Can you introduce Drone Delivery Canada (TSXV: FLT) and provide an overview of the company’s business model?

Originally the focus of Drone Delivery Canada (DDC) was on delivering supplies to remote communities. This helped get the Canadian government on board and enabled us to establish a close working relationship with Transport Canada as the regulator. At that time, use cases were twofold – accessing areas that were difficult to get to and getting to places in a time critical manner. This is still the case.

As DDC evolved, we recognized that there were also natural business verticals, such as mining, that were well suited for drone technology and we are currently working to expand our business in this area. There is a strong case for drones in any situation where access is difficult for a variety of reasons, be it distance, quality of roads, seasonal roads, and these are challenges many mining sites face in Canada and globally. For instance, if a company has a large open pit mine with a C$10 million earthmover machine that is down in a remote part of the mine, as it waits for a C$2 part, every minute that it is holding up a billion dollar mining project is costly. If DDC can transport that replacement part to the earthmover with a drone in five minutes versus somebody in a truck that will take an hour or two, there is real value in choosing the drone. Time is money or time is lives depending on the situation.

Additionally, with the pandemic new use cases have come up. One is limiting person to person contact. Within a mine that could mean getting core or water samples out to a test lab, where you want to eliminate the involvement of people who can bring the virus into the mining camp. The second use case that has come about as a result of the pandemic is related to business continuity and disaster recovery. Many companies realize they do not have a backup supply chain and drones are an ideal backup in the event of a pandemic, natural disaster or adverse weather event.

Can you provide us with an idea of the payload DDC’s drones carry and distance they cover?

DDC currently has three drones in its fleet. Sparrow is the smallest drone in use and it has been compliant for commercial operations with the Canadian government since 2017. It is unmanned, electric, with a 30 km range, and can handle a payload of 4.5 kg. Moving up in size, DDC offers two additional models called Robin and Condor. We are wrapping up testing on those and they will be commercially available in 2021. Robin is also electric and has a range of 60 km and a payload of 11.3 kg. Lastly, Condor is our largest drone available and it is unique in the industry, because of its ability to carry heavy loads over long distances. It has a 200 km range and 180 kg of payload. The Condor is also unmanned and uses a traditional automotive gasoline two stroke engine. It is a very reliable and tough machine, so it is different from what you see from an Amazon or Google. Their business is focused on taking five pounds and going a few kilometers. That will not work for mining, which is why Condor is well positioned to handle remote and challenging environments.

How does drone technology align with your belief about where the future of mining is headed?

I see drone technology falling under the umbrella of autonomous vehicles. In large open pit mines, getting from one point to another is not easy and there is cargo going in and out. There is a need to be able to move around more quickly, efficiently and safely within a mine and I think drones are ideal for that.

DDC drones can carry cargo, but we can also carry specialized cameras and sensors capable of detecting gas leaks, estimating inventory and stockpiles and performing inspection in high risk areas. For example, if you have just done some blasting and you want to send a drone into the area for inspection safety purposes, DDC drones can perform that task. Throughout the stages of mining from exploration all the way through to closure and reclamation, drone delivery as well as sensors and cameras can be utilized. Today, companies are looking at autonomous vehicles and going with what they are comfortable, which tends to be trucks. However, as they gain in their level of comfort and understanding of autonomous technology, they will get into the kind of drones that DDC offers. It is a crawl, walk, run approach.