Critical Minerals Roundtable

Evaluating the Secular Bull Market

Earlier this month, Grizzle hosted the latest installment of our Critical Minerals Roundtable. We brought together a great lineup of executives and strategists to dissect the secular bull market forming across strategic metals. If there was one takeaway that cut through the noise, it is that the global energy transition, AI data center build-outs, and decades of mining underinvestment are triggering a massive supply-demand reckoning.

We analyzed the sheer scale of the copper crisis, exploring how the world must mine more copper over the next 25 years than in all of recorded human history just to keep pace with AI infrastructure and global electrification. The insights extended across the strategic spectrum: we unpacked the significant industrial deficits keeping silver in a structural shortfall, and the urgent bottlenecks facing US uranium independence.

Navigating the tension between terminal brownfield depletion and the severe lag in bringing new greenfield projects online, we believe the current entry points for high-quality critical mineral assets offer a great combination of structural growth and deep value. We look forward to sharing these session notes with you, as these dynamics are going to be critical for navigating the markets in the months ahead.

Speakers:

◼️Anfield Energy (TSXV:AEC) (NASDAQ:AEC) - Corey Dias, CEO
◼️Ecora Royalties (TSX:ECOR) (LSE:ECOR) - Kevin Flynn, CFO
◼️Hilltower Resource Advisors - Tracy Schuchart, Founder
◼️Hot Chili (TSXV:HCH) (ASX:HCH) - Christian Easterday, CEO
◼️Aftermath Silver (TSXV:AAG) (OTCQX:AAGFF) - Michael Williams, Chairman

Anfield Energy: Positioning for the Nuclear Renaissance

• The Nuclear Imperative: Nuclear power is increasingly recognized as a critical source of low-cost, baseload power capable of sustaining global populations. With roughly 440 reactors currently operating worldwide, a massive pipeline of 70–80 proposed reactors and another 200+ under consideration suggests a potential doubling of global nuclear capacity.

• The Uranium Supply Deficit: The mining sector is currently undersupplied and lacks the growth prospects to meet even current demand. The US, which possesses the world’s largest reactor fleet, produces only about 5% of its required uranium, leaving it heavily dependent on geopolitically risky jurisdictions like Russia, Kazakhstan, and Uzbekistan. Even at full capacity, existing US processing facilities could only meet roughly 50% of domestic demand.

• Uranium Prices and the “Tipping Point”: Despite current term prices around $85–$86, these levels are insufficient to incentivize the launch of new mining projects. Anfield believes “triple-digit” prices are necessary to bring marginal projects online. The market is currently driven by slow and steady utility reentry, but Anfield expects a potential “panic” as aggressive RFPs reveal the true depth of the supply-demand imbalance.

• Managing Costs at the Shootaring Canyon Mill: To mitigate inflationary pressures, Anfield has moved away from third-party contractors—who carry heavy margin requirements—and toward an in-house team. This transition has allowed the company to be more granular with project requirements and effectively control costs during the rebuild process.

• Financing and Government Support: Anfield is exploring a 30% equity / 70% debt financing mix for its projects. Management is actively pursuing non-traditional sources, including potential low-interest loans from the US Department of Energy (DOE) earmarked for processing facilities, and Department of Defense (DOD) grants for mining assets.

• Permitting and Mill Optionality: The company is aggressively advancing its permits, with the radioactive materials license for the mill expected by the end of 2026. Anfield’s mill is designed with significant flexibility; while it can process material from the company’s internal portfolio (including JD8, SM18, and SlickRock), the mill capacity also allows for toll-milling third-party material.

• Operational Milestones: Near-term catalysts include the decommissioning of unused mill equipment to facilitate refurbishment, obtaining the radioactive materials license, and securing mining permits (Plans of Operations) for the JD8, SM18, and SlickRock mines.

Ecora Resources: Building a Future-Facing Royalty Portfolio

• Copper Supply-Demand Fundamentals: Ecora maintains a bullish outlook on copper, driven by the structural mismatch between growing electrification demand and the increasing difficulty of permitting and bringing new mines online. Supply disruptions from major producers have bolstered prices in the short term, but more importantly, the “incentive price” required to bring new supply online has risen due to inflation. The royalty model is particularly effective in this environment because it operates on a nominal basis, allowing investors to participate in higher price environments without being penalized by capex or inflationary cost drags.

• Critical Minerals Opportunity Set: While critical minerals are core to Ecora’s strategy, the company avoids branding itself as an “EV-only” shop. Instead, their portfolio is built around the broader theme of “electrification,” which encompasses how energy is produced, stored, and used. While the company retains base metals as a core component, it has deliberately diversified into niche areas like vanadium, rare earths, and nickel to ensure low earnings volatility.

• Macro Drivers: Beyond electrification, Ecora views defense spending as a major, under-invested macro driver. Western governments are increasingly focused on securing supply chains for critical minerals to support defense needs, and Ecora expects this trend to remain a key pillar of long-term demand.

• Ecora’s Royalty Portfolio: The company distinguishes itself by focusing outside of the well-served precious metals market. Today, 50% of its Net Asset Value (NAV) is in copper, and over 80% is in base metals. A key pillar of the portfolio is quality: 80% of assets sit in the first or second quartile of the cost curve, which is critical for resilience through commodity cycles. Furthermore, 50% of the portfolio is currently in production, providing immediate torque to spot prices rather than relying on long-term price assumptions.

• Evolution of the Royalty Industry: Over the last 14 years, the industry has shifted from royalties being perceived as a “financing of last resort” to a mainstream, sophisticated component of capital structures. Even mining majors like BHP are now utilizing streaming transactions, validating the model’s utility.

• Lifecycle & Valuation Catalysts: Ecora is currently in a growth phase, using its cash-generative royalty base to de-lever and invest in new deal flow. Key catalysts for the next 12 months include the continued production ramp-up at Voisey’s Bay and Mimbula, and the roll-off of private area assets like Kestrel, which will lead to a more visible, long-term production profile that can be measured in decades rather than years.

Hot Chili: Solving the Copper Scarcity Crisis

• The Copper Supply/Demand Reality: The world is approaching a state of copper scarcity that will likely drive prices to historic highs. To meet demand projections—which expect a 50% increase by 2050—the world must mine more copper in the next 25 years than humans have mined since the Bronze Age. Demand is no longer cyclical; it is policy-driven (AI, defense, electrification), meaning end-users are price-takers who will absorb higher costs to secure supply.

• The “Inertia” of Major Producers: The industry’s supply response has been muted for years due to declining ore grades and aging deposits. While majors have focused on “brownfield” expansions to mitigate risk, these are becoming prohibitively expensive, with some reaching capital intensities of mid-$20,000 per annualized ton. This has created a “tipping point” where majors must pivot back to cost-effective greenfield developments.

• Gamechanger: The La Verde Discovery: La Verde is a recent, high-grade discovery that acts as a major economic lever for Hot Chili’s flagship Costa Fuego project. With recent drill results including wide, high-grade intercepts (e.g., 61m at 1% CuEq), La Verde is expected to significantly reduce payback periods and boost NPV and IRR by providing high-grade feed for the front end of the mine plan.

• Drilling Catalysts Ahead: Hot Chili is currently running an intensive drilling program with 22 holes awaiting assay results due to lab backlogs. These results will culminate in a maiden resource for La Verde by the end of 2026, which is expected to be material to the company’s 1-billion-ton resource base and potentially extend the mine life of Costa Fuego from 20 to 30 years.

• Understanding Valuation Dynamics: While M&A activity among majors is cooling, the focus has shifted toward securing “meaningful bolt-ons”. Trading significantly below the 0.5x–0.7x PNAV valuation range supported by current M&A environments, Hot Chili sees a clear path to a re-rate as they integrate La Verde and demonstrate the economic upside of the Costa Fuego hub.

• The Huasco Water Project: Beyond copper, Hot Chili holds a highly strategic maritime license for desalination. In the water-scarce Atacama region, where mining projects can no longer draw from underground aquifers, Hot Chili’s ability to supply desalinated water to its own projects—and potentially to neighboring regional clusters—is a significant, untapped value proposition for the company.

Tracy Shuchart: The Copper Supply-Demand Mismatch

• The Copper Supply-Demand Math: We are currently consuming 28 million tons of copper annually. Projections from S&P Global and BHP suggest demand will climb to 42–50 million tons by 2040–2050. To meet this curve, the world must mine more copper in the next 25 years than humans have mined in total recorded history since the Bronze Age.

• Key Demand Drivers: Demand is no longer solely tied to traditional construction; it is being driven by five converging, policy-backed vectors that are price-inelastic:

  • Traditional Industrial Growth: Urbanization in India, Southeast Asia, and Africa, including the addition of two billion air conditioners by 2040.

  • Energy Transition: Transmission and distribution infrastructure is expected to see $7.5 trillion in cumulative investment through 2040.

  • EV Penetration: Modern EVs require 2.9 times more copper than internal combustion engine vehicles, with the sector seeing massive incremental growth.

  • AI & Data Centers: Beyond power grid expansion, data centers require vast amounts of internal copper wiring and specialized cooling systems.

  • Defense: NATO’s pledge for 5% GDP defense spending is fueling demand for naval shipbuilding, hypersonics, and hard communications.

  • Humanoid Robotics: Modest adoption by the late 2030s could add another half-million tons of annual demand.

• The Supply and Discovery Drought: While demand explodes, supply has collapsed over the past 12 months. World-class producers are struggling: Codelco is producing less copper than it did in 1997, and major players like Freeport, Ivanhoe, Anglo-American, and Glencore have all faced production cuts due to seismic events, mud rushes, and declining ore grades. Consequently, over 1.6 million tons of supply that consensus modeled for 2026 will not materialize. Furthermore, major copper discoveries (deposits >500k tons) are at record lows, with three of the past four years delivering zero new major finds.

• Resolving the Mismatch: Traditionally, high prices led to demand destruction (”Dr. Copper”). Today, demand is policy-driven and price-inelastic; AI, defense, and electrification mandates will proceed regardless of cost. Because scalable substitutes like aluminum do not effectively replace copper’s conductivity and utility, the only resolution to this structural deficit is significantly higher prices.

Aftermath Silver: Silver’s Industrial Transformation

• Silver’s Industrial Transformation: Silver is currently in a structural deficit, with demand consistently outstripping supply by 40–60 million ounces annually. While historically viewed as a financial asset, its industrial usage has climbed to 65% of total demand. As the most conductive metal on the planet, silver is now a critical component in aerospace, high-efficiency EV electronics, defense systems, and the explosive growth of AI data centers.

• The Silver Scarcity Dilemma: Silver is exceptionally difficult to bring into production because 70% of global supply is a byproduct of copper, lead, or zinc mining; there are very few “pure-play” open-pit silver opportunities. Furthermore, exploration success is at a record low: since 1990, the industry has discovered 220 copper deposits, but only 10 in the last decade. This supply inertia is creating a long-term setup for elevated metal prices.

• The Manganese Value Add: Aftermath Silver’s flagship Berenguila project in Peru contains a unique, high-quality “oxide” manganese. This specific type of manganese is increasingly vital for EV battery chemistries (like LFP and nickel-cobalt-manganese batteries), where it acts as a “doping” agent to increase cycle life and efficiency. Furthermore, it serves as a cheaper, more ethically sourced alternative to cobalt, which is largely controlled by jurisdictions prone to human rights concerns.

• Project Roadmap & Tier-1 Status: Aftermath has bypassed a Preliminary Economic Assessment (PEA) to head straight for a Pre-Feasibility Study (PFS), which is slated for release in Q1 of 2027. Williams categorizes Berenguila as a “Tier-1 asset,” defined by its ability to remain robustly economic even in a “bad” market environment.

• Near-Term Catalysts: The company is executing an aggressive drill program at Berenguila. Key follow-ups include drilling the high-grade Eastern targets—where they previously hit 157 meters of 1.12% copper and 290g/t silver—and testing a separate “skarn” mineralization target four kilometers away. These results, alongside the upcoming PFS, are expected to be the primary drivers for a company re-rating.