Firebird Metals (ASX: FRB): Interview with CEO Peter Allen

 

Firebird Metals (ASX: FRB)

We spoke with Peter Allen, CEO of Firebird Metals (ASX: FRB) about the favourable long-term outlook for manganese and how that benefits the company’s Oakover Manganese Project at Newman in northern WA.

We talked about the solid economics for the concentrates scoping study and the upcoming study on battery grade manganese sulphate.

Full transcription below.

 

Investing on ASX?

 

Stocks Down Under Concierge gives you timely BUY and SELL alerts on ASX-listed stocks!

 

GET A 3-MONTH FREE TRIAL TO CONCIERGE TODAY

 

No credit card needed and the trial expires automatically.

 

 

 

Transcription

 

Stuart: Hello, and welcome to “Stocks Down Under.” My name is Stuart Roberts, and I’m one of the co-founders of our service. And joining me on Wednesday, the 19th of July, 2023 from Perth is Mr. Peter Allen, who’s the CEO of Firebird Metals, ASX: FRB. Peter, good morning.

Peter: Good morning, Stuart. Great to see you.

Stuart: So, Peter, I like to joke that if I ever see your car, it’s got the number plate 25 on the back. You are probably Australia’s leading authority on manganese, element number 25, given since about 2,000, that’s the only commodity that you’ve dealt with in the various companies you’ve worked with. Tell us about your background before Firebird Metals.

Peter: Well, principally, I’ve been involved in manganese now for like 23 odd years. A large chunk of that was with a company called Consolidated Minerals, which owns Woodie Woodie manganese mine, Ghana manganese mine. I was in charge of marketing and logistics for about four million tons of sales. I’ve been involved with lots of other manganese deposits, you know, like, around the world like in Africa, Europe, Brazil, and Indonesia, and sort of spent my whole life working around how to develop manganese, how to value it, how to sell projects.

Stuart: Right. And now you get the chance with Firebird to work on a major manganese deposit in a tier-one jurisdiction. Talk to us about Oakover, a way up near Newman in Western Australia.

Peter: Oakover is a fantastic little deposit. It’s 85k east of Newman. We’ve got a job resource of 176 million tonnes…

Stuart: That’s big, right, by manganese standards?

Peter: Definitely big. You know, I think the key to remember with Oakover is some people will look at it as quite low-grade in the ground. And that’s true, it’s 10% manganese, but 40% silica. And by simple crushing, screening, scrubbing, and beneficiation, you remove the silica, you pull up the manganese, and you end up with a very saleable manganese product like the steel industry of, you know, 35% manganese. And then that’s an ideal feedstock for high-purity manganese sulfates to go into factories.

Stuart: Right. And we’ve some idea what this deposit is worth because you’ve recently completed a scoping study on just producing concentrates. And there’s some good economics there, but you’re now gonna recut the numbers on the high-purity sulfate stuff. And I suspect that the numbers, they will be coming sooner rather than later.

Peter: Correct. Yeah, we’re expecting to answer the [inaudible 00:02:35.379] sulfate scoping study in Q3. It’s progressing nicely. We’ve been working on it now for a few weeks, and it’s looking very good.

Stuart: Right. So one of the things that I think is holding your stock back is investors might know iron ore, but they don’t really understand manganese, which is strange given BHP and then South 32 had Groote Eylandt for a long while. And there’s Jupiter Mines out there with Tshipi Borwa. What’s going on? Why are investors so dumb when it comes to manganese?

Peter: Well, it’s been one of those control long time, my whole career almost. Manganese is not as transparent as cobalt or iron ore. So it’s a little bit harder for some investors to follow. But I think two golden rules, you know, manganese is unsubstitutable in steel, that every time steel produces 1% to 2% of manganese. But even more important on that, manganese is growing in importance and in use in batteries. And we’re going to see some real exponential growth in consumption of high-purity manganese sulfate in batteries.

Stuart: Right. And the reason for that is it’s a relatively inexpensive metal compared to cobalt. So you can keep the energy density but lower your cost of batteries. That’s the basic theme here, right?

Peter: Correct. And it also does increase the capacity of the battery as well. So you can get more out of the battery by adding manganese into it. But it’s principally the cost. Like on a nickel-based battery, an NMC 622, you know, manganese is 70% of its weight by volume, but it’s only less than 2% of its cost. So when you compare that to nickel and cobalt, you can really see why car manufacturers like Volkswagen, Stellantis, and Tesla have all said, “Look, we’re going to start looking to produce manganese-rich nickel-based batteries.” So diminish the cobalt, increase manganese content, you don’t lose any of the characteristics and you save a whole lot.

Stuart: Right. So how much more complicated is it to go from producing concentrates to producing high-purity sulfates?

Peter: Well, it is a chemical process that’s a little bit more complicated, but I’ve got some really good people working for me. We’ve understood the process. You know, my CFO and I, we’ve recently visited China as well. We’ve met high-purity manganese sulfate producers in China. We have a really good grasp of the process, what it takes, and the inputs required. So, yes, more complicated, yes, a bigger capex, but I reckon we’ve got it in hand.

Stuart: Right. Talk to us about some of the challenges you face. You’ve applied for a mining license, for example. It might take a while to get that done, but you’re at various stages of the process for environmental and other stuff.

Peter: Correct. We recognised early on that our problem, longest lead time will be the environmental service that we need to do. So we started those about a year ago. We’ve done all that baseline studies on flora, fauna, subterranean fauna, groundwater, groundwater desktop study. So we’ve got a really good grasp on what we’re doing. We’re well advanced on a number of those. You’ve got to spread them over two seasons to get the proper survey results for the EPA. But yeah, we’re well advanced. So we’re working our way through that. We’ve recognized that. We’re now looking to negotiate with the traditional owners and getting all our heritage permits and production records in place.

Stuart: Right. And Oakover is just the start of the story. You’ve got other projects that are in the portfolio as well. Talk to us about what comes after Oakover.

Peter: Yeah, we are principally a manganese player, but we’ve got a number of other key manganese deposits. I guess, you know, the first one that comes to mind is Hill 616. It’s like 35k south of Oakover. It also contains the inferred resource, 57 million tonnes. Completely, the records are 234 million tonnes of resources. And then recently, one that I’m really excited about is we picked up a project just south of Woodie Woodie manganese mine, up further north, a project called Wandanya. And that, I think, has real potential for a much higher-grade style of mineralization. So we picked that up last November, December. We’re going through the Heritage Agreement Access now. Get those surveys done in the near term and then we’ll get some drills done on that. And I think that will provide some really good results as well.

Stuart: Right. Well, Peter Allen, well done on what you and your colleagues have achieved at Firebird. It’s a great story. The legendary Tolga Kumova must think so because he’s still holding his 8% of the company. And that’s a great advertisement for you. Keep up the good work.

Peter: Well, we greatly appreciate Tolga. He’s been a great supporter over the years. And thanks for your time.

Stuart: Right. See you soon.