DY6 Metals

Overview

Rare earth elements (REEs) collectively represent some of the most critical minerals in the world. This group of interrelated minerals has an incredibly broad range of applications — everything from military equipment to consumer electronics. They are also pivotal in the global transition to clean energy and decarbonization. Neodymium magnets, for instance — composed of neodymium, iron and boron (NdFeB) — are increasingly being used in wind turbines and electric vehicle motors. Dysprosium is added to NdFeB magnets to increase the magnet’s resistance to demagnetization, thereby improving performance through higher operating temperatures. Terbium is used extensively in solid-state devices and low-energy lightbulbs.

REEs are also essential to the production of devices such as smartphones, lending context to the news that alongside other critical minerals such as lithium and cobalt, global demand for REEs is expected to increase by as much as 600 percent over the next several decades.

It is clear the world needs to ramp up rare earths production — a challenge DY6 Metals (ASX:DY6) understands. This mineral exploration company holds a 100-percent interest in three highly prospective critical metals projects in Malawi. As one of the most stable jurisdictions in Southern Africa, Malawi is home to considerable mineral wealth — a fact which, alongside its mining-friendly government, have seen the country enjoy significant mining investments over recent years.

Maiden drilling is already underway at the company's flagship Machinga Heavy Rare Earth Project alongside plans for further exploration. Long-term, DY6's strategy is to increase shareholder value through high-impact drilling and resource delineation.

And so far, this strategy appears to be working.

Company Highlights

• DY6 Metals is an ASX-listed company with 100-percent ownership of three highly-prospective heavy rare earth and critical metals projects in Southern Malawi.
• The company recently completed a successful $7-million initial public offering.
• DY6 employs an experienced management team which includes geotechnical experts and mining professionals.
• All three of DY6's projects feature near-surface, high-grade historical drillings and/or workings, and all three are significantly underexplored with considerable potential to define new mineralised zones.
• Initial exploration of DY6's projects will focus on significant historical REE drill results.
• Malawi as a mining jurisdiction is incredibly prospective for rare earth elements. In recent years, multiple resource companies have been engaged in comprehensive exploration and development within the region, including:
  • Lindian Resources (ASX:LIN)
  • Globe Metals (ASX:GBE)
  • Mkango Resources (TSX/AIM: MKA)
  • Sovereign Metals (ASX:SVM)
• Malawi is also known for its excellent operating infrastructure, mining-friendly regulations, and push for renewable energy.

Key Projects

Machinga

Located within the Chilwa Alkaline Province (the same province that hosts Lindian’s Kangankunde project), Machinga is DY6's flagship project. The original exploration license, covering 42.9 square kilometers, was acquired in light of uranium channel radiometric anomalies located by a country-wide airborne survey in the 1980s. The anomaly present in Machinga is continuous along a strike of roughly 7 kilometers.

Project Highlights:

• Near-surface Mineralization: Machinga hosts high-grade, near-surface heavy rare earth oxides as well as niobium, tantalum and zirconium potential.
• Promising Anomalies: The nature of the Machinga radiometric anomalies indicates that there is significant potential for DY6 to discover additional REE mineralization across the wider project area.
• Location: The Machinga Project is located along the Lilongwe-Zomba highway and is situated just north of the town of Zomba.
• Area Geology: Geologically, the complex in which the Machinga Project is located is defined by a large alkaline complex that intrudes Proterozoic basement gneisses, granulites and amphibolite. The project area itself is dominated by a large syenite pluton and contains a number of smaller intrusions and pegmatites.
• Drill Results: Results from a 2010 drill program at Machinga North, itself one of six targets in the area, included:
  • MARC005
    • 11 meters at 1 percent total rare earth oxide (TREO) with 330 parts per million (ppm) dysprosium oxide (from 12 meters), including;
    • 4 meters at 1.4 percent TREO with 492 ppm dysprosium oxide (from 19 meters)
  • MARC015
    • 5 meters at 1.5 percent TREO with 596 ppm dysprosium oxide (from 26 meters), including;
    • 1 meter at 2.5 percent TREO with 971 ppm dysprosium oxide (from 27 meters)
  • A heavy rare earth oxide (HREO):TREO ratio with a peak of 39 percent and an average of 33 percent.
  • A dysprosium oxide:TREO ratio with a peak of 3.9 percent and an average of 3.3 percent.
  • The target is especially rich in dysprosium and terbium. It also contains significant thulium, ytterbium and lutetium results.
• Trench Results: Trenching undertaken in 2010 returned 33 meters @ 0.71 percent TREO, Inc.: 11 meters @ 1 percent TREO with 0.46 percent Nb2O5 (MATR002)

Salambidwe

Straddling the Malawi-Mozambique border, the Salambidwe project covers an area of 24.9 square kilometers, associated with the Salambidwe Ring Complex, which is known for hosting multiple notable carbonate deposits. Geology in the area is also associated with high radiometric values, typically associated with REE mineralization.

Project Highlights:

• Considerable Potential: The Salambidwe project is a virgin rare earth carbonate prospect. While no drilling has taken place at the project, rock-chip samples returned 2.05 percent TREO including 214 ppm dysprosium oxide.
• Area Geology: With a diameter of approximately 6 kilometers, the Salambidwe Ring Complex is largely syenite and nepheline syenite with an agglomerate rock core. Based on this geology, the project has the potential to host any of the following: copper, iron, titanium, niobium, thorium, uranium, REE, barium, phosphorus and fluorine.

Ngala Hill

Situated just east of the Thyolo Fault, the Ngala Hill Project's zone of mineralization contains a strong magnetic anomaly indicative of an oxidized intrusive. Like Salambidwe, Ngala Hill is a relatively fresh asset. It has not been the target of any significant modern exploration efforts, though the results from historical works are nevertheless promising.

Project Highlights:

• Multiple Mineralization Zones: Ngala Hill's deposit takes the form of an ultramafic chonolith that intrudes onto an underlying Proterozoic Basement Complex quartz feldspar-amphibole gneisses. The chonolith is also cut by Karoo-age dolerite dykes. Currently, DY6 has identified three zones of palladium-rich palladium-platinum-gold-copper mineralization worthy of follow-up.
• Promising Historic Results: After trenching the deposit in 2000, Phelps Dodge identified the following mineralization:
  • 12 meters at 3 grams per ton (g/t) platinum group elements (PGE)+gold
  • 70 meters at 1.12 g/t PGE+gold, including 8 meters at 3.3 g/t PGE+gold
• Presence of Massive Sulphides: Historical exploration has identified massive sulphides with grades of up to 4 g/t palladium+platinum+gold and 0.7 percent copper in saprolite/saprock.
• Close Proximity to Major Infrastructure: Ngala Hill is located close to the Nacala rail/port corridor, with easy access to grid power.

Management Team

Dan Smith - Non-executive Chairman

Dan Smith holds a Bachelor of Arts, is a fellow of the Governance Institute of Australia and has over 15 years’ primary and secondary capital markets expertise. He is a director and co-founder of Minerva Corporate, a boutique corporate services and advisory firm. He has advised on and been involved in over a dozen IPOs/RTOs on the ASX, AIM and NSX. Smith is currently non-executive director for several companies on AIM/ASX operating in the resources sector with a focus on critical minerals and has been heavily involved in project origination and evaluation.

Lloyd Kaiser - Chief Executive Officer

Lloyd Kaiser brings a wealth of knowledge and experience in the rare earths sector having recently held the role of general manager of sales and marketing at Arafura Rare Earths Limited (ASX:ARU) where he successfully negotiated binding rare earth off-take agreements with key automotive and wind energy equipment manufacturers. During his more than 10 years of tenure at Arafura, Kaiser also spent a number of years as general manager of technology and engineering where he successfully delivered technology and process flowsheet development milestones, enabling completion of feasibility and FEED engineering at Arafura’s flagship asset, Nolans Bore, Northern Territory.

Kaiser is a chemical engineer with over 30 years of experience in the resource sector spanning multiple commodities, and has amassed a large industry network of participants across the rare earths supply chain.

Myles Campion - Non-executive Director

Myles Campion has over 30 years’ experience in the natural resources sector, including exploration geology, resource analysis, fund management, equities research and project and debt financing. He started his career as an exploration and mining geologist in Australia covering base metals and gold. This included being the project geologist at LionOre responsible for the exploration, discovery and BFS completion of the Emily Ann Nickel Sulphide Mine.

Campion’s financial experience ranges from Australian and UK equities research to project and debt financing in London and fund manager for the OEIC Australian Natural Resources Fund for five years in Perth. He has been the executive director of Europa Metals since August 2020 and is a non-executive director at Katoro Gold.

John Kay - Non-executive Director

John Kay is an experienced corporate lawyer and corporate adviser. He has over 15 years’ experience in equity capital markets, M&A and resources gained through both private practice and inhouse roles in Australia and the UK. He currently operates a corporate advisory practice, Arcadia Corporate, which provides corporate advisory and capital raising services to listed and unlisted companies in the small cap mining sector.

Kay has previously held a number of non-executive and company secretarial roles for ASX listed mining and energy companies and has advised on over a dozen IPOs/RTOs on the ASX. He holds a Bachelor of Laws from the University of Western Australia and is admitted to practice as a lawyer in Western Australia and England & Wales.

Nannan He - Non-executive Director

Nannan He has over 10 years of experience in geosciences, chemical material trading, exploration and resources investment. Through her investment vehicle Woodsouth Asset Management, she has been actively examining exploration and resource projects worldwide and has built strong networks, particularly in the Southeast Asian market.

Troth Saindi - Senior Exploration Geologist

Troth Saindi’s more than 15 years of experience in the mineral resource sector spans from exploration geology through to development and production. Saindi commenced with MSA Group Services in 2006, focusing on gold, PGEs and base metal projects in the Barberton Greenstone Belt and the Bushveld Complex. From 2007 to 2013, Saindi worked with Platinum Group Metals (PTM) Pty Ltd in the Western and Northern Limbs of the Bushveld complex as a project geologist. He successfully led the discovery team in the new Waterberg PGE deposit, where a high-grade ore seam was named after him (T-Reef). From 2013 to present, Saindi has worked as group geologist with AIM- listed Bushveld Minerals Ltd managing several mining and exploration projects.

Eric Lilford - Technical Consultant

Dr. Eric Lilford is a mining engineer and minerals and energy economist with over 30 years’ experience in various senior and executive roles in mining, investment banking, consulting and academic roles. He has multi-commodity expertise and has had operations and government experience across most African mining countries.

Lilford is a member of the international Rare Earths Standards Committee, ISO Australia, and is on the experts panel for the IMF.

Allan Younger - Technical Consultant

Allan Younger is a Geologist with over 40 years’ experience in all facets of the resources industry and most commodities. He is a specialist explorer highly experienced in target generation and project generation with advanced expertise in multi-element geochemistry application and Interpretation. Younger has worked for a number of large international and junior mining and exploration companies, within Australia and internationally, both as employee, contractor or consultant.

Currently, Younger serves as exploration manager for White Cliff Minerals (ASX:WCN), a mineral explorer focussing on rare earths and lithium exploration in Western Australia.

Hilton Banda - Malawian Technical Consultant

Hilton Banda runs an experienced Malawian geological, geotechnical, mining and environmental consultancy, Akatswiri Mineral Resources. His company will assist the DY6's executive management team in Malawi. Based in Zomba, southern Malawi, Akatswiri is only 50 kilometers from DY6's flagship Machinga Project.