Can you give an update on what has kept SIDEX busy over the past six months?

In terms of financing and deal flow, the markets have remained unusually slow over the past two to three years. The reason for this might just be cyclicality and market malaise as, during this period, commodity prices have been good. There is an increased focus on lithium, but gold and base metal financing has been slower than usual.

Québec’s mining industry is in tune with the energy transition, and SIDEX plays into this as well with having a great focus on battery metals, especially copper and nickel. The majority of our portfolio is gold-related companies, but when a lithium, nickel, or copper player comes in, we give it special attention as we would like to increase the critical mineral component of our portfolio.

Are you expecting more activity in the lithium space in the coming years?

Interest in lithium in Québec continues to increase and we are not only seeing pure-play lithium companies positioning themselves in the province, but many of the companies in SIDEX’s portfolio, which has originally been focused on other commodities, are now also starting to look at lithium opportunities on their properties, and these companies’ stocks have moved up significantly because of that. Québec is extremely well endowed with lithium projects, and there are some serious plays, such as Patriot Battery Metals’ world-class deposit and Nemaska Lithium’s project starting to take shape and making significant headway.

It is encouraging to see increasingly more offtake agreements and the downstream of the value chain getting involved in projects to secure future supply. Offtakes are an extremely important step as it they are crucial to structuring financing, and the companies that are struggling to find offtakes will probably struggle to finance their projects. Australia is the biggest lithium producer in the world, and it is great to see many Australian companies positioning themselves in Québec for lithium exploration, bringing along their high level of expertise. Patriot Battery Metals and Sayona are great examples.

Can you speak of SIDEX’s investment criteria today?

Before ESG was a buzzword, we already had a requirement that when we invest in a company it needs to have a strong sustainability policy in place, and if not, we give them six months to put it in place. We have been focused on sustainability for over a decade and today continue to refine our investment criteria in terms of ESG. SIDEX is also very much interested in innovative approaches to exploration.

What is your outlook for the junior financing environment in Québec moving into 2024?

I believe junior financing will pick up, especially as we are already seeing more M&A activity and deal flow. Maybe we are seeing a slow exploration financing environment due to the amount of M&A and joint venture deals currently being done that they have just not gotten to the phase of actually deploying funds to the exploration itself. Mining has an insatiable appetite for capital, and I believe exploration financing will come back shortly, maybe even stronger than it has ever been. Québec has a globally unique ecosystem to finance mining companies, and many funds and institutions have support and buy-in from the government, dedicated to financing mining activities at every level of the cycle, such as SIDEX, which is focused on grassroots exploration.

How is SIDEX going to continue to help early-stage exploration companies in Québec?

I have every reason to believe that things are going to pick up, especially concerning lithium. We are increasingly seeing more companies coming to Québec looking for lithium, but SIDEX has over a dozen companies in our portfolio that are realizing that they have lithium prospects and which they are now starting to activate. We have recently seen one of the companies in our portfolio, Midland Exploration, and Rio Tinto signed a significant deal worth CAD$64.5 million over the ground in Québec's James Bay lithium region, and with Rio Tinto footing the bill for a significant amount of the drilling, they might be knocking on our door. There is also still a lot of activity in the gold space, and with increased demand for critical minerals, next year will be busy for SIDEX.