Mont Royal Resources (ASX:MRZ) - 'Undervalued?' Investment series, with Nicholas Holthouse

Nick Holthouse (0:00)

Hi, everyone. My name is Nick Holthouse. I'm the Managing Director of Mont Royal Resources. It's a great pleasure to be here with Matthew on this Crux Interview, talking about undervalued projects. We certainly see Ashram as one of the key North American assets yet to come to market. However, we have a market cap, which certainly doesn't reflect that story. So we are very much looking forward to taking you through some of the reasons why we think Ashram is undeveloped. I'm sorry.

We are very much keen on taking you through the story to show you why we think that the Ashram deposit remains undervalued. Some of the steps that are going forward, which we think are going to take this project forward and really let it sit amongst its peers where it should be when you look at the quality, the resource, probably the metallurgy and the government support that we're getting.

Matthew (0:59)

Nick, good to have you on the show. Looking forward to this conversation.

You're literally answering that one question. Are you undervalued? And if so, I need to know why you think that and why I should think that. So you're going to rip through a presentation, if you don't mind. I'll lob in questions as we go along, if I don't understand anything. So over to you.

Nick Holthouse (1:19)

Thanks very much, Matthew. Just quickly to start off, this is a bubble chart that really shows Contained TREO, okay? So it's a fairly blunt sort of comparison tool. There's lots of other ways we can slice and dice this, but as you can see, ASHRAAM, with regards to Contained TREO with its current resource, certainly sits amongst some of the more well-known projects in the rear of the space. Certainly, when you look at the size of the contained resource, we're certainly up there with regards to Lydus and MP, Meteoric Resources, recently in the news with Lydus, and the soon to come to market Lydian Resources as well. So it certainly has the goodies.

It has a really good deportment of Neodymium praseodymium, super important in the Magnet space. It's got a nice tenor of DYTB. It's got a good content of Utre, which is a super important element, particularly in the market at the moment, with geopolitics playing out. That's become an oxide of, or an oxide that's certainly being chased amongst industry. And yeah, we certainly have a good deportment of that. So Ashram, nice, large tenor of TREOs, a really attractive basket, and sitting in that North American space, undeveloped.

Matthew (2:43)

Okay, so scale, 30 year life of mine, it's going to be hard for investors to put too much value on beyond 30 years at this stage. Is it the mineralogy and the metals themselves, that's going to determine valuation for you going forward?

Nick Holthouse (3:03)

No, it certainly shouldn't be something that people look at. In fact, the mineralogy is actually really favourable. It's one of the things that attracted me to the project, Matthew.

Most rare projects, unfortunately, don't work. It's just the way Mother Nature has played the story out. There's complicated minerals, which require complex processing flow sheets, or they just don't recover at all.

But the thing that really attracted me to Ashland, aside from the scale and the basket, is the fact that the metallurgy works extremely well. So we do produce a very good quality concentrate. We've got ongoing flotation work, but at the moment, the numbers that we use were quite conservative. But 30% concentrate, 63% recovery to that concentrate. Now, that's the first important step. If you can do that, you are off to the races, so to speak, with regards to going further downstream with a product that can be evaluated. So this project absolutely does that. We've really lifted the hood. We've exposed what we see as a really solid metallurgy story within this project. We've got a very simple flotation story to get to that all-important first stage concentrate. So metallurgy is certainly something that investors should be concerned about in any way, shape or form. It really works exceptionally well, and it's very simple. Moving on, where do we sit with regards to value, particularly in the PNAV space without our NPV of 2.2 billion, and the current market cap that we have. I've just used market cap to measure this metric. As you can see, we are well under anything else in this part of the world. In the North American space, and we probably are sitting at the bottom of the heap, unfortunately, for projects around the world. So there is a huge opportunity here, and that is the message that we really are trying to get out. There's lots of projects out there. This has really favorable met.