Vanadiumcorp Resource : Earnings Document


Management’s Discussion and Analysis

For The Nine Months Ended July 31, 2022

The Management’s Discussion and Analysis (“MD&A), prepared as of September 28, 2022, review and summarize the activities of VanadiumCorp Resource Inc. (“VanadiumCorp” or the “Company”) and compare the financial results for the nine months ended July 31, 2022, with those of the nine months ended July 31, 2021. This information is intended to supplement the unaudited condensed interim consolidated financial statements for the nine months ended July 31, 2022 and the related notes thereto, which have been prepared by management in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. All dollar amounts included in this MD&A are stated in Canadian dollars unless otherwise indicated.


This MD&A contains certain forward-looking statements and information relating to Vanadiumcorp and its operations that are based on the beliefs of its management as well as assumptions made by and information currently available to the Company. When used in this document, the words “anticipate,” “believe,” “budget,” “estimate,” “expect,” “intends,” “plans,” “potential,” and similar expressions, as they relate to the Company or its management and operations, are intended to identify forward-looking statements.

These forward-looking statements or information relate to, among other things: the Company’s future financial and operational performance; the sufficiency of the Company’s current working capital, anticipated cash flow or its ability to raise necessary funds; the anticipated amount and timing of work programs; our expectations with respect to future exchange rates; the estimated cost of and availability of funding necessary for sustaining capital; forecast capital and non- operating spending; and the Company’s plans and expectations for its Property, exploration and community relations operations.

These forward-looking statements and information reflect the Company’s current beliefs as well as assumptions made by, and information currently available to the Company and are necessarily based upon a number of assumptions that, while considered reasonable by the Company, are inherently subject to significant operational, business, economic, competitive, political, regulatory, and social uncertainties and contingencies. These assumptions include cost estimates for exploration programs; cost of drilling programs; prices for base and precious metals remaining as estimated; currency exchange rates remaining as estimated; capital estimates; our expectation that work towards the establishment of mineral resource estimates and the assumptions upon which they are based will produce such estimates; prices for energy inputs, labour, materials, supplies and services (including transportation); no labour-related disruptions at our operations; no unplanned delays or interruptions in scheduled work; all necessary permits, licenses and regulatory approvals for our operations being received in a timely manner and can be maintained; and our ability to comply with environmental, health and safety laws, particularly given the potential for modifications and expansion of such laws. The foregoing list of assumptions is not exhaustive.

Forward-looking statements and information involve known and unknown risk, uncertainties, assumptions, and other factors which may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Although the Company has attempted to identify important factors that could cause actual results or events to differ materially from those expressed or implied in the forward-looking statements (see “Risks and Uncertainties” in this MD&A), there may be other factors, such as the coronavirus global pandemic, which could cause results not to be as anticipated, estimated, described, or intended. Investors are cautioned against attributing undue certainty or reliance on forward-looking statements or information.

Forward-looking statements and information contained herein are made as of the date of this MD&A and the Company does not intend and disclaims any obligation to update or revise forward-looking statements or information, whether as a result of new information, future events, or to reflect changes in assumptions or in circumstances or any other events affecting such statements or information, other than as required by applicable law.

VanadiumCorp Resource Inc., MD & A for the period ended July 31, 2022.

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Mr. Paul McGuigan, P. Geo., of Cambria Geosciences Inc., a Qualified Person under NI 43-101 and a senior consulting geoscientist and Director of the Company, has reviewed and approved the technical disclosure in this management discussion and analysis.


VanadiumCorp Resource Inc. (“VanadiumCorp” or the “Company”) was incorporated under the Corporations Act (British Columbia) as Homestead Resources Inc. on October 23, 1980. The Company and its subsidiaries are engaged in the acquisition, exploration, and development of mineral properties in Canada, with a primary focus on the exploration of the Lac Dore and Iron-T Properties in Quebec that are mostly prospective for vanadium, titanium, and iron.

Additionally, the Company is also engaged in research in novel hydrometallurgical processes for recovering vanadium, iron, and titanium products from various feedstocks (principally titanomagnetite) and industrial waste streams.

The Company’s registered office is Suite 400 – 1505 West 2nd Avenue, Vancouver, British Columbia, V6H 3Y4. The Company is a publicly-traded junior resource company. It is classified as a Tier 1 company on the TSX Venture Exchange, where its trading symbol is “VRB”. The Company’s trading symbol on the Frankfurt Stock Exchange is “NWN.F” and “VRBFF” on the United States OTC Markets.

On March 11, 2022, Mr. Adriaan Bakker was removed as CEO of the Company and Mr. Paul McGuigan was appointed the interim CEO.

Effective April 18, 2022, the Company consolidated its issued and outstanding common shares on a 10 to 1 basis. All references to common shares, warrants and stock options prior to this date in this report have been adjusted to reflect the change.

In September, 2022, the Company closed the first tranche of a non-brokered private placement consisting of flow-through and non-flow-through units for a gross aggregate total of $1,315,200.


Iron-T Property, Quebec

The Iron-T Property is located in the Nord-du-Québec administrative region in the Province of Quebec, approximately 15 km east of the town of Matagami and 780 km northwest of Montreal. The Property straddles the townships of Isle-Dieu, Lozeau, Galinée and Comporté on NTS map sheets 32F11 (Rivière Opaoca), 32F12 (Ile Bancroft), 32F13 (Matagami) and 32F14 (Lac Olga).

All mineral titles are held 100% by the Company. The Property currently consists of one block of 86 claims staked by electronic map designation (“map-designated cells”), for an aggregate area of 4,789.0 hectares.

The Company has performed minimal work on the Iron-T Property since 2014. Several mining companies have conducted exploration work since 1958 on or in the vicinity of the actual Iron-T Property. The main interest was directed toward base metals mineralization following initial discoveries in the Matagami mining camp. VanadiumCorp (Apella Resources Inc. at the time) first worked the Iron-T Property in 2007. The Company reviewed the historical diamond drilling completed on the Iron-T Property from existing historical logs, sections, and maps. The most significant drilling results in regard to oxide mineralization were generated by Juna Mining & Exploration Ltd, SDBJ and Noranda. Maxime Dupéré, P.Geo. of SGS Geostat validated that historical drilling information.

Starting in 2009, VanadiumCorp completed a first and second drill campaign totalling 27 diamond drill holes and 2 trenches totalling 3,470 meters. This drilling to May 13th, 2010, was utilized in a maiden mineral resource estimation (The “2010 MRE”) issued by Maxime Dupéré, P.Geo. of SGS Geostat, titled, “Technical Report Vanadium-Titanium-Iron Resource Estimation of the Iron-T Property Matagami Area, Quebec, Canada.” The report presented a mineral resource measuring 11.63 Mt bearing 37.88% Fe2O3, 6.33% TiO2 and 0.40% V2O5 in the inferred category using a cut-off grade of 0.48% V2O5. This historical estimate is not considered a current estimate by the Company.

The 2010 MRE recommended continuing drilling and provided a purely conceptual budget of $2,623,500. The SGS budget includes 11,000 meters of diamond drilling excluding numerous program support costs, which would be an additional cost.

VanadiumCorp Resource Inc., MD & A for the period ended July 31, 2022.

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By July 21, 2010, VanadiumCorp had completed a third drilling campaign totalling over 2,349 meters and sampling 3 trenches also in the Lac Olga-Ouest mineralized zone.

In 2011, a mineral resource estimate (the “2011 MRE”) was issued on behalf of the Company for the Lac Olga-Ouest mineralized occurrence (the “Genesis Zone”). A report by M. Dupere, P.Geo. of SGS Canada Inc. – Geostat, titled “Technical Report – Resource Update of the Iron-TVanadium-Titanium-Iron Property, Matagami Area, Quebec” dated May 19, 2011, stated that the zone contains 14.37 Mt bearing 39.04% Fe2O3, 6.55% TiO2 and 0.42% V2O5 in the inferred category using a cut-off grade of 0.48% V2O5. This historical estimate is not considered a current estimate by the Company.

The 2011 MRE was prepared using the results of the 2009-2010 drilling program. However, the Company conducted further drilling in 2011, and these results were not included in the resource estimate.

Drilling programs from 2009 to 2011 revealed a further potential for mineralization on the Property.

  • Specifically, down-dip and step-out drill holes intersected mineralization with similar grades to those from the 2011 resource area, thereby demonstrating that the Main Zone remains open at depth and along trend.
  • Several holes drilled in the Lac Shallow-Ouest area in the western half of the Property intersected V-Ti-Fe mineralization with similar features to the Lac Olga- Ouest showing, specifically the grades, the geological setting, and the coincident broad geophysical signature.
  • Consistent drill results, trench samples and aeromagnetic responses along the entire 22 km strike length indicate remarkably similar geology to the Lac Doré Vanadium Project, including virtually no impurities and exceptional metallurgical recoveries.

Priority for exploration shifted to the Company’s Lac Dore Property in 2013, and the Iron-T was put on maintenance only.

The Iron-T Property is located within the Matagami volcanic complex in the northern part of the Abitibi Greenstone Belt, which represents one of several EW trending belts composed of a series of volcanic, sedimentary, and intrusive rocks within the Superior Province. Sharpe (1968) defined the stratigraphy of the Matagami area and identified two Archean volcanic packages, the Watson Lake Group marking the first of two phases of Archean volcanism characterized by the extrusion of bimodal Fe-rich, tholeiite volcanic rocks. The overlying Wabassee Group is characterized mainly by calc- alkaline basaltic to andesitic volcanics with some localized felsic units near its base.

The Watson Lake and Wabassee groups are intruded by the Bell River Complex, a large, 750 km2 layered synvolcanic intrusion dated 2724.6 ± 2.5 Ma (Mortensen, 1993). The Iron-T Property includes a few historical V-Ti-Fe mineralized occurrences and showings in the Bell River Complex (e.g., Lac Olga-Ouest and Lac Shallow-Ouest), as well as magmatic Cu-Ni mineralization (Lac Shallow-Est).

Geological setting and mineralization encountered on the Iron-TVanadium-Titanium-Iron Property located in the Bell River Complex indicate many similarities with typical large magmatic Fe- Ti-V oxide deposits associated with a layered intrusive complex consisting mainly of layered and massive concentrations of titanomagnetite, titaniferous magnetite, magnetite, and ilmenite.

The vanadium mineralization is associated with titanomagnetite, magnetite and ilmenite layers within the layered ferrogabbro zone. Vanadium is mainly associated with titanomagnetite and magnetite mineral species.

Taner et al. (1998) conducted a mineralogical and petrological study of vanadium mineralization in the Bell River and Lake Doré Complex. This study indicates that vanadium mineralization is associated with magnetite and ilmenite layers within the layered ferrogabbro zone of the upper part of the Bell River Complex. The oxide-rich gabbro horizons varying in width from 10 to 100 m clearly appear on the airborne regional magnetic survey. The oxide-rich gabbro is a mineralized cumulate forming either homogeneous horizons with disseminated oxide mineral contents ranging from 20 to 60% or massive homogeneous layers with oxide mineral contents varying from 60 to 90%. Massive oxide mineralized bands are interlayered with poorly mineralized gabbro forming pluri-centimetric to decimetric scale interlayers. The mineralized layering of the gabbro dips north from 75˚ to 85˚.

On October 30, 2019, the Company announced it had entered into a definitive agreement (the “Agreement”) with 11626191 Canada Inc., a private company (“Private Company”) whereby the issuer can earn a 100% interest in the Property. On March 12, 2020, the Company announced in a press release that the project transaction had closed.

VanadiumCorp Resource Inc., MD & A for the period ended July 31, 2022.

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Private Company has the right to:

  • Earn a 75% interest on completion of $5 million in exploration expenditures and $1 million in cash and stock payments to VanadiumCorp before the 4th anniversary of the signing of the Agreement (“First Option”).
  • Earn an additional 10% interest on completion of a preliminary economic assessment (“Second Earn-in”); and
  • Earn an additional 15% interest on completion of a positive feasibility study (“Third Earn-in”).

After receipt of $25,000 upon signing a Letter of Intent, the Private Company defaulted on its commitments and as of October 31, 2021, the Agreement has been terminated.

Lac Dore Property, Québec

The Company holds 100% ownership in the Lac Dore Vanadium, Iron and Titanium Property (“Lac Dore Property”). The Lac Dore Property is located approximately 27 km east-southeast from the city of Chibougamau, in Eeyou Istchee James Bay Territory, Nord-du-Québec administrative region, Province of Québec, Canada. The center of the Property lies at approximately Latitude 49°50’N, Longitude 74°0’W. The Property comprises two discontinuous groups of claims that straddle the border between National Topographic System (NTS) map sheets 32G-16 and 32H-13:

  • Lac Dore Main, holding mineral tenures over the Lac Dore deposit and is comprised of 23 claims of 648.8 hectares area.
  • Lac Dore North to the north, straddling strike extensions of the Lac Dore deposit is comprised of 15 claims of 701.9 hectares area.
  • Lac Dore Extension that abuts Lac Dore North and is mostly west of the Main/North mineralized horizon. It is currently comprised of 86 claims of 4,789.0 hectares area. The Company recently abandoned 2,116.8 hectares of claims in the northwestern extremity because they are not mineralized.

The Lac Dore magnetite deposit was discovered in 1948 through an aeromagnetic survey and has since been the subject of historical exploration by several companies with work carried out, including mapping, channel sampling, drilling, metallurgical test work, resource estimates, and feasibility studies. A large amount of historical data is available, but historical data considered most relevant are:

  • The results of an extensive drilling program carried out by SOQUEM Inc. (SOQUEM), beginning in 1979.
  • A 1997 stripping and sampling program by McKenzie Bay Resources Ltd (McKenzie Bay), including sampling and assaying of 1734 diamond-cut samples along a series of northwest-southeast lines.
  • Seven drillholes completed by McKenzie Bay on the ground now held by the Company (i.e. within the current claim holdings).
  • Four drillholes were completed by the Company (recorded as PacificOre Mining in the assessment filing registry) in 2013. Although conducted by the Company, they are considered historical as they were not drilled as part of the most recent program.
  • Other than drilling, the Company carried out several ground magnetic surveys between 2009 and 2013.

The Lac Dore Property is located at the northeast end of the Abitibi greenstone belt, which is host to several Archaean mafic intrusions, including the Lac Dore Complex (LDC) near Chibougamau, which has been emplaced into volcano- sedimentary host rocks and has in turn been intruded by the felsic Chibougamau Pluton.

The LDC is a layered mafic complex and is comparable to other better-known complexes such as the Bushveld Complex in South Africa, and the Lac Dore Property area (located in the Layered Zone of the LDC) is underlain by anorthosite, gabbro, magnetitite, and pyroxenite in varying proportions.

Magnetite deposits in layered complexes such as at Lac Dore are formed through primary magmatic processes, and the magnetite-bearing units (as well as the intervening mafic rocks that may contain minor amounts of magnetite) are generally continuous along strike. This is the case at Lac Dore, where magmatic layering has formed several magnetite- rich or magnetite-poor lithologies zones. Based on the detailed correlation of lithological units logged during the 2019- 2020 exploration campaign, a magmatic stratigraphy comprising nine units has been defined (PO, P1, P2-LOW,P2-A, P2- PART, P2-B,P2-HW P3, P3-HW).

VanadiumCorp Resource Inc., MD & A for the period ended July 31, 2022.

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Mineralization is in the form of vanadiferous-titanomagnetite (VTM), which forms a significant proportion of the lithologies and in some cases may make up close to 100% of the lithological unit. Each of the mineralized zones varies in thickness across the 3 km of strike, as outlined, and the entire mineralized zone varies between 200 m and 300 m in thickness. The lithologies and overall magmatic stratigraphy, dip at approximately 50–60° to the southeast and have been drill tested to depths of at least 220 m below the surface.

The concentration of vanadium and titanium within the magnetite varies with stratigraphic height. The magnetite from stratigraphically lower units (P1, P2-LOW) are more enriched in vanadium, and have relatively low titanium levels, whereas stratigraphically higher levels (P3) have lower vanadium and higher titanium in magnetite. Titanium and vanadium levels in magnetite remain relatively constant within units and along strike.

Exploration and drilling in 2019 and 2020 were managed by lnnovExplo Consultants, who also provided the consulting geologists who carried out the logging, sampling, and database management at the project. The Company retained CSA Global Consultants Canada Limited (“CSA”), with Dr. Luke Longridge, P. Geo. as the lead consultant. CSA produced a Technical Report titled “Lac Doré Project, Chibougamau, Québec, Canada, Dec. 10, 2020.” The full technical report is available on the Company’s website and SEDAR.

The Company commissioned an airborne light detection and ranging (LiDAR) survey in 2020 and a detailed digital terrain model (DTM) prepared. Several historical trenches were partially resampled for verification purposes in 2019, using channel sampling.

During 2019 and 2020, VanadiumCorp carried out drilling of 37 new diamond drill holes (9,601.8m) and resampling old drill core and surface channel samples.

Drilling at the Lac Dore Project was carried out in September and October 2019 by Miikan Drilling Ltd of Chibougamau. NQ diameter diamond drill core was delivered to the Company’s core facility in Chibougamau at the end of each shift. The drilling program and drilling contractors were managed by lnnovExplo Consultants, who also provided consulting geologists who carried out the logging, sampling, and database management. An independent surveyor surveyed drill collars. Downhole azimuth and dip measurements were taken every run using a gyro-based Reflex instrument.

Core was split using a diamond saw and sampled predominantly 1.5 m intervals. Samples were shipped to SGS Canada Inc.’s facilities in Val d’Or and Québec City, Québec for preparation, and were analyzed using x-ray fluorescence (XRF) spectroscopy at SGS Canada lnc.’s Lakefield facility for Whole Rock Analysis. The suite of elements analyzed includes SiO2, Al2O3, Fe2O3, MgO, CaO, Na2O, K2O, TiO2, P2O5, MnO, Cr2O3, V2O5, and loss on ignition (LOI).

QAQC samples comprising 5% each of standards and blanks were included with each shipment. The certified reference materials (CRMs) used by VanadiumCorp were supplied by AMIS (A Division of Torre Analytical Services (Pty) Limited, South Africa) including AMIS0567, AMIS0501, and AMIS0347. Blanks include both certified blank materials and silica sand. Results for CRMs and banks indicate no bias or contamination in the samples. Internal laboratory duplicate analyses show an excellent correlation between original and repeat analyses, indicating no nugget effect.

Data Verification of historical results included resampling the 1997 trenches/channels originally sampled by McKenzie Bay (202 channel samples selected from 13 trenches), complete resampling of 2013 drill core (210 quarter-core samples), and twinning of several historical holes. Comparison of historical data with current data verifies and validates the use of the historical data. Longridge (2020) is of the opinion that the data from the Lac Dore Project (with particular reference to 2019 drilling) is acceptable for Mineral Resource estimation. Analytical results are considered to pose minimal risk to the overall confidence level of the MRE.

Metallurgical test work was limited to magnetic separation carried out using Davis Tube tests at SGS Canada Inc.’s facilities in Val-d’Or, Québec, to create magnetite concentrates which were then assayed to evaluate the iron, vanadium and titanium grades of the concentrates Samples were composited from pulp rejects previously prepared for assay. Samples were selected from all stratigraphic zones identified within the deposit. Magnetite content correlates with the iron content of the head grade, whereas vanadium contents vary by stratigraphic zone, with lower stratigraphic zones (P0, P1, P2-LOW) having elevated V2O5 values in the concentrate (approximately 1.4% to 1.6% V2O5), with the stratigraphically highest zone (P3 having grades of approximately 0.8% to 1.0% V2O5). The iron grade of the concentrates varies but on average remains constant at about 62%. Titanium grades of the concentrates show a linear inverse correlation with the vanadium grade of the concentrate.