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Investor Insight

With a growing list of natural resources assets vital to growing global demand in the healthcare and technology sectors, VVC Resources presents an investment opportunity for investors looking to diversify their portfolios.

Overview

The global helium market is expected to increase from $4.45 billion in 2022 to $5.03 billion in 2023 at a compound annual growth rate of 12.9 percent driven by the growing demand for helium from the healthcare industry. Helium is important in medicine because this rare element is used in various ways, one of which is as a refrigerant capable of cooling the superconducting magnets in MRI scanners. This non-reactive, non-corrosive, non-flammable noble gas is not only used in diagnosis equipment but also as an adjunct therapy for certain diseases like COPD, asthma and bronchiolitis.

Although helium is the second most common element on earth, global helium supplies are running low. Resource companies that supply industries dependent on helium should explore potential helium reserves and evaluate data to come up with a unique strategy for increasing helium production.

VVC Resources (TSXV:VVC;OTCQB:VVCVF) engages in the exploration, development and management of natural resources – specializing in scarce and increasingly valuable materials needed to meet the growing, high-tech demands of industries such as manufacturing, technology, medicine, space travel and the expanding green economy.

The company’s portfolio includes a diverse set of assets and high-growth projects, comprising: helium and industrial gas production in the western US; copper and associated metals operations in northern Mexico; and strategic investments in carbon sequestration and other green energy technologies.

VVC currently targets helium reserves in the US by reactivating old gas wells and drilling new wells. In January 2022, the company engaged Foreland Operating to manage the day-to-day helium operations going forward. In March 2022, VVC announced the successful completion and connection of its first helium well in the Syracuse Project. The well, known as the Levens #2, was connected to Tumbleweed Midstream’s Ladder Creek Pipeline, which transports gas to the Ladder Creek Helium Processing Plant in Cheyenne Wells, Colorado. VVC further confirmed the presence of helium up to 1.14 percent from its second drilled well in the Syracuse Project.

VVC also acquired the Monarch Project to further capitalize on the growing demand for helium due to increased global usage. The Monarch Project consists of more than 1,700 acres of gas leases located in Greely County, Kansas with six existing wells. Minor repairs were made to five of the six wells, restoring electric power service, and began generating revenue from the natural gas and helium at low volumes. The focus of this project is the 14 additional potential well locations which are conveniently located for connection to the Tumbleweed pipeline.

VVC’s helium portfolio reached another significant milestone with the installation of 14 miles of its internal gathering system pipeline in the Syracuse Project. The major infrastructure will seamlessly transport gas produced by the company’s helium and natural gas wells to a nearby processing plant. The milestone increases the pipeline’s length from 7 to 14 miles and the project’s capacity from 50 to 100 wells.

VVC is advancing its Gloria copper property in Mexico towards production. The 4,055-acre Gloria property is situated in the northern part of Mexico’s Chihuahua state in the Sierra Madre region 60 kilometers southwest of El Paso, Texas. The project is also supported by infrastructure including an access road and an available mining workforce.

VVC Exploration is led by a management team with a wealth of mining experience and is supported by a board of directors with significant influence in both the mining and financial industries. The management and board are also notably invested in the company, with the CEO, members of management and the board of directors listed as top investors. As a whole, the company has a tight share structure with over 90 million shares held by the top 25 investors.

Company Highlights

Helium, Natural Gas & Other Industrial Gases

• A growing portfolio of helium and NG projects with the acquisition of Plateau Helium, currently comprising 69 leases covering 16,400 acres known as the Syracuse Kansas project, 1,600 acres in the Monarch property, Stockholm project (3,000 acres), Johnson-Moore project (6,000 acres), LF project (5,000 acres) and State Line project (6,000 acres).
• The Colorado project, located in Eastern, Colorado, comprises 23,000 acres of gas leases and leasing continuing, with a total of 26 historical wells that were previously drilled flowing gas that tested helium above 3 percent.
• Six wells connected and producing, two ready to complete in the Syracuse KS project (as of December 2024).
• One well drilled and completed, producing into tanks in the Stockholm KS project. Connection line to processing plant in process. Helium, natural gas and oil sales expected in January 2025, additional well sites identified (as of December 2024).
• The initial well of the Kansas Oil project has begun producing. The company is currently in the planning phase for additional wells in the area.
• Installed 14 miles of internal gathering system pipeline to transport helium and natural gas wells to a nearby processing facility.
• Installed a 15-mile water disposal system.

Copper, Base & Precious Metals

• VVC’s near-production Gloria copper property, located in Mexico, has an indicated copper resource of 59.4 million pounds and 89.33 million pounds of inferred copper.

Strategic Investments

Energy Transition & Carbon Capture

• Strategic investment in Proton Green as part of its carbon capture venture. Proton Green’s focus project, the St. John’s Field, contains 33 billion cubic feet of helium and the ability to inject up to 22 million metric tons of CO2 per year at its primary basin
• Helium production began August 30, 2023.
• Food grade CO2 production is expected to begin in 2025.

Helium & Natural Gas

• Strategic investment in the PHC South Africa project, located in the Free State, Republic of South Africa East of Welcome and South of Kroonstad 147 miles southwest of Johannesburg (152,000 acres).

Key Projects

Helium Portfolio

As of Dec 2024

Plateau Helium Corporation

In January 2021, VVC Exploration acquired Plateau Helium Corporation (PHC), a Wyoming Corporation focused on helium exploration and development, primarily in the western US. PHC’s initial target project is located in Kansas and currently comprises 69 leases covering 16,371 acres known as the Syracuse Helium Project.

Plateau Helium Corporation engaged Foreland Operating to manage the company’s helium production. Foreland Operating is a Texas-based upstream oil and gas operating company with a long-tenured team that has been operating in many of the premiere US basins including the Barnett Shale, the Marcellus Shale and the Permian Basin.

Syracuse

Syracuse is VVC’s helium project with 16,400 acres of contiguous oil and gas leases. The company has identified 16 identified well sites in the area with internal estimates of a future resource of 75 Bcf of gas. Currently, Syracuse has 22 well sites permitted or currently being permitted, each with the potential to produce over 1 billion cubic feet of gas.

In 2022, the company announced it successfully completed and connected its first helium well to the project. The well is known as the Levens #2 and was connected to Tumbleweed Midstream’s Ladder Creek Pipeline allowing the transport of gas to the Ladder Creek Helium Processing Plant in Cheyenne Wells, Colorado. The Levens #2 was successfully drilled to a depth of 2,478 feet and encountered multiple gas zones.

As of Dec 2024

Monarch Lease

VVC purchased the Monarch Lease in April 2021, bolstering VVC’s ability to capitalize on the growing demand for helium, driven by increased global usage. The Monarch Lease is a 1,720-acre property that is located in the Byerly Field in Greely County, Kansas and includes six formerly producing gas wells that are still connected to the Tumbleweed Midstream pipeline. All wells produced both methane and helium. There is additional potential in the deeper zones of this property which VVC will explore.

Stockholm Project

The Stockholm project is VVC’s top drilling priority project in Wallace Kansas in an area with significant natural gas potential. Stockholm spans 3,000 acres of permitted jurisdiction targeted for helium, natural gas and hydrogen. VVC has commenced drilling activities at the Josephine Mack 1-18 well, marking the initiation of the company’s first test well within the Stockholm project.The Josephine Mack 1-18 well is VVC’s strategic entry into this geologically promising region which evaluates the hydrocarbon potential of the Morrow Zone. The Stockholm project shows potential for oil production as well.

Copper and Associated Metals

VVC’s current copper focus project is Gloria in Northern Mexico which is a host to oxide copper mineralization with a copper resource of 59.4 million pounds, indicated (9.6 million tonnes grading 0.28 percent copper) and 89.33 million pounds, inferred (14.4 million tonnes grading 0.28 percent copper). The property spans 4,055 acres in Chihuahua State and drilling over the past two years has defined a significant copper mineralized zone over a 15-kilometer strike.

Gloria provides VVC with a unique exposure to the copper market. Approximately 100,000 tons of artisanal ore piles on site that have been high graded, hand cobbed (sorted), and can be utilized for pilot/test mining.

Located in Central Sonora Mexico is VVC’s 16,622-acre Cumeral gold/copper exploration project. Cumeral covers an epithermal style, mineralized gold/silver zone at least 3.6 kilometers long with geological structure and surface sampling suggest the potential for multi-million ounce gold deposit.

Carbon Capture

Proton Green

VVC recently made a strategic investment in Proton Green, an energy transition company poised to become one of the leading helium producers and carbon sequestration hubs in North America.

Proton Green, LLC, is a producer of helium and hydrogen and is building out its position as a large carbon sequestration operator in North America. With operating control over the St. Johns Field, a 152,000-acre property in Apache County, Arizona, Proton Green controls a helium reservoir and carbon storage basin.

Proton Green’s initial project is the St. Johns Field. The St. Johns Field is a massive helium reservoir and immense carbon storage basin located in Apache County, Arizona. Extensive third-party geological studies performed on the property indicate reserves of up to 33 billion cubic feet of helium in shallow, easily accessible reservoirs. Capable of producing one billion cubic feet of helium per year, it will be among the most prolific helium production sites in the world.

It is also projected to be among the largest carbon capture companies in North America, with 22 million metric tons of carbon sequestration per year, and a total storage capacity of over 1 billion metric tons.

Management Team

Terrence Martell – Chairman of the Board

Dr. Terrence Martell is the director of the Weissman Center for International Business at Baruch College and the Saxe Distinguished Professor of Finance where he oversees a myriad of international education programs and projects. He is also the chairperson of the University Faculty Senate and an ex-officio member of the board of trustees at The City University of New York. His area of expertise and research is international commodity markets.

He is a director of the Intercontinental Exchange (ICE) where he serves on the audit committee and has many roles. He serves on the board of the Manhattan Chamber of Commerce and is a member of their executive committee. He is also a member of the New York City District Export Council of the US Department of Commerce and a member of the Reuters/Jefferies CRB Index Oversight Committee. Dr. Martell received his BA in Economics from Iona College and his PhD in Finance from the Pennsylvania State University.

James (Jim) Culver – President, CEO and Director

Dr. James Culver has spent over 40 years in the fields of commodities, international trade and trade finance, holding posts in government, academia and the private sector. For the last 20 years, he has focused on commodity finance and commodity project finance, primarily in mining and metals and agricultural products. He spent 22 years working in New York City where he most recently managed two private commodity asset-based lending companies and developed hedge funds to support their lending activities.

Previously, Dr. Culver served as chief economist and director of the Economics and Education Division for the Commodity Futures Trading Commission. He was responsible for market surveillance and new product approvals. He also served for five years on the staff of the Committee on Agriculture of the US House of Representatives. In addition, Culver has been an active participant in a family-owned and operated business, The Parsons Group International Education Inc., a for-profit educational services company. He earned his B.Sc. at the University of Tennessee Martin and his MSc. and PhD degrees from the University of Tennessee Knoxville.

Andre St-Michel – Senior Consultant, Mexican Operations

A Canadian mining engineer and geologist residing in Chihuahua, Mexico, Andre St-Michel has over 30 years of experience in the mining business with a focus on mine development, mill operation, administration and finance. He has spent the last 10 years working in Mexico where he currently serves as President and CEO of Freyja Resources.

From 2003 to 2008, he was a senior executive of Dia Bras (now Sierra Metals), responsible for its exploration programs and the start-up of its Bolivar copper and zinc mine. From the initial start-up of the mine in 2005, production reached 450 tons per day in 2006 with annual projected revenues of approximately $27 million and cash flows of approximately $10 million. Prior to 2003, he served as president of ECU Silver Mining, developing programs and properties in the US, Brazil and Mexico. He holds a degree from the Laval University Engineering School and a Master’s degree in Project Management from University du Quebec. He is a professional engineer.

Michael Lafrance – Director and Secretary-Treasurer

Michael Lafrance has been VVC Exploration’s secretary and treasurer and geological consultant since December 2012. Since 1980, he has served in similar roles with many other publicly-traded exploration companies. He is also the corporate secretary of POET Technologies Inc. (formerly Opel Technologies), a pioneer in the field of integrated circuits. He is a graduate of the University of Ottawa.

Kevin Barnes – CFO

Kevin Barnes has served as the corporate controller and CFO of various public and private companies over the last 12 years. He also served in the role of IT manager and senior accountant with Duguay and Ringler Corporate Services, a firm which provides corporate accounting and secretarial services to publicly-traded companies. He served as the controller of Canada’s Choice Spring Water, one of Canada’s first publicly traded bottled water companies.

He currently serves as CFO of Poet Technologies, a pioneer in the field of integrated circuits and Controller of an international training institute with revenues of $100 million. Barnes received a computer operations diploma from the Careers Development Institute and has a Certified Management Accountant designation from the ICMA Australia. In 2006, he became a member of the Institute of Chartered Secretaries and Administrators of Canada.

Peter Dimmell – Director

Peter Dimmell is a geologist and prospector who has been involved in mineral exploration in Canada, the United States and overseas for 38 years. He is experienced in all aspects of the mining industry and has guided on-site operations from exploration through to production. He is a past president of the Prospectors and Developers Association of Canada (PDAC), a director and former chairman of the Newfoundland and Labrador Chamber of Mineral Resources and a councilor and member of the Geological Association of Canada. He sits on the Board of Directors of four other public companies: Arehada Mining, Linear Gold, Pele Mountain Resources and Silver Spruce Resources, for which he also serves as CEO.

Bruno Dumais – Director

Bruno Dumais is vice-president of finance, for BroadSign International, a Montreal-based provider of digital signage solutions. He possesses over 20 years of experience in financial, forecast and strategic planning and is responsible for overseeing global financial activities. Before joining BroadSign, he was the chief financial officer, vice-president of finance and a consultant at Mitec Telecom for seven years. He has also held senior level positions in companies crossing a variety of sectors, such as Gestion Exponent, Nortel Networks and Premier Tech. Dumais is a chartered professional accountant and holds both a Bachelor in Business Administration from the University of Quebec in Rimouski and an International MBA from the University of Ottawa.

Patrick Fernet – Director

Patrick Fernet is a legal, operations, and corporate governance expert with more than twelve years’ experience in Canadian small-cap public corporations. He serves as a consultant to VVC on a variety of corporate matters. He has more than 15 years of governance experience with small-cap Canadian corporations.

Scott Hill – Director

Scott Hill has served as chief financial officer of Intercontinental Exchange Inc (ICE) since May 2007. He is responsible for all aspects of ICE’s finance and accounting functions, treasury, tax, audit and controls, business development, human resources and investor relations. Hill also oversees ICE’s global clearing operations. Prior to joining ICE, Hill was assistant controller for Financial Forecasts and Measurements at IBM, where he oversaw worldwide financial performance and worked with all global business units and geographies. Hill began his career at IBM and held various accounting and financial positions in the US, Europe, and Japan, including vice-president and controller of IBM Japan, and assistant controller, financial strategy and budgets..

Leon Vijay Shivamber – Director

Leon Shivamber is a transformation leader with more than three decades of successful transformations under his belt. He learned about strategy and business integrity during his years at McKinsey & Company, change management, and rapid transformation during his New York Consulting Partners years and high-performance acquisitions during his years at Arrow Electronics. He spent five years leading the prize-winning supply chain and operations transformation at the then Harris Corporation (now L3 Harris Technologies). For three years after that role, Leon extended and applied his transformation experience as a leader and general manager building an international joint venture in the Middle East.

Thereafter, Leon spent three years as CEO leading the vibrant UAE headquartered Atlas Group with strategic businesses in communications, defense, energy, food, healthcare, hospitality, public safety, and security. He also spent two additional years advising Atlas Group and other Middle-East-based corporations on their transformation efforts. Since that time, Leon has returned to the United States and has been acting as a senior advisor to several corporate transformations. He is a fellow, Life Management Institute (FLMI), and a trustee of the board of directors of Baruch College Fund.

5. Peter Grandich, Peter Grandich & Company

Kicking off the list in the fifth spot is Peter Grandich of Peter Grandich & Company.

Speaking in early August, when gold was approaching the US$2,500 per ounce level, Grandich explained why he no longer sees US$5,000 as a ‘foolish’ price target.

4. Willem Middelkoop, Commodity Discovery Fund

Willem Middelkoop of Commodity Discovery Fund is next.

In this January interview, he shares his 2024 outlook on a wide variety of sectors, but also looks much longer term.

3. David Morgan, the Morgan Report

Morgan was positive on the metal’s prospects, but stayed conservative with his 2024 call.

2. Gareth Soloway, VerifiedInvesting.com

Gareth Soloway of VerifiedInvesting.com comes in at number two, and at the end of August he laid out a gold price target of US$2,660, saying it could get there later in 2024 or early in 2025.

Gold did ultimately reach that level in 2024, but Soloway also gave a much longer-term look forward. He shared how the metal could pass US$6,000, although he emphasized the difficulty of forecasting that far out.

1. Rick Rule, Rule Investment Media

At the beginning of the year, he mentioned several sectors he was looking at, including platinum, palladium and nickel, as well as oil and gas. However, of particular interest to him at the time was silver.

1. Biden Signs Bill Banning Russian Uranium Imports, Restrictions to Begin in 90 Days

Among the biggest uranium news during the first half of 2024 is the United States’ Prohibiting Russian Uranium Imports Act, which was signed into law by US President Joe Biden on May 13 after it received unanimous approval in the Senate on April 30.

The act, which took effect on August 11, ended the country’s three-decade dependence on Russian uranium.

The US said that it is focused on American uranium production and enrichment. Centrus Energy (NYSEAMERICAN:LEU), the country’s biggest trader of enriched uranium from Russia, is also producing high-assay low-enriched uranium (HALEU) at the American Centrifuge Plant in Piketon, Ohio.

The Piketon demonstration project has reportedly enriched more than 100 kilograms of HALEU and is expected to ramp up production to 900 kilograms in the coming years.

Under the new law, the Department of Energy (DOE) is allowed to issue waivers authorizing Russian uranium imports according to limits established in an anti-dumping agreement. This usually is for cases where buyers are not able to find an alternative option.

The statute is set to expire at the end of 2040.

2. China Approves 11 Nuclear Reactors in US$31 Billion Green Energy Investment

China made headlines when it announced its approval of 11 nuclear reactors across five major areas: Jiangsu, Shandong, Guangdong, Zhejiang and Guangxi.

State-owned entities China National Nuclear (CNNC) and China General Nuclear Power Group (CGN) were assigned to oversee the construction of the majority of these projects.

According to China, the construction of these reactors forms part of its broader strategy to significantly increase its nuclear power capacity by 2035.

The country’s nuclear power capacity can cover about 5 percent of its electricity demand right now, and it plans to double this to 10 percent by 2035, coinciding with a massive expansion in wind and solar projects.

December 2024 statistics from the World Nuclear Association show that 65 reactors are under construction across the world, 29 of which are in China, with 90 more being planned globally.

3. Russia Restricts US Uranium Exports, Retaliating to American Ban

As a response to the US’ ban on Russian uranium imports, Russia announced its temporary restrictions on enriched uranium exports to the US on November 15.

The ban, which will be in place until December 31, 2025, applies to all products under the definition ‘uranium enriched with the isotope uranium-235” and does not include the exports under one-time licenses issued by the Russian Federal Service for Technical and Export Control.

Like the US’ allowance of waivers, the Russian decree also accounts for special cases where companies with permits from the export control watchdog are allowed to export uranium to the United States.

The move came two months after President Vladimir Putin said in a September 11 government meeting that Moscow should consider limiting exports of key metals such as uranium, titanium and nickel in retaliation for Western sanctions.

4. US to Spend US$2.7 Billion on Low-enriched Uranium from Domestic Sources

Nearly a month before the US ban on Russian uranium import took effect, the country said that its Department of Energy (DOE) would purchase up to US$2.7 billion worth of low-enriched uranium from domestic sources.

The proposal, issued on June 27, said that the purchase would “enhance national energy security and create new jobs in the nuclear industry.”

In December, the DOE penned supply contracts with six companies: Centrus Energy subsidiary American Centrifuge Operating, General Matter, Global Laser Enrichment, Louisiana Energy Services, Urenco USA’s Laser Isotope Separation Technologies and Orano Federal Services.

“(These companies) will be able to compete for future work to supply LEU, fostering strong commercial sector investment,” the DOE press release read.

According to the DOE, all contracts are valid for 10 years and each company receives a minimum contract of US$2 million.

This move, along with other initiatives, are discussed in the DOE’s Pathway to Advanced Nuclear Commercial Liftoff report, which supports the advancement of technologies that can help the US achieve net-zero emissions by 2050.

5. Paladin Energy to Acquire Fission Uranium in C$1.14 Billion Deal

The biggest uranium acquisition news of 2024 is the C$1.14 billion deal between Paladin Energy (ASX:PDN,OTCQX:PALAF) and Fission Uranium (TSX:FCU,OTCQX:FCUUF), which was announced on June 24.

The terms of the agreement state that “Paladin will acquire 100 percent of the issued and outstanding shares of Fission, while Fission shareholders will receive 0.1076 fully paid shares of Paladin for each Fission share they hold.”

Once completed, Paladin shareholders will hold 76 percent of the company, while Fission shareholders will collectively hold the remaining 24 percent.

Paladin received the final approval from Canadian authorities to perform the acquisition on December 18, and the deal officially closed on December 23.

“The combination of Paladin and Fission creates a world-class diverse uranium producer operating in multiple countries, with a high-quality portfolio of production, development and exploration assets,” Paladin CEO Ian Purdy said in a December 19 press release.

1. Chinese Copper Smelters to Trim Output in Response to Falling Margins

On July 16, Chinese smelters Daye Nonferrous Metals (HKEX:0661) and Baotou Huading Copper Industry Development made headlines following their decision to cut production outputs in 2025.

The former, a major company, reported a planned 20 percent cut, while the latter, a smaller firm, announced a 40 percent reduction.

Both smelters attributed the decrease to “diminishing profit margins caused by an ongoing shortage of ore concentrate,” as reported by Bloomberg.

Other factors affecting the decision include the decrease in smelter utilization rates caused by low treatment and refining charges towards the end of 2024 and significant production losses.

Daye Nonferrous Metals’ half-year earnings reveal revenue was up by 55 percent compared to the first half of 2023, largely attributed to a resumption of smelting at its plant.

2. BHP: Global Copper Demand to Surge 70 Percent by 2050

Mining giant BHP (ASX:BHP,NYSE:BHP,LSE:BHP) forecast that copper demand will reach over 50 million metric tons by 2050.

In a September 30 report, BHP said, “Unlike the 20th century, where the adoption of cars, electricity, consumer electronics and white goods occurred at different times across various regions, we expect to see more-or-less concurrent adoption of the copper-intensive technologies of EVs, renewables and data centres around the world.”

The company anchored its predictions on several factors, namely traditional economic growth, the ongoing global energy transition and the expansion of digital infrastructure.

Global efforts are currently intensified to curb greenhouse gas emissions, resulting in a projected rise in copper demand.

Current copper mines are expected to supply more than half of the copper needed to meet global demand over the next decade. However, by 2035, production from these mines could decline by 15 percent due to decreasing ore grades, highlighting the urgent need for significant investment in upgrades and new projects to sustain supply.

Despite these challenges, the pace of new copper discoveries has dramatically slowed, with only four major finds in the last five years. This scarcity of greenfield projects poses a substantial challenge to meeting future demand.

In summary, major market players like BHP will need to adopt innovative strategies and make substantial investments to bridge the gap, ensuring a stable supply of copper as industries increasingly rely on the metal for clean energy solutions.

3. IEF: World Needs 35 to 194 New Copper Mines by 2050 to Support Massive Demand

The International Energy Forum (IEF) also published a significant copper report in 2024, which highlighted the need for more copper mines by 2050 and government support and incentives for these projects.

The report singled out limited exploration as one of the copper market’s biggest challenges at the moment. It also discussed the long periods between discovery and production.

“New copper mines that started operation between 2019 and 2022 took an average of 23 years from the time of a resource discovery for mines to be permitted, built, and put into operation,” it said.

The IEF detailed multiple copper demand scenarios through 2050. For business as usual there would need to be 35 new copper mines by 2050; EV plus grid would require 54 new copper mines; and net-zero by 250 would require a massive 194 new copper mines.

IEF Secretary General Joseph Mongle emphasized that without changes in current policies, 100 percent realization of EV adoption would not be possible.

“To make the best use of available copper supply, governments should prioritize economy-wide electrification, which is the foundation of climate policy. Moreover, governments need to incentivize and support new copper mine projects,” he said.

4. LME Sanctions on Russian Metal Push Copper, Nickel and Aluminum Prices Higher

On April 12, the British government and the US Department of the Treasury announced bans of Russian aluminum, nickel and copper on the London Metal Exchange (LME) and Chicago Mercantile Exchange (CME).

The LME is the oldest and largest metals trading forum in the world, responsible for setting benchmark prices for metals such as aluminum and zinc.

The news led to increases in the prices for all three metals, with aluminum jumping 9.4 percent — its largest one day increase since 1987 — nickel soaring by 8.8 percent and copper getting a smaller 1.6 percent bump.

The restrictions cover any metal produced in Russia starting April 13. Owners of Russian metal produced before the said date were allowed to place their metal on LME warrant, provided they furnish evidence of production dates.

The ban is part of continuing sanctions imposed by the US and UK on Russia due to its invasion of Ukraine. Trading of Russian metals outside of the LME and CME’s systems is not included in the ban.

There have been no updates on the restrictions as of this writing.

5. Goldman Sachs Cuts Copper Price Forecast on Weak Chinese Demand

While the reports above discussed the increasing demand for copper, China’s demand for the red metal was reportedly weakening due to a slow economic recovery.

Supporting this claim was American investment bank Goldman Sachs (NYSE:GS), which in September significantly lowered its 2025 copper price forecast due to that factor. The firm reduced its prediction to US$10,100, a large dip from the previous US$15,000 forecast.

According to Bloomberg, the US$15,000 prediction came from former analysts Jeffrey Currie and Nicholas Snowdon, while the new outlook was outlined in a note by analysts including Samantha Dart and Daan Struyven.

‘Softer-than-expected China commodity demand, as well as downside risks to China’s forward economic outlook, lead us to a more selective, less constructive tactical view of commodities,’ the analysts said.

Copper reportedly had an average monthly price of over US$9,000 per metric ton in November, down from its over US$11,000 per metric ton price record in May.

Chart via US Global Investors.

Investopedia’s more recent analysis continues to support the ‘January no-effect’ position. Looking back three decades since the 1993 inception of the SPDR S&P 500 ETF Trust (ARCA:SPY), investment advisor and global market strategist James Chen points out that in the last 31 years ‘there have been 18 winning January months (58%) and 13 losing January months (42%), making the odds of a gain only slightly higher than the flip of a coin.’

The past two years, the markets have performed strongly in January. January 2023 saw the S&P 500 jump 5.8 percent over the course of the month after falling at the end of December. However, markets fell back down through February and March, making the rally short lived.

In January 2024, the S&P 500 dipped slightly at the start of the month but ultimately closed January up 2.12 percent higher than its open. Unlike the previous year, the index continued that upward trend through the end of March, at which point it was up 10.73 percent from the beginning of the year.

Hertz Energy Inc. (“Hertz” or the “Company”) (CSE: HZ; OTCQB: HZLIF; FSE: QE2) is pleased to provide an update on the Company’s critical minerals projects, including antimony, lithium, and uranium and announces proposed financing.

ANTIMONY

The Company is focused on exploring its two antimony projects aggressively with use of Quebec Critical Minerals Flow thru funds at the Harriman Antimony Project in Quebec and Canadian Flow thru funds at its Lake George Antimony Project in New Brunswick.

LAKE GEORGE ANTIMONY PROJECT: NEW BRUNSWICK, CANADA

The Property is located in the southwestern part of the Province, approximately 30 km southwest of the city of Fredericton.

The Property is comprised of 93 mineral claims within two claim blocks recently staked by the Company for a total area of approximately 2,104.5 hectares. The Property surrounds the past-producing Lake George Antimony Mine (‘Lake George Mine‘) and is considered an exploration-stage Antimony-Gold (Sb-Au) prospect located immediately along strike to the southwest and northeast, as well as downdip to the north of the historical Lake George Mine. The Property benefits from excellent road access, hydroelectric power, and nearby available personnel for field and exploration activities.

The Lake George Mine was formerly the largest antimony producer in North America with a long history of production spanning from 1876 to 1996. The mine closed in 1996 due to falling antimony prices. From 1972 to 1981, 34,417 tonnes of concentrate grading 65% to 66% Sb was produced from the first deposit. Then from 1985 to 1990, approximately 1 Mt grading 4% Sb was extracted from a second deposit (Caron, 1996). The mine also contained molybdenum (Mo), tungsten (W), and Au mineralization. Infrastructure on the Lake George Mine includes 3 shafts, underground development on 10 levels, some remaining surface buildings, and a tailings pond. The deepest level of the mine is approximately 400 m below the surface. The Lake George Sb-Au Mine currently represents one of the Top 3 antimony occurrences in the Province of New Brunswick. More info can be found at: https://hertz-energy.com/lake-george-project/

HARRIMAN ANTIMONY PROJECT:QUEBEC, CANADA

The Harriman Property is an exploration stage antimony project located approximately 17 km northeast of the town of New Richmond in the Gaspé Region of Québec (Figures 1, 2). The Gaspé Region is known for a variety of significant mineral deposits, most notably the Mine Gaspé Copper Mine, currently being developed by Osisko Metals. The Harriman Property benefits from good road access, hydroelectric power, port access, and nearby available manpower.

The Harriman Property is strategically located at the intersection of the major ENE trending Restigouche Fault and Grand Pabos Fault with a second order northeast-trending fault hosting numerous antimony and gold showings (Figure 3).

The Property was developed by compiling and reviewing historical antimony (Sb) and gold (Au) showings from the Québec government geoscientific database known as SIGÉOM. The Property area was defined by a series of four antimony showings, all hosted along a northeast-trending fault structure (Figure 4). Historical results from the nearby showings along the northeast-trending fault include 2.32% Sb, 3.36 g/t Au (Harriman-2), 43.75 Sb, 3.4 g/t Au (New Richmond), 4.8% Sb, 7.89 g/t Au and 15.35% Sb (Harriman-4 Sud) (source: SIGÉOM).

The Harriman Property of Hertz includes the Harriman-4 Sud showing returning 15.35% Sb and 0.07 g/t Au from a historical grab sample of a massive stibnite vein in altered sediments. The nearby Harriman Gold occurrence, located 300 m to the northwest, returned an assay of 22.4 g/t Au from a grab sample. These showings and much of the property have had limited previous exploration and has not had any historical drilling.

Hertz Energy has completed a program of geological mapping and prospecting. The crew’s focus was in the area of favourable geology, particularly surrounding the historical showings as well as stream sediment and prospecting for new antimony and gold showings. Results are expected in the coming weeks. More info can be found at: https://hertz-energy.com/harriman-antimony-project/

LITHIUM PROJECTS

AGASTYA LITHIUM PROJECT:QUEBEC, CANADA

The Agastya Lithium Property is comprised of 209 mineral claims covering approximately 10,650 hectares located in the Province of Québec and consists of three non-contiguous claim blocks along the greenstone belt that hosts the Adina, Trieste, and Galinée properties. These adjacent properties are known for their significant LCT (Lithium-Cesium-Tantalum) pegmatite potential hosted within greenstone/ metasediment packages:

• Loyal Lithium – Trieste Lithium Project: Discovery of six spodumene-bearing pegmatites including a significant drilling result of 31.8 m at 2.2% LiO.
• 50% Azimut Exploration / 50% SOQUEM JV – Galinée Lithium Property:Drilling results include 1.62% LiO over 158.0 m including 3.33% LiO over 29.6 m, and Galinée features a 20 km long lithium-cesium anomaly.
• Rio Tinto/Midland Galinée Project: Spodumene-bearing pegmatite dykes discovered over several hundred metres along a 7 km favourable contact zone. Significant drilling results include 1.38% LiO over 37.86 m including 1.88% LiO over 21.35 m.

The Agastya Property covers the western extent of the greenstone belt that trends through Trieste, Adina, and Galinée. Greenstone belts are known to host LCT pegmatite mineralization and are commonly targeted by exploration companies as they are favourable hosts for lithium and other valuable metals including gold. Recent discoveries surrounding the Agastya Project have been announced by Azimut Exploration and Soquem at their Galine Project: I am running a few minutes late; my previous meeting is running over.

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AC/DC LITHIUM PROJECT: QUEBEC, CANADA

The AC/DC property encompasses amphibolized mafic volcanics (greenstone) of the Rouget and Corvette Formations and plutons of the Vieux Comptoir Intrusive suite, similar to the geological setting that hosts both the Cancet and Corvette lithium projects. Both Cancet and Corvette are hosted by amphibolite rocks of Guyer Group, which is similar in age to the Rouget formation (Mesoarchean).

The northwest-trending mafic volcanics of Rouget and Corvette Formations and associated Vieux Comptoir suites continue northwest to the adjacent Rio Tino/Exploration Azimut Inc. and Rio Tinto/Exploration Midland Inc. project areas.

These are advanced rocks, typically characterized by a pegmatitic texture, a granitic composition and contain several minerals such as biotite, muscovite, tourmaline, garnet, beryl and spodumene. These rocks are also known to host K-feldspar granite phases in pegmatite form which may host an abundance of spodumene.

Based on the results of the remote sensing data analysis and processing twelve (12) anomalous target areas have been identified across the two properties.

• 5 primary and numerous smaller secondary targets are identified at the AC/DC property.
• 7 primary and numerous smaller secondary targets are identified at the La Fleur property.

Strike lengths of the individual target trends range in length from 1 to 15km in length and are between 100m to 1,000m in width and are generally oriented in a northeasterly trending direction.

Each of the anomalous trends contain numerous dyke-like structures identified from high resolution orthophotography. Individual dyke-like structures range in length between 20 –500m or greater, often occur in clusters and are generally noted to occur in conformant orientation to the target trends.

Hertz is aggressively advancing exploration at the AC/DC Project and will provide updates upon receipt of exploration results.

MAP OF AC/DC LITHIUM PROJECT AND RIO TINTO ADJOING KAANAAYAA PROJECT

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SNAKE LITHIUM PROJECT:

Hertz Energy reports that the Company will not be proceeding further with the Snake Lithium Project and has terminated its Option Agreement on the Snake Lithium Property.

NAMIBIA URANIUM PROJECT

Hertz Energy has submitted applications for two uranium Exclusive Prospecting Licenses (EPLs) in Namibia.

Namibia is a country of diverse geology and has one of the richest uranium mineral reserves in the world. There are currently two large operating mines, the Husab and Rossing mines, in the Erongo Region and five major exploration projects planned to advance to production in the next few years as the country embraces the green energy transition. Uranium mining in Namibia is of considerable importance to the national economy1. In 2023, Namibia produced the 3rd largest quantity of uranium worldwide at 6,382 tonnes, ranked only behind Kazakhstan and Australia2.

Hertz Energy Namibia Uranium Project

The application areas cover an area of 9,627.84 hectares located in Central Namibia in the Erongo Region which hosts numerous primary and secondary uranium deposits. Primary economic uranium is hosted mainly in sheeted D-type alaskites which occur both as cross-cutting dykes and as bedding and/or foliation-parallel sills. The sheets can amalgamate to form larger granite plutons or granite stockworks made up of closely spaced dykes and sills. The mineralized alaskites tend to occur at marked stratigraphic levels, often associated with the Khan-Rössing Formation boundary, or, where the Rössing Formation is missing, the Khan-Chuos/Arandis Formation boundary. Secondary uranium deposits occur in calcretes in the coastal plain of the Namib Desert. The deposits are associated with ancient river systems that flowed westward from the Great Escarpment during the upper Cretaceous and lower Cenozoic periods. Uranium mineralization is typically located in calcretised fluvial channels which tend to be buried with little or no obvious surface expression to identify them.

Licence Application EPL-10186

EPL-10186 is located 40 km northeast of the coastal town of Swakopmund. Most of the licence is covered by recent sand, gravel, scree and calcrete, with a few outcrops of mica schist, calc-silicate rock, marble and red granite. There are two prominent sub-surface water conduits/streams which in general, are believed to be geographically similar to where paleo-channels carrying uranium-rich waters would have flowed. Preliminary interpretation of regional airborne radiometric data from the Namibian Ministry of Mines and Energy indicates a strong and consistent radiometric anomaly trending northeast-southwest and coincident with the subsurface streams. The Company is targeting secondary uranium mineralization with potential for primary mineralization to the east of the application area. This is the similar style of mineralization found at ORANO’s Trekkopje Mine 6 kilometres north of EPL-10186 and Elevate Uranium’s Marenica deposit 40km to the north with a resource of 46Mlb U308 at a 93ppm U3O8 cutoff grade.

Licence Application EPL-10185

EPL-10185 is located 22 km east of the coastal town of Swakopmund. Its geology is comprised of units from the Kuiseb, Karibib, Arandis, Chuos and Khan Formations intruded by granodiorites and uranium prospective granites. Most of the western and central parts of the licence is under recent surficial cover made up of sand, gravel, scree, and calcrete. Preliminary interpretation of regional airborne radiometric data from the Namibian Ministry of Mines and Energy indicates radiometric anomalies coinciding with favourable geology for primary alaskite-hosted uranium mineralization. This is the similar style of mineralization found at Bannerman Energy’s Etango deposit located 15 km southeast of EPL-10185 as well as that at the Rossing Mine located 30km to the northeast. The Rossing Mine is one of the largest and longest operating uranium open cast mines in the world producing now for 46 years. In 2022, Rossing produced 2,659t U3O8 and currently has a feasibility study underway to extend the mine life beyond 20265.

Namibia has recently completed its political elections and On 3 December 2024, Netumbo Nandi-Ndaitwah of the ruling SWAPO party was declared the winner of the election. She is set to become Namibia’s first female president. The National Assembly elections saw SWAPO reduced to 51 seats, a bare majority of three. It was SWAPO’s weakest showing since Namibia’s independence in 1990. Incumbent president Nangolo Mbumba had not contested this election. Hertz Energy congratulates President Netumbi Nandi-Ndaithwah.

Hertz Energy EPL-10185 and EPL-10186 have been assessed by the Ministry of Mines and Energy are expected to be issued in Q1 of 2025.

Cautionary Statement: This news release contains scientific and technical information with respect to adjacent properties to the Company’s properties, which the Company has no interest in or rights to explore. Readers are cautioned that information regarding the geology, mineralization, and mineral resources on adjacent properties is not necessarily indicative of the mineralization potential on the Company’s properties.

Qualified Person Statement

All scientific and technical information contained in this news release was reviewed and approved by Paul Teniere, P.Geo., Technical Advisor of Hertz Energy, who is a ‘Qualified Person’ as defined in NI 43-101.

HERTZ ENERGY FINANCING

Hertz Energy is pleased to announce a non-brokered private placement offering of up to 5,000,000 units (the “Units”) at a price of C$0.25 per Unit for gross proceeds of up to $1,250,000 (the “Offering”). Each Unit will consist of one common share in the capital of the Company (a “Common Share”) and one Common Share purchase warrant (a “Warrant”). Each Warrant will entitle the holder thereof to acquire one Common Share at an exercise price of C$0.45 per Common Share for a period of two years from the closing date of the Offering. The Warrants will be subject to an accelerated expiry, whereas anytime after four (4) months following the issue date of the Units that the closing price of the common shares of the Company on the Canadian Securities Exchange (the “CSE”) is equal to or above a price of C$0.55 for fourteen (14) consecutive trading days, the Company may file a notice to accelerate the expiry date of the Warrants to the date that is thirty (30) business days following the date of such notice. This placement is expected to close end of January 2025.

Hertz Energy also announces non-brokered private placement of up to 4,000,000 Quebec and Canadian National flow-through units of the Company (the “FT Units”) at a price of C$0.30 per FT Unit for gross proceeds of up to C$1.200,000 (the “Offering”). Red Cloud Securities Inc. (“Red Cloud”) will be acting as a finder for LaFleur Minerals on a “best efforts” basis under the Offering.

Each FT Unit will consist of one common share of the Company to be issued as a “flow-through share” (each, a “FT Share”) within the meaning of the Income Tax Act (Canada) (the “Income Tax Act”) and the Taxation Act (Québec) (the “Québec Tax Act”) and one common share purchase warrant (each, a “Warrant”). Each Warrant will entitle the holder thereof to purchase one common share of the Company (each, a “Warrant Share”) at a price of C$0.45 at any time on or before that date which is 24 months after the issue date of the FT Unit. The Warrants will be subject to an accelerated expiry, whereas anytime after four (4) months following the issue date of the FT Unit that the closing price of the common shares of the Company on the Canadian Securities Exchange (the “CSE”) is equal to or above a price of C$0.55 for fourteen (14) consecutive trading days, the Company may file a notice to accelerate the expiry date of the Warrants to the date that is thirty (30) business days following the date of such notice.

About the Company

Hertz Energy (CSE:HZ; OTCQB:HZLIF; FSE:QE2) is a British Columbia-based junior exploration company primarily engaged in the acquisition and exploration of energy and critical minerals properties. The Company’s lithium exploration projects include the AC/DC Lithium Project, and newly acquired Agastya Lithium Property in James Bay, Quebec. Hertz Energy also holds the Harriman Antimony Project in Québec and the Lake George Antimony Project in New Brunswick, Canada. Hertz Energy also has permit applications pending in Namibia for uranium exploration projects.

For further information, please contact Mr. Kal Malhi or view the Company’s filings at www.sedarplus.ca.

On Behalf of the Board of Directors

Kal Malhi Chief Executive Officer and Director Phone: 604-805-4602 Email: kal@bullruncapital.ca

Neither the Canadian Securities Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this news release.

Cautionary Statement Regarding “Forward-Looking” Information

This news release includes certain statements that may be deemed “forward-looking statements”. All statements in this new release, other than statements of historical facts, that address events or developments that the Company expects to occur, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects”, “plans”, “anticipates”, “believes”, “intends”, “estimates”, “projects”, “potential” and similar expressions, or that events or conditions “will”, “would”, “may”, “could” or “should” occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include market prices, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward-looking statements are based on the beliefs, estimates and opinions of the Company’s management on the date the statements are made. Except as required by applicable securities laws, the Company undertakes no obligation to update these forward-looking statements in the event that management’s beliefs, estimates or opinions, or other factors, should change.

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