Palisade Research - Tue, Jun 20, 2018

Cornerstone Metals - Game Changer Results Add $600M of Recoverable Vanadium

image with periodic table info about vanadium: 23 V 50.942

Cornerstone Metals Inc. (CVE:CCC OTC: CCCCF)

  • Share Price: C$1.17
  • Shares Outstanding: 32.2M
  • Market Capitalization: C$37.2M
  • Cash: C$2.6M
  • Total Liabilities: C$0.3M
  • On May 28, 2018, we initiated coverage on our favorite vanadium play - Cornerstone Metals Inc. They are developing North America's largest and richest vanadium deposit.

    You can read the original report here . . .

    Since our write-up, Cornerstone Metals is up 102%. . .

    In our report - we highlighted the significance of the company's outstanding preliminary metallurgic test results.

    Such recovery rates are often the inflection point for any promising project, and any seasoned resource investor will eagerly await the test results before pulling the trigger in any sort of investment - they must make sure the project is economical.

    Thus far, initial pressure leaching tests have achieved vanadium extraction levels between 80.2% and 83.6% - already extremely strong numbers.

    This morning, Cornerstone announced additional preliminary results of metallurgical tests being conducted on their Carlin Vanadium Project in Nevada. . . And the third round of testing has achieved vanadium extraction levels of 95.5%.

    Putting this into perspective, Cornerstone's closest peer, Prophecy Development Corp., has only a 62% recovery rate through direct heap leaching.

    Prophecy's flagship project - Gibellini - which is also located in Nevada, contains just 207 million pounds of vanadium with average grades of 0.27% - yet the project still touts an after-tax NPV7 of $338.3 million.

    On the other hand, Cornerstone Metals - with the limited exploration on their project so far - has 289 million pounds of vanadium with average grades of 0.52%.

    Another comparison example is CellCube Energy Storage Systems' (previously Stina Resources) Bisoni McKay project, which is also located in Nevada, and has 152 million pounds of vanadium averaging 0.40%. . .

    Bisoni McKay test results indicate potential vanadium recovery rates of 90% - the company currently has a market capitalization of $50.1 million.

    If the inferior Gibellini project has an after-tax NPV7 of $338.3, we expect Cornerstone's Carlin Vanadium project to be worth significantly more.

    For instance - the prior metallurgical test results from Cornerstone showed recoveries in excess of 80% - but today's results show up to 96% recoveries - which is a game changer for the company.

    This adds roughly $600 million of additional vanadium ore to be recovered over the life of the mine. . .

    So, to summarize our investment thesis. . .

    - Attractive future vanadium supply/demand fundamentals

    - In a safe mining location

    - Enormous high-quality asset

    - Extremely cheap relative to intrinsic value

    - Attractive Recovery Rates

    - Quality Managerial Team

    - And significant resource expansion upside

    Cornerstone's fast-tracking to a Prefeasibility Study (PFS), which will be completed in 2019.

    They company has a lot more room to run - investors looking to build a position in this stock still have time. . .

    Palisade Global Investments Limited holds shares of Cornerstone Metals. We receive either monetary or securities compensation for our services. We stand to benefit from any volume this write-up may generate. The information contained in such write-ups is not intended as individual investment advice and is not designed to meet your personal financial situation. Information contained in this report's from sources we believe to be reliable, but its accuracy cannot be guaranteed. The opinions expressed in this report are those of Palisade Global Investments and are subject to change without notice. The information in this report may become outdated and there is no obligation to update any such information. Do your own due diligence. publishes interesting contributor articles in addition to its own content. We have not verified any of the above details.

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