction, oil and gas exploration, and mining. Hirji has been engaged in the oil and gas industry since early 1990, starting with various senior accounting and management roles in both public and private companies with extensive participation in growth opportunities. She has been a key member of the executive management team, assuming a strategic role in the overall management of the company. Hirji's experience in financial management includes financial reporting, corporate accounting, budgeting and forecasting, as well as stewardship of internal controls. Hirji is a member of the Chartered Professional Accountants of Alberta and the advisory committee for the TSX Venture Exchange.
Fouad Kamaleddine - Advisor
Dr. Fouad Kamaleddine is the founder/principal of AIS Inc., an integrated mining consulting partnership that provides technical services to mining companies including processing and metallurgy, project development and engineering studies. He has been an officer and director of many public and private mining companies. Kamaleddine has over 20 years of academic and industry experience with demonstrated success in conducting challenging industrial research leading to several inventions and multiple achievement awards.
James Gregory (Greg) Davison - Senior Geologist, Technical Advisor and Qualified Person
Greg Davison is a professional consulting exploration geologist, technical advisor, qualified person, project generator and manager, and ore mineralogist (exploration and metallurgy). Davison is currently licensed in British Columbia (EGBC) and has over forty-four years of practical field, laboratory and management experience in diverse geological settings. He completed his B.Sc. (honors geology) at Dalhousie University, Nova Scotia (1974-1979) and his M.Sc. (geology) at Brock University, Ontario (1981-1984), and is on the board of directors of TSX-V-listed Silver Spruce Resources and Playfair Mining. Davison provides extensive management, operational and applied skills for mineral exploration, including technical analysis of process mineralogy, petrography and ore geology, at all project levels from grassroots through advanced development and mining.
Rick Walker - P. Geologist and P. Engineer
Rick Walker has over 25 years of geological and structural mapping experience in the mineral exploration industry. Walker has a strong background, ranging from structurally complex areas to advanced exploration property definition. In addition, he has worked on a wide variety of deposit types, including porphyries, sedimentary exhalative, volcanogenic massive sulphides, low tonnage vein-type, industrial minerals; gold, silver, base metals, rare to strategic metals and diamonds. Walker has delivered significant geological value throughout his career for companies, ranging from junior to major resource companies, both nationally and internationally. He has also served as a volunteer for industry-related organizations, serving for 12 years as president of the East Kootenay Chamber of Mines, five years as a director of the BC and Yukon Chamber of Mines (now the Association of Mineral Exploration for BC), on the committee that developed the initial Mineral Exploration Code for BC and as an industry representative in the Commission on Resources and Environment (CORE) process resulting in the East Kootenay Land Use Plan.
Corey Peck - Junior Geologist
Corey Peck is a junior geologist who came to West High Yield Resources in the spring of 2007. He studied at the University of Calgary, where he received a B.Sc. in geology, with a minor in earth science. He has extensive training in both the field and lab settings. His skill set encompasses all aspects of geology, geophysics and geography, with particular emphasis on geotechnical logging, mineralogy and mapping. He currently resides full-time in Rossland, BC.
West High Yield (W.H.Y.) Resources Ltd. Announces First Tranche Closing of Private Placement
West High Yield (W.H.Y.) Resources Ltd. (TSXV: WHY) ("West High Yield" or the "Company") announces that, further to its news release of February 26, 2024, it has closed the first tranche (the "Closing") of its previously announced private placement offering (the "Offering") of units (the "Units").
The Closing consisted of the issuance of 2,114,000 Units for gross proceeds of $528,500. The Units were issued at a price of $0.25 per Unit, and each Unit consists of one (1) Common share of the Company (each, a "Common Share") and one (1) Common Share purchase warrant (each, a "Warrant"). Each Warrant, together with CAD$0.35, entitles the holder thereof to acquire one (1) additional Common Share until March 14, 2025. All securities comprising the Units issued on the Closing will be subject to a trading hold period expiring four months plus one day from the date of issuance
The proceeds from the Closing will be used to support the Company in furthering its permitting process and covering general working capital.
About West High Yield
West High Yield is a publicly traded junior mining exploration and development company focused on the acquisition, exploration, and development of mineral resource properties in Canada with a primary objective to develop its Record Ridge magnesium, silica, and nickel deposit using green processing techniques to minimize waste and CO2 emissions.
The Company's Record Ridge magnesium deposit located 10 kilometers southwest of Rossland, British Columbia has approximately 10.6 million tonnes of contained magnesium based on an independently produced National Instrument 43-101 – Standards of Disclosure for Mineral Projects ("NI 43-101") Preliminary Economic Assessment technical report prepared by SRK Consulting (Canada) Inc. in accordance with NI 43-101.
Contact Information:
WEST HIGH YIELD (W.H.Y.) RESOURCES LTD.
Frank Marasco Jr., President and Chief Executive Officer
Telephone: (403) 660-3488
Email: frank@whyresources.com
Barry Baim, Corporate Secretary
Telephone: (403) 829-2246
Email: barry@whyresources.com
Cautionary Note Regarding Forward-looking Information
This press release contains forward-looking statements and forward-looking information within the meaning of Canadian securities legislation. The forward-looking statements and information are based on certain key expectations and assumptions made by the Company. Although the Company believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because the Company can give no assurance that they will prove to be correct.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: general economic conditions in Canada and globally; industry conditions, including governmental regulation; failure to obtain industry partner and other third party consents and approvals, if and when required; the availability of capital on acceptable terms; the need to obtain required approvals from regulatory authorities; and other factors. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. The Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable law.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States. The securities of the Company will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") and may not be offered or sold within the United States or to, or for the account or benefit of U.S. persons except in certain transactions exempt from the registration requirements of the U.S. Securities Act.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
West High Yield (W.H.Y.) Resources Ltd. Announces Grant of Stock Options
West High Yield (W.H.Y.) Resources Ltd. (TSXV: WHY) ("West High Yield" or the "Company") is pleased to announce that its board of directors approved and authorized the grant of 375,000 stock options (the "Options") to two consultants of the Company effective November 27, 2023.
The Options were granted in accordance with the terms of the stock option plan of the Company. One (1) Option entitles the holder thereof to purchase one (1) common share of the Company (each a "Share" and collectively, the "Shares") at a price of CAD$0.23 per Share for a period of five (5) years from the Option grant date. One-third (1/3) of the Options vested on their date of grant, one-third (1/3) of the Options will vest on the date that is one (1) year from their date of grant and one-third (1/3) of the Options will vest on the date that is two (2) years from their date of grant. The exercise price of the Options was set at CAD$0.23 per Share, being the closing trading price of the Shares on November 27, 2023.
About West High Yield
West High Yield is a publicly traded junior mining exploration and development company focused on the acquisition, exploration, and development of mineral resource properties in Canada with a primary objective to develop its Record Ridge magnesium, silica, and nickel deposit using green processing techniques to minimize waste and CO2 emissions.
The Company's Record Ridge magnesium deposit located 10 kilometers southwest of Rossland, British Columbia has approximately 10.6 million tonnes of contained magnesium based on an independently produced National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") Preliminary Economic Assessment technical report prepared by SRK Consulting (Canada) Inc. in accordance with NI 43-101.
Contact Information:
WEST HIGH YIELD (W.H.Y.) RESOURCES LTD.
Frank Marasco Jr., President and Chief Executive Officer
Telephone: (403) 660-3488
Email: frank@whyresources.com
Barry Baim, Corporate Secretary
Telephone: (403) 829-2246
Email: barry@whyresources.com
Cautionary Note Regarding Forward-looking Information
This press release contains forward-looking statements and forward-looking information within the meaning of Canadian securities legislation. The forward-looking statements and information are based on certain key expectations and assumptions made by the Company. Although the Company believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because the Company can give no assurance that they will prove to be correct.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: general economic conditions in Canada and globally; industry conditions, including governmental regulation; failure to obtain industry partner and other third party consents and approvals, if and when required; the availability of capital on acceptable terms; the need to obtain required approvals from regulatory authorities; and other factors. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. The Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable law.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States. The securities of the Company will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") and may not be offered or sold within the United States or to, or for the account or benefit of U.S. persons except in certain transactions exempt from the registration requirements of the U.S. Securities Act.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
Click here to connect with West High Yield (TSXV: WHY), to receive an Investor Presentation
How to Invest in Magnesium
With important roles in healthcare and industrial applications, magnesium is worthy of investor consideration.
Not to be confused with manganese, which is also crucial for the development of a healthy body, magnesium, along with sulfur and calcium, is one of three secondary plant nutrients found in abundance on land and in water.
Necessary for over 300 biochemical reactions, magnesium is deemed vital for healthy bones and good circulation. Magnesium oxide is produced when magnesium and oxygen combine, and is commonly used in heartburn and indigestion remedies.
Magnesium metal plays a key role in various industrial applications. The metal is 40 percent lighter than aluminum, but as strong as steel, making it crucial for strengthening aluminum alloys.
Magnesium alloys can be found in airplanes, automobile parts and in electronic devices that benefit from being lightweight. Magnesium is also used to remove sulfur when iron and steel are produced and to inoculate cast iron. Magnesium carbonate salts are primarily used in calcining, as well as in the agricultural and construction sectors.
Magnesium’s wide array of high-tech applications make it a compelling investment, but it's often difficult for investors to find information about the magnesium metal market. Here’s a quick overview of magnesium industry supply and demand dynamics, as well as a brief introduction to investing in magnesium.
What drives magnesium supply and demand?
Demand for magnesium has grown steadily in recent years, driven largely by the car parts industry, where magnesium is used for die casting. Specifically, magnesium can be found in components like car steering wheels and support brackets.
According to IndustryARC, the compound annual growth rate in the global magnesium metal market is expected to average 6.7 percent between 2022 and 2027 to reach US$7.5 billion. In the forecast period, the firm expects magnesium alloys to display stronger market growth over more traditional uses such as steel desulfurization. This is mainly due to environmental pressures as vehicle makers view alloys as a means of reducing vehicle weight and, in turn, emissions.
China is experiencing the greatest growth in market share compared to the rest of the world. The country is the world’s largest vehicle market, and the Chinese government has predicted that its automobile output will reach 35 million units by 2025.
In terms of supply, magnesium is the eighth most abundant element in the Earth’s crust and the third most abundant element dissolved in ocean water. Around 87 percent of magnesium production in the world comes from Chinese mineral deposits. Other major high-purity magnesium-producing countries include Israel and Russia; Russia also holds the highest magnesium compound reserves in the world at 2.3 million metric tons.
How to invest in magnesium stocks?
As with many other critical metals, there is no formal magnesium market. For that reason, it is difficult to gain exposure to the metal. However, one way to do so is to invest in magnesium resource companies.
A few options are below; all companies are listed on Canadian, US and Australian exchanges:
- Inomin Mines (TSXV:MINE)
- Latrobe Magnesium (ASX:LMG)
- Karnalyte Resources (TSX:KRN)
- Korab Resources (ASX:KOR)
- Magontec (ASX:MGL)
- MGX Minerals (CSE:XMG,OTC Pink:MGXMF)
- Western Magnesium (TSXV:WMG,OTCQB:MLYF)
- West High Yield Resources (TSXV:WHY,OTC Pink:WHYRF)
This is an updated version of an article originally published by the Investing News Network in 2011.
Don’t forget to follow us @INN_Resource for real-time news updates!
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Inomin Mines and West High Yield Resources are clients of the Investing News Network. This article is not paid-for content.
West High Yield Exec Says More Secure Magnesium Supply Chain Key to Decarbonization
Manufacturers and governments are increasingly looking to secure alternative magnesium supply as geopolitical events raise concerns about the potential instability of current supply chains.
“Magnesium is one of the identified critical minerals, or metals that you may have read about in recent news the last couple of years, and it's very much come to the forefront with all of the geopolitical froth going on in the world,” said Barry Baim, director and corporate secretary at West High Yield Resources (TSXV:WHY), which is currently developing its advanced-stage Record Ridge magnesium project in BC.
“Eighty-five percent of the critical mineral is produced in China, another 8 to 10 percent in Russia. So given what's going on today in the world, many manufacturers and countries are looking for secure supplies,” he added.
Magnesium has a wide range of applications, including in pharmaceuticals, healthcare and biomedicine, as well as in the transportation sector. The critical mineral is also being developed for use in magnesium-based batteries, as an alternative for current battery chemistry.
“Magnesium is a critical mineral that is key to this whole net zero by 2050, the decarbonization of our planet, and it underpins modern society,” Baim said.
Watch the full interview with Barry Baim, corporate secretary and director at West High Yield Resources.
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10 Top Countries for Magnesite Mining
Magnesite, an industrial metal, plays a key role as a refractory material in steel fabrication, as a catalyst and filler in the production of synthetic rubber and as a material in the production of magnesium chemicals and fertilizers.
The global magnesite market had an estimated value of US$3.8 billion in 2022, and is projected to reach US$4.5 billion in 2030 on rising demand from the construction, chemical, metallurgical and automotive industries.
The US Geological Survey estimates that worldwide magnesite resources stand at 13 billion metric tons (MT). Worldwide, magnesite production reached 27 million MT in 2022, down from 29 million MT in the previous year.
While Russia dominates in terms of magnesite reserves, China leads the world in magnesite production. Here the Investing News Network looks at the top countries for magnesite mining.
1. China
Mine production: 17 million MT
China is the world's top country for magnesite mining by far, accounting for roughly 63 percent of worldwide output. The country's production decreased slightly last year compared to 18 million MT in 2021. The Asian nation is also the principal exporter of the material to the US and many other markets across the globe.
China also represents a major market for magnesite in its own right, accounting for about 65 percent of total global consumption. However, strict environmental regulations in the country have resulted in the closure of several key magnesite mines.
2. Australia
Mine production: 2.6 million MT
Australia's magnesite production has risen steadily in the past few years, moving it up from near the bottom of the list of top magnesite-mining countries to the second spot. In 2022, the nation recorded a slight decrease in magnesite-mining output — its production fell to 2.6 million MT from 2.7 million MT the previous year.
Private company Queensland Magnesia is responsible for the bulk of Australia's magnesite production. Some examples of magnesite-focused junior mining companies operating in Australia are Korab Resources (ASX:KOR) and Volatus Capital (CSE:VC).
3. Turkey
Mine production: 1.8 million MT
Next is Turkey, whose magnesite output came to 1.8 million MT in 2022, just 100,000 MT fewer than it produced in 2021. Magnesite production in the country has significantly decreased in recent years, falling from 2.7 million MT in 2017.
Turkey has a long history of magnesite mining, both for export and for use at domestic refractories. Akdeniz Mineral Resources, a joint venture with private company Grecian Magnesite, is a large producer and exporter of caustic calcined magnesite products.
4. Brazil
Mine production: 1.5 million MT
Brazil's magnesite production has remained relatively flat in recent years, although 2022 production levels decreased by 100,000 MT over 2021. A critical point in Brazil's magnesite industry came in 2017 with the merger of RHI of Austria and Magnesita Refratários of Brazil to form RHI Magnesita, which then became the world's largest refractory materials producer. RHI Magnesita is also reported to own the largest magnesite reserve outside of China.
5. Russia
Mine production: 950,000 MT
Russia's magnesite-mining output has dropped significantly in recent years, sinking from 1.5 million MT in 2020 to 950,000 MT in 2022. The country hosts the largest reserves of magnesite in the world, coming in at 2.3 billion MT.
One of the key players in the Russian magnesite space is Magnezit Group, which is actively working to expand production capacity at its Kirgiteiskoye and Talskoye deposits by overhauling existing facilities and building new facilities.
6. Austria
Mine production: 800,000 MT
Austria's magnesite mining output has remained relatively flat in recent years, with levels in a range of 760,000 MT to 800,000 MT. Austrian magnesite producer Styromag operates five mines in the country; it produces roughly 120,000 MT of material per year.
7. Spain
Mine production: 620,000 MT
Spain's magnesite output has more than doubled since 2016, coming in at 620,000 MT in 2022. Spain's Magnesitas Navarras is a leading European magnesia producer.
8. Greece
Mine production: 510,000 MT
Greece produced 510,000 MT of magnesite in 2022, a decrease of 40,000 MT from the year before. The country is home to one of the top magnesia producers in the world, Grecian Magnesite, which has facilities in Spain, Turkey and the Netherlands. Greece's magnesite mines and production facilities are located in the Chalkidiki peninsula in Northern Greece.
9. Slovakia
Mine production: 480,000 MT
Slovakia produced 480,000 MT of magnesite in 2022, a slight decrease of 20,000 MT versus what it produced a year earlier. Slovakian producer SLOVMAG is majority owned by Russia's Magnezit Group. It specializes in mining magnesite ore and producing refractory products from sintered magnesia.
10. Iran
Mine production: 190,000 MT
Rounding out the list, Iran put out 190,000 MT of magnesite in 2022, down by only 10,000 MT from the previous year. Magnesite ores are widely distributed in Iran, with significant resources in the provinces of East and West Azarbaijan, Hamedan, Kermanshah, Fars, Kerman, Semnan and Sistan-Baluchestan.
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Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
West High Yield: Developing a Strategic Critical Minerals High-Grade Magnesium Project with Near-Term Production
West High Yield (TSXV:WHY) focuses on critical minerals with a high-grade magnesium project nearing production. The company’s Record Ridge property will soon capitalize on the opportunity to create a new supply of magnesium outside of China and Russia. West High Yield has an experienced management team ready to bring its project to production.
The 100 percent owned Record Ridge project in British Columbia is poised to create a secure, strategic domestic supply chain to cater to North America’s magnesium demand. The company is currently awaiting permits to begin production. Once production commences, West High Yield will begin generating cash flow through the sale of ore and seek new offtake agreements.
The Record Ridge asset has one of the largest and highest-grade magnesium deposits in North America, and globally. The company’s resource estimate shows 43 million tonnes of ore at 24.6 percent magnesium, which implies it is a world-class asset containing 10.6 million tonnes of magnesium. In addition, West High Yield’s pre-feasibility study indicates strong economics with an after-tax NPV of 5 percent of $872 million, an internal rate of return (IRR) of 72 percent over a 172-year mine life, and payback in 1.5 years.
Company Highlights
- West High Yield is an exploration and development mining company focusing on its advanced-stage magnesium asset nearing production.
- The company’s flagship Record Ridge asset has the potential to strengthen the secure critical mineral on-shore North American magnesium supply chain and reduce dependence on China and Russia’s production.
- Magnesium is used throughout several verticals, such as aerospace, clean energy and pharmaceuticals.This multiple application critical mineral continues to widen the gap between growing demand and dwindling supply creating an opportunistic tailwind for WHY Resources and the development of the Record Ridge Project.
- Record Ridge is currently awaiting a mining permit before beginning construction.
- West High Yield has completed a pre-feasibility study indicating robust economics that encourages the company to move forward.
- The company prioritizes clean energy operations to reduce emissions and ensure a positive ESG rating, creating a low cost high-pedigree magnesium product and results in virtually no CO2 emissions.
- An experienced management team leads the company toward fully realizing the potential of its assets.
This West High Yield profile is part of a paid investor education campaign.*
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