Defense Metals Has U3O8 and REOs
I enjoy going back referring to articles about companies that I have written about before. Contrary to how 90% of other writers handle it, every article I have ever posted is still on my site. Granted on a regular basis I report on a company that then turns around and blows up but error in forecasting happens to anyone who is honest. It’s only the crooks that claim to get every call right.
But even a blind squirrel. . .
I’ve been writing about Defense Metals (DEFN-V) for years and pretty much gotten it right. The stock hasn’t shot higher, as a silver or gold company probably would have, given their excellent results but the shares are higher. In one piece, I think it was the last piece I did on them, written in May of 2020 I spoke of the Covid hysteria as fraud. Now we know it was fraud from the gitgo and I predicted the numbers put out by governments were utter nonsense.
Defense Metals has two directions they can go in. I really hope they don’t try both at the same time. No company ever succeeds at that. But they have two company making projects. The one that investors know best is the Wicheeda REE deposit with a 43-101 of about 17 million tonnes of about 3% REOs. At today’s prices, that is worth something greater than $6 billion in the ground. That should be worth something but investors only value DEFN at about $21 million today.
That’s going to change soon when investors wake up to some actions on the part of the Chinese government who may as well be at war with the West already. China produces 70% of all REE today. As such they are the swing producer and have spent thirty years gaining total control of the market. But controlling the price as they have succeeded in doing also allows controlling the supply. For Defense Metals that may spell opportunity.
Last week China announced plans to create two REE mining giants. One to dominate the light rare earths and the other to control the medium to heavy REE. Given that China already totally controls pricing for REE, the latest move is aimed at creating a noose on the supply of REE.
The primary use for rare earths is in the manufacture of high performance magnets for electric vehicles. If China manages to tighten their stranglehold on the supply of magnets for EV, auto companies will find themselves in a similar situation where chip shortages in the industry have cost companies production of 7.7 million vehicles and $210 billion in revenue for this year alone.
The west took a short-term advantageous and long-term disastrous approach in handing manufacturing over to China. And now we want to add them to a very long list of enemies. There will be a giant price to pay for our stupidity.
Defense Metals is in a perfect position to offer the governments of the US and Canada a safe source of LREOs. It will require government financial help. It would be penny wise and pound-foolish if both governments didn’t do something to guarantee a supply of these critical metals. We have already killed the chip industry in the US. Remember when the area around San Jose was called Silicon Valley? Now the best term for the San Francisco area and California in general is shit hole. We have gone from having the greatest technology capitol in the world to having a cesspool filled with crack addicts and terrorists.
Defense Metals has a drill program in progress. Last week they announced a drill intercept of 215 meters of carbonatite, the longest in company history. A couple of days later they announced an interesting press release about their backup uranium projects in the Athabasca Basin. The company hasn’t said a word about their projects for U3O8 in years but they have five different claims in the center of the Athabasca Basin, the Saudi Arabia of uranium.
Eric Sprott is hot on two commodities, silver and uranium. He has invested billions of his own money into various companies. He was a primary investor in New Found Gold long before they went public. That is just one of a whole line of gold companies he has put money into in Newfoundland. He’s doing the same thing with uranium.
Defense Metals is a rare earths company with a six billion dollar project that screams to be put into production. It would make all the sense in the world for either the Canadian or the US government or both to help put the Wicheeda REE project into production. It would help safeguard the few remaining bits of auto manufacture that we haven’t shipped overseas.
It would also be a giant move forward for DEFN to do some sort of option with any one of the dozen or so companies interested in U3O8 in the Athabasca Basin. Defense Metals is higher now than when I first started writing about them but they are still absurdly underpriced.
I have participated in several private placements in DEFN and bought shares in the open market. I am biased. In addition they are advertisers so naturally I am biased. As always do your own due diligence.
Defense Metals Corp