UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 2023
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______________ to _______________
000-54416
(Commission File Number)
Scandium International Mining Corp.
(Exact Name of Registrant as specified in its charter)
British Columbia, Canada
(State or other Jurisdiction of Incorporation
or organization)
98-1009717
(I.R.S. Employer
Identification No.)
2011 Phaeton Lane, Reno, Nevada
(Address of Principal Executive Offices)
89521
(Zip Code)
Registrant’s Telephone Number, including area code: (775) 355-9500
Securities registered pursuant to Section 12(b) of the Act: None
Securities to be registered pursuant to Section 12(g) of the Act:
Common Shares without par value
(Title of class)
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the
Securities Act. Yes [ ] No [X]
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d)
of the Act. Yes [ ] No [X]
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes [X] No [ ]
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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File
required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes
[X] No [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-
accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of
“large accelerated filer,” “accelerated filer” “smaller reporting company” and “emerging growth company”
in Rule 12b-2 of the Exchange Act (Check one):
Large Accelerated Filer
Non-Accelerated Filer
Accelerated Filer
Smaller Reporting Company
Emerging Growth Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended
transition period for complying with any new or revised financial accounting standards provided pursuant
to Section 13(a) of the Exchange Act. [ ]
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s
assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the
Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued
its audit report. [ ]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes [ ] No [X]
State the aggregate market value of the voting and non-voting common equity held by non-affiliates
computed by reference to the price at which the common equity was sold, or the average bid and asked
price of such common equity, as of the last business day of the registrant’s most recently completed second
fiscal quarter: $12,097,817 as at June 30, 2023.
Indicate the number of shares outstanding of each of the registrant’s classes of common equity, as of the
latest practicable date: 355,860,813 common shares as at March 26, 2024.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's Proxy Statement for the Annual Meeting of Stockholders are incorporated by
reference into Part III of this Form 10-K, which Proxy Statement is to be filed within 120 days after the end
of the registrant's fiscal year ended December 31, 2023.
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TABLE OF CONTENTS
Note about Forward-Looking Statements ..................................................................................................... 4
Glossary of Terms ......................................................................................................................................... 4
ITEM 1. BUSINESS .................................................................................................................................... 7
ITEM 1A. RISK FACTORS ...................................................................................................................... 11
ITEM 2. PROPERTIES, PROJECTS, AND PATENTS ......................................................................... 133
ITEM 3. LEGAL PROCEEDINGS ........................................................................................................... 27
ITEM 4. MINE SAFETY DISCLOSURES ............................................................................................... 28
ITEM 5. MARKET FOR REGISTRANTS’ COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES .................................................... 28
ITEM 6. SELECTED FINANCIAL DATA .............................................................................................. 30
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
RESULTS OF OPERATIONS ................................................................................................................... 30
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK ........ 36
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA............................................ 36
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE ..................................................................................................................... 37
ITEM 9A. CONTROLS AND PROCEDURES ........................................................................................ 37
ITEM 9B. OTHER INFORMATION ........................................................................................................ 37
ITEM 15. EXHIBITS, FINANCIAL STATEMENTS SCHEDULES ...................................................... 38
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Note about Forward-Looking Statements
PART I
Certain statements contained in this annual report on Form 10-K and the documents incorporated by
reference herein constitute "forward-looking statements.” Forward-looking statements may include, but
are not limited to, statements with respect to the future price of commodities, the estimation of mineral
resources, the realization of mineral resource estimates, the timing and amount of estimated future
production, costs of production, capital expenditures, costs and timing of the development of new deposits,
success of exploration activities, our ability to fund property acquisition costs, our ability to reach targeted
time frames for establishing feasibility, permitting time lines, currency fluctuations, requirements for
additional capital, government regulation of mining operations, environmental risks, unanticipated
reclamation expenses, title disputes or claims, our ability to raise funds necessary for ongoing and planned
expenditures and operations, and regulatory approvals. In certain cases, forward-looking statements can be
identified by the use of words such as "plans,” "expects" or "does not expect,” "is expected,” "scheduled,”
"estimates,” "intends, "anticipates" or "believes,” or variations of such words and phrases or state that
certain actions, events or results "may,” "could,” "would" or "will be taken,” "occur" or "be achieved.”
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may
cause our actual results, performance or achievements to be materially different from any future results,
performance or achievements expressed or implied by the forward-looking statements. Such factors may
include, among others, risks related to our joint venture operations; actual results of current exploration
activities or production technologies that we are currently testing; actual results of reclamation activities;
future metal prices; accidents, labour disputes and other risks of the mining industry; delays in obtaining
governmental or regulatory approvals or financing or in the completion of development activities, as well
as those factors discussed in the section entitled "Risk Factors" and elsewhere in this Form 10-K. Although
we have attempted to identify important factors that could cause actual actions, events or results to differ
materially from those described in forward looking statements, there may be other factors that cause actions,
events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-
looking statements will prove to be accurate, as actual results and future events could differ materially from
those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-
looking statements.
Glossary of Terms
“Company,” “SCY,” “we,” “us,” “our” and similar words of similar meaning refer to Scandium
International Mining Corp.
$, A$, C$
Assay
Exploration stage
issuer
Exploration stage
property
mean respectively, United States dollars, Australian dollars and Canadian
dollars.
An analysis to determine the presence, absence or quantity of one or more
components, elements or minerals.
An issuer that has no material property with mineral reserves disclosed.
A property that has no mineral reserves disclosed.
Grade
The concentration of a valuable mineral within an Ore.
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hematite
Igneous
Intrusion
Kg
Km
laterite
Limonite
Mineralization
Mineral reserve
Mineral resource
A mineral composed of iron oxide minerals.
A rock formed by the cooling of molten silicate material.
A general term for a body of igneous rock formed below the surface of the
earth.
Kilogram which is equivalent to approximately 2.20 pounds.
Kilometer which is equivalent to approximately 0.62 miles.
Soil layer rich in iron dioxide.
an iron ore consisting of a hydrous ferric oxide of variable composition.
A term used to describe the presence of minerals of possible economic value.
Also used to describe the process by which concentration of economic
minerals occurs.
An estimate of tonnage and grade or quality of indicated and measured
mineral resources that, in the opinion of the qualified person, can be the basis
of an economically viable project. More specifically, it is the economically
mineable part of a measured or indicated mineral resource, which includes
diluting materials and allowances for losses that may occur when the material
is mined or extracted.
A concentration or occurrence of material of economic interest in or on the
Earth's crust in such form, grade or quality, and quantity that there are
reasonable prospects for economic extraction. A mineral resource is a
reasonable estimate of mineralization, taking into account relevant factors
such as cut-off grade, likely mining dimensions, location or continuity, that,
with the assumed and justifiable technical and economic conditions, is likely
to, in whole or in part, become economically extractable. It is not merely an
inventory of all mineralization drilled or sampled. Includes measured,
indicated and inferred mineral resources, as defined below:
“measured mineral resource” is that part of a mineral resource for which
quantity and grade or quality are estimated on the basis of conclusive
geological evidence and sampling. The level of geological certainty
associated with a measured mineral resource is sufficient to allow a qualified
person to apply modifying factors, as defined in this section, in sufficient
detail to support detailed mine planning and final evaluation of the economic
viability of the deposit. Because a measured mineral resource has a higher
level of confidence than the level of confidence of either an indicated mineral
resource or an inferred mineral resource, a measured mineral resource may
be converted to a proven mineral reserve or to a probable mineral reserve.
“indicated mineral resource” is that part of a mineral resource for which
quantity and grade or quality are estimated on the basis of adequate
geological evidence and sampling. The level of geological certainty
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associated with an indicated mineral resource is sufficient to allow a qualified
person to apply modifying factors in sufficient detail to support mine
planning and evaluation of the economic viability of the deposit. Because an
indicated mineral resource has a lower level of confidence than the level of
confidence of a measured mineral resource, an indicated mineral resource
may only be converted to a probable mineral reserve.
“inferred mineral resource” is that part of a mineral resource for which
quantity and grade or quality are estimated on the basis of limited geological
evidence and sampling. The level of geological uncertainty associated with
an inferred mineral resource is too high to apply relevant technical and
economic factors likely to influence the prospects of economic extraction in
a manner useful for evaluation of economic viability. Because an inferred
mineral resource has the lowest level of geological confidence of all mineral
resources, which prevents the application of the modifying factors in a
manner useful for evaluation of economic viability, an inferred mineral
resource may not be considered when assessing the economic viability of a
mining project, and may not be converted to a mineral reserve.
Net smelter returns
royalty
A share of the net revenues generated from the sale of metal produced by a
mine.
NI 43-101
Ore
ppm
National Instrument 43-101 – Standards for Disclosure of Mineral Projects,
being the regulation adopted by Canadian securities regulators that governs
the public disclosure of technical and scientific information concerning a
mineral property.
A naturally occurring solid material from which a metal or valuable mineral
can be profitably extracted.
Parts per million.
Qualified person
Means a qualified person as defined in S-K 1300, including an engineer or
geoscientist in good standing with their professional association, with at least
five years of relevant experience.
saprolite
Soft, friable, isovolumetrically weathered bedrock that retains the fabric and
structure of the parent rock.
S-K 1300
Item 1300 of Regulation S-K of the 1933 Securities Act.
Tpy
Tonne
Tonnes per year.
A metric ton which is equivalent to approximately 2,204 pounds.
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ITEM 1. BUSINESS
General
We were incorporated on July 17, 2006, under the laws of British Columbia, Canada under the name Golden
Predator Mines Inc. We were incorporated as a wholly owned subsidiary of Energy Metals Corp. for the
purpose of holding precious metals and certain specialty metals assets. In order to focus on specialty metals,
during February 2009 we transferred most of our precious mineral assets to our then wholly owned
subsidiary Golden Predator Corp., and on March 6, 2009, we completed a spin-out of Golden Predator
Corp. to our shareholders. Effective March 12, 2009, we changed our name to EMC Metals Corp. In order
to reflect a new emphasis on mining for scandium minerals, effective November 19, 2014, we changed our
name to Scandium International Mining Corp (“SCY” or the “Company”).
We are a reporting issuer in the Canadian Provinces of British Columbia, Alberta and Ontario and our
common shares are listed for trading on the Toronto Stock Exchange under the trading symbol “SCY.”
Our head office is located at 2011 Phaeton Lane, Reno, Nevada 89521. The address of our registered office
is 1200 - 750 West Pender Street, Vancouver, British Columbia, Canada, V6C 2T8.
Our most advanced project is the Nyngan Scandium Project, located in New South Wales, Australia (the
“Nyngan Scandium Project”), on which we hold a mine lease grant and a development consent. We also
hold an exploration license on a scandium mineral property located near Nyngan known as the “Honeybugle
Scandium property.” We did not renew an exploration license on a scandium mineral property in Finland,
known as the “Kiviniemi Scandium property.”
In November 2023 we commenced physical development of the Nyngan Scandium Project
following the results of the 2023 Nyngan drilling program which better defined the western
boundary of the existing resource. The actions included:
• Survey conducted of the site to establish and peg the boundaries for proposed work in
accordance with State Significant Development 5157 (“SSD 5157”).
• Soil management works including the establishment of water exclusion embankments and the
stripping of topsoil, with subsequent stockpiling.
• Construction and placement of temporary office quarters at the site for future site development
activities.
In the first quarter of 2023, we completed a drilling program at the Honeybugle Scandium
Project which discovered a new Scandium enriched laterite formation approx. 2 meters below the
surface area at the Woodlong prospect within the Honeybugle Exploration License 7977 area,
where 32 vertical air core holes were drilled in an approximately 300m x 400m area.
During the first quarter of 2022, SCY completed an internal review of its portfolio of assets and
projects. The purpose of this review was to determine the appropriate allocation of capital between
the Company’s scandium activities and the recently announced initiatives on Critical Metals
Recovery (CMR) and High Purity Alumina (HPA). The board decided and announced on April
18, 2022, that the best return on invested capital for its shareholders was to prioritize the
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Company’s portfolio of scandium assets including the Nyngan Scandium Project, and to idle its
CMR and HPA initiatives. As a result of the review, leadership changes were also made with the
appointment of a CEO and CFO and a downsizing of the board to four directors.
As its first priority, the new management completed a C$3.4 million non-brokered equity private
placement which replenished cash balances and eliminated negative working capital. The second
priority was to reduce costs, and the Company has been successful in reducing corporate G&A
costs, including being able to reverse over $1 million in accruals during 2022.
Our plan of operation for 2024 is to continue to advance commercial discussions with potential offtake
partners. The completion of a sufficient offtake agreements totalling a minimum quantity is the critical
factor to enable the Company to be in a position to consider taking a Final Investment Decision to put the
Nyngan Scandium Project into production. At the same time, the capital raise in 2022, positive working
capital and no debt, and the reduction of operating costs have given the Company time to be in a position
to benefit from the growing market adoption of scandium.
Intercorporate Relationships
The chart below illustrates our corporate structure on December 31, 2023, including our subsidiaries, the
jurisdictions of incorporation, and the percentage of voting securities held.
Pursuant to a share exchange agreement dated June 30, 2017, the Company acquired the remaining 20%
interest in EMC Metals Australia Pty. Ltd. from Scandium Investments LLC (“SIL”). On completion of the
share exchange, the Company issued an aggregate of 58,830,645 common shares to SIL and granted to SIL
the right to nominate two individuals to the board of the Company for so long as SIL holds at least 15% of
SCY’s issued and outstanding shares, and one director for so long as SIL holds at least 5% but less than
15% of SCY’s issued and outstanding shares.
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Business Operations
Company, Projects and Markets Summary
We are a mineral exploration and development company that is at an exploration stage. Our most advanced
project is the Nyngan Scandium Project, located in New South Wales, Australia (the “Nyngan Scandium
Project”), on which we hold a mine lease grant, a development consent, and 100% of the mineral rights.
The Company has completed a definitive feasibility study on the Nyngan Scandium Project dated May 4,
2016 (the “Feasibility Study” or “DFS”), which was prepared independently in accordance with NI 43-101.
The results of the DFS include a 16.9 million tonne measured and indicated resource (grading 235ppm at a
100ppm cut-off) and a 1.43 million tonne mineral reserve (combined proven and probable), based on
economics established in that study.
The Company also holds an exploration license on the Honeybugle Scandium property, located 24
kilometers from the Nyngan Scandium Project, granted in 2014.
Corporate Objectives and Strategy
Our corporate focus is the development of projects that enable the production and sale of scandium and
scandium-based products.
The Nyngan Scandium Project remains the most advanced project in the Company portfolio at this time,
with permitting largely complete and a published DFS on SEDAR. Subject to successful construction
financing and customer sales agreements, we intend to develop the Nyngan Scandium Project for
production and supply of scandium oxide and scandium-content products. For further information on the
Nyngan Scandium Project, please refer to “Item 2. Properties - Description of Mineral Projects – Nyngan
Scandium Project” and “Item 1A. Risk Factors.”
Product Markets for Scandium
Scandium is the 31st most abundant element in the earth’s crust (average 33 ppm), which makes it more
common than lead, mercury, and precious metals, but less common than copper. Scandium has
characteristics that are similar to rare earth elements, and it is often classified as a member of that group,
although it is technically a light transition metal. Scandium occurs in nature as an oxide, rarely occurs in
concentrated quantities because it does not selectively combine with the common ore-forming anions and
is very difficult to reduce to a pure metal state. Scandium is typically produced and sold as a powder, in
oxide form, and known as scandium oxide, scandia or Sc2O3.
Global annual production estimates of scandium range from 15 tonnes to 20 tonnes, but accurate statistics
are not available due to the lack of public information from countries in which scandium is currently being
produced, specifically China and Russia. Two sources of scandium production outside of China and Russia
have commenced production. The Taganito Nickel Mine in the Philippines (Sumitomo Metal Mining Co.,
Ltd.) reported sales of 16 tonnes of Scandium Oxalate in 2021.
In October 2022, Rio Tinto announced that Rio Tinto Fer et Titane in Quebec plans to quadruple scandium
oxide production capacity to 12 tonnes from its current 3 tonne per annum capacity. This C$30-35 million
expansion is expected to produce incremental scandium oxide in 2024. The entrance of Rio Tinto into the
production of scandium oxide is considered to be confirmation of the growth of the scandium market.
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There is no reliable pricing data on global scandium oxide trading. Scandium oxide is typically traded in
small quantities, between private parties, and pricing is not transparent to other buyers or sellers as there is
no clearing facility as is more common with commercially traded metals and commodities. The U.S.
Geological Survey (“USGS”) in its latest available report (dated January 2022) documents the 2021 price
of scandium oxide (99.99% grade) at US$2,200/kg, indicating a significant reduction from the 2020 price
estimate of US$3,800/kg. They also estimate the global sales of scandium oxide to be between 15-25 tpy,
principally from China, Russia and the Philippines.
Prices vary, based on purity and quantity supplied. The USGS pricing generally reflects small volume sales,
with larger quantities selling at lower prices, typically under US$2,000/kg. USGS reporting also
acknowledged that ex-works China prices for 99.99% purity oxide were considerably lower than US-
observed prices in 2021, based on underutilization of existing Chinese production capacity. Scandium oxide
grades of 95-99% are generally considered suitable for manufacturing AlSc 2% master alloy, the form
demanded for aluminum alloy applications.
Scandium can also be effectively purchased in the form of aluminum-scandium (Al-Sc) master alloy,
typically containing 2% scandium by weight. This product is the preferred form for manufacture of
aluminum alloys containing scandium. The current January 2022 USGS report indicates the 2021 price for
Al-Sc 2% master alloy at US$350/kg, slightly higher than the 2020 USGS average. Recent USGS estimated
prices fo/r Al-Sc 2% master alloy have also been high relative to commonly available prices ex-works
China, which have trended under US$100/kg and are available in one tonne lots or greater today.
Principal uses for scandium are in high-strength aluminum alloys, solid oxide fuel cells, high-intensity
metal halide lamps, electronics, and laser research. Recently developed applications include welding wire.
Approximately 15 different commercial aluminum-scandium alloys have been developed, and some of
them are used for aerospace applications. In Europe and the U.S., scandium-containing alloys have been
evaluated for use in structural parts in commercial airplanes and high stress parts in automobile engines and
brake systems. Military and aerospace applications are known to be of interest, although with less
specificity. The combination of high strength, weldability and ductility makes aluminum-scandium alloys
potentially attractive replacements for existing aluminum alloys in a number of applications where
improved alloy properties can add value to final products.
Competitive Conditions
We compete with numerous other companies and individuals in the search for and the acquisition or control
of attractive rare earth and specialty metals mineral properties and opportunities. Our ability to profitably
build a portfolio of commercial operations in this market segment will depend on our acquisition success
in finding and securing attractive positions for development, our ability to operate the plants and facilities
we commit to construct, and our success in marketing the products we manufacture against competing
producers in the marketplace.
In regard to our plan to produce scandium, there are a limited number of scandium producers presently. If
we are successful at becoming a producer of scandium, our ability to be competitive will require that we
establish a reliable supply of scandium to the market, delivered at purity levels demanded by various
applications, and that our operating costs generate satisfactory margins, recognizing true prices will be set
by customers and competitors in a market that is yet to mature.
Governmental Regulations and Environmental Laws
The development of any of our mining properties will require numerous local and national government
approvals and environmental permits. For further information about governmental approvals and permitting
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requirements, please refer to “Item 1A. Risk Factors” and Nyngan Scandium Project -
Environmental Permitting/Development Consent/Mining Lease below for additional information.
Employees
As at January 1, 2023, we have 5 full and part time employees. Our operations are managed by our officers
with input from our directors. We engage geological, metallurgical, and engineering consultants from time
to time as required to assist in evaluating our property interests and recommending and conducting work
programs.
ITEM 1A. RISK FACTORS
In addition to the factors discussed elsewhere in this Form 10-K, the following are certain material risks
and uncertainties that are specific to our industry and properties that could materially adversely affect our
business, financial condition and results of operations.
Risks Associated with the Nyngan Scandium Project
There are technical challenges to scandium production that may render the Nyngan Scandium Project
not economic. The economics of scandium recovery are known to be challenging. There are very few
facilities producing scandium and the existing scandium producers are secretive in their techniques for
recovery. In addition, the recovery of scandium product from laterite resources, such as are found on the
Nyngan property, has not been demonstrated at an operating facility. The Nyngan processing facility design,
if constructed, will be the first of its kind for scandium production. These factors increase the possibility
that we will encounter unknown or unanticipated production and processing risks. Should we encounter
any of these risks, they could increase the cost of production thereby reducing margins on the Nyngan
Scandium Project or rendering it uneconomic.
There is no guarantee that we will be able to finance the Nyngan Scandium Project for production. Any
decision to proceed with production on the Nyngan Scandium Project will require significant production
financing. Scandium projects are uncommon, and economic and production uncertainty may limit our
ability to attract the required amount of capital to put the project into production. If we are unable to source
production financing on commercially viable terms, we may not be able to proceed with the project and
may have to write off our investment in the project.
If we are successful at achieving scandium production, we may have difficulty selling scandium-
containing products longer term. Scandium is characterized by unreliable supply, resulting in limited
development of markets for scandium oxide. Markets may take longer to develop than anticipated, and
Nyngan and other potential scandium producers may have to wait for products and applications to create
adequate demand. Certain applications may require lengthy certification processes that could delay usage
or acceptance. In addition, certain scandium applications require very high purity scandium product, which
is much more difficult to produce than lower grade product. If we commence production, our inability to
supply scandium in sufficient quantities, in a reliable and timely manner, and in the correct quality, could
reduce the demand for any scandium produced from our projects and possibly render the project
uneconomic.
General Risks Associated with our Mining Activities and Company
We may not receive permits necessary to proceed with the development of any of our advancing projects.
The development of any of our mining properties, including the Nyngan Scandium Project, will require the
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acquisition and sustained possession of numerous local and national government approvals and permits.
Our ability to secure all necessary permits required to develop any of our projects is unknown until such
permits are received. If we cannot obtain or retain all necessary permits, the Nyngan Scandium Project
cannot be developed, and our investment in the project potentially will be lost. While the critical permits
for the Nyngan Scandium Project have been received, other permits remain outstanding at this time and
continuing compliance with the terms of the permits is required.
Mineral Resource Estimates on our properties are subject to uncertainty and may not reflect what may
be economically extracted. Resource estimates included for scandium on our Nyngan property are
estimates only and no assurances can be given that the estimated levels of scandium minerals will actually
be produced or that we will receive the metal prices assumed in determining our resources. Such estimates
are expressions of judgment based on knowledge, mining experience, analysis of drilling and exploration
results and industry practices. Estimates made at any given time may change significantly when new
information becomes available or when parameters that were used for such estimates change. By their
nature resource estimates are imprecise and depend, to a certain extent, upon statistical inferences which
may ultimately prove unreliable. Furthermore, market price fluctuations in scandium, as well as increased
capital or production costs or reduced recovery rates, may limit our ability to establish reserves at some
future point on Nyngan, or on any of our properties. The extent to which more Nyngan project resources
may ultimately be reclassified as proven or probable reserves is dependent upon the demonstration of their
profitable recovery. The evaluation of reserves or resources is always influenced by economic and
technological factors, which may change over time. Accordingly, further current resource estimates on our
material properties may never be converted into reserves, or be economically extracted, and we may have
to write off such properties or incur a loss on sale of our interest on such properties, which will likely reduce
the value of our shares.
Our operations are subject to losses due to exchange rate fluctuation. We maintain accounts in Canadian,
Australian, Euro and U.S. currency. Our equity financings have to date been priced in Canadian dollars. All
of our material projects and non-cash assets are located outside of both Canada and the USA, however, and
require regular currency conversions to local currencies where such projects and assets are located. Our
operations are accordingly subject to foreign currency fluctuations and such fluctuations may materially
affect our financial position and results. We do not engage in currency hedging activities.
We do not currently earn any revenue and without additional funding, we will not be able to carry out
our business plan, and if we raise additional funding existing security holders may experience dilution.
As an exploration stage mining company, none of our principal properties are in operation and we do not
currently earn any revenue. In order to continue our exploration activities and to meet our obligations on
the Nyngan Scandium Project, we will need to raise additional funds. Recently, we have relied entirely on
the sale of our securities to raise funds for operations. Our ability to continue to raise funds from the sale
of our securities is subject to significant uncertainty due to volatility in the mineral exploration marketplace.
If we are able to raise funds from the sale of our securities, existing security holders may experience
significant dilution of their ownership interests and possibly to the value of their existing securities.
Risks Related to the COVID-19 Pandemic. In March 2020, the World Health Organization declared
coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to
spread, and related adverse public health developments, have adversely affected workforces, economies,
and financial markets globally, leading to an economic downturn. It is not possible for the Company to
predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s
business or ability to raise funds.
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ITEM 2. PROPERTIES, PROJECTS AND PATENTS
Cautionary Note to U.S. Investors Regarding Resource Estimates
The Company’s technical disclosure in this section uses certain terms which are defined by the Canadian
Institute of Mining, Metallurgy and Petroleum, and required to be disclosed in accordance with Canadian
National Instrument 43-101 (“NI 43-101”). The disclosure standards in the United States Securities and
Exchange Commission’s (the “SEC”) Subpart 1300 of Regulation S-K contain significant differences from
the disclosure requirements of NI 43-101 and information presented in this section may not be comparable
with United States standards in documents filed with the SEC. Accordingly, information concerning
mineral deposits set forth in this section may not be comparable with information presented by companies
using only United States standards in their public disclosures.
Summary Disclosure of Mineral Projects
The Company holds two properties, the Nyngan Scandium Project in Australia, and the Honeybugle
Scandium Property in Australia, each of which is an exploration stage property. Only the Nyngan Scandium
Project is considered a material mineral property by the Company.
Location of Properties
Figure 1: Location of Properties in Australia
The Nyngan Scandium Project site is located approximately 450 kilometres northwest of Sydney, NSW,
Australia, and approximately 20 kilometres due west from the town of Nyngan, a rural town of
approximately 2,900 people. The deposit is located 5 kilometres south of Miandetta, off the Barrier
Highway that connects the towns of Nyngan and Cobar.
The Honeybugle Scandium property covers part of the Honeybugle geologic complex in New South Wales,
NSW, Australia, and is located approximately 24 kilometers west-southwest from the Company’s Nyngan
Scandium Project.
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Type and Amount of Ownership Interests
The Company holds a mine lease grant, a development consent, and 100% of the mineral rights on the
Nyngan Scandium Project. The scandium resource is held under one Mining License (ML1792) and three
exploration licenses (EL 8448, EL 8316 and EL6096). The exploration licenses allow the license holder to
conduct exploration on private land (with landowner consents and signed compensation agreements in
place) and public lands not including wildlife reserves, heritage areas or National Parks. The scandium
resource is fully enclosed on private agricultural land. The Company’s Australian subsidiary holds legal
title to specific surface and mineral exploration rights on the Nyngan Scandium Project. The exploration
licenses cover 29.25 square kilometers (2,925 hectares). The project surface rights (freehold) total 810 acres
(370 hectares).
The Company has a 100% interest in an exploration license (EL 7977) covering the Honeybugle Scandium
property. The Honeybugle Scandium property is 34.7 square kilometers.
Key Permit Conditions
The Company previously undertook permitting efforts required to obtain a mine lease grant and a
development consent on the Nyngan Scandium Project. In addition to these two key governmental
approvals, other required licenses and permits must be acquired for the Nyngan Scandium Project but are
considered routine and require only compliance with fixed standards and objective measurements. These
remaining approvals include submittal of numerous plans and reports supporting compliance with the
Company’s development consent and mining lease. In addition, certain water, roads, dam and electrical
access reviews and arrangements must be finalized. For additional details, see “Individual Property
Disclosure - Nyngan Scandium Project – Mining Lease.”
To date, no permitting efforts have been undertaken or are currently planned at the Honeybugle Scandium
property.
Mineralization Styles
The Honeybugle Scandium property’s mineralization has a high iron content with medium grade scandium,
located on or near surface.
Available Facilities
The Nyngan Scandium Project site is accessed from the Barrier Highway, a paved two lane all-weather
road connecting the town of Nyngan with Cobar. Adequate water supply is available for the project via raw
water supply lines, which are ultimately sourced from Burrendong Dam, located 230 kms to the southeast.
Grid electrical power is available in the form of separate 132kV, 66kV and 33kV lines, all run within 5 km
of the site.
The Honeybugle Scandium property is all-weather accessible and close to infrastructure.
Nyngan Scandium Project
Property Description and Location
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The Nyngan Scandium Project site is located approximately 450 kilometres northwest of Sydney, NSW,
Australia and approximately 20 kilometres due west from the town of Nyngan, a rural town of
approximately 2,900 people. The deposit is located 5 kilometres south of Miandetta, off the Barrier
Highway that connects the towns of Nyngan and Cobar. Final license area access is reached by clay farm
tracks. The general area can be characterized as flat agricultural land, used predominantly for wheat farming
and livestock grazing. Infrastructure in the area is good, including available water and electric power. The
property is classified as an Australia Property for financial statement segment information purposes.
The 2019 ML 1792 grant covers 810 acres (370 hectares) of surface area fully owned by the Company, an
area adequate to construct and operate a scandium mine of a scale outlined in the DFS. The book value of
the Nyngan Scandium Project is $704,053 and is entirely related to the acquisition cost of the land which
is unencumbered. There is no associated plant and equipment. The property has only been used for
agricultural purposes and there have been no previous natural resource operations or encumbrances.
The general location of the Nyngan Scandium Project is provided in Figure 1 below.
Figure 1: Location of Nyngan Scandium Project
Note: None of the Existing Mines identified in Figure 1 produce scandium.
The scandium resource is hosted within the lateritic zone of the Gilgai Intrusion, one of several Alaskan-
type mafic and ultramafic bodies which intrude Cambrian-Ordovician metasediments collectively called
the Girilambone Group. The laterite zone, locally up to 40 meters thick, is layered with hematitic clay at
the surface followed by limonitic clay, saprolitic clay, weathered bedrock and finally fresh bedrock. The
scandium mineralization is concentrated within the hematitic, limonitic, and saprolitic zones with values
up to 350 ppm scandium.
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Figure 2: Location of the Exploration Licenses and Mining Lease for the Nyngan Scandium
Project
Mineral License Details
The scandium resource is held under Exploration License (EL) 8316 (Block Number 3132, units d, e, j, k
and Block no. 3133, unit f) and EL 6096 (Block 3132, unit p, and Block 3133, units l, m, r and s); a total of
ten (10) graticular units. The exploration licenses allow the license holder to conduct exploration on private
land (with landowner consents and signed compensation agreements in place) and public lands not
including wildlife reserves, heritage areas or National Parks. The scandium resource is fully enclosed on
private agricultural land.
The Company’s Australian subsidiary holds legal title to specific surface and mineral exploration rights on
the Nyngan Scandium Project. During 2017, an additional EL (EL 8448) was granted. Figure 2 provides
details of the location of EL 8448 and the locations of Mining Lease 1792 and Mining Lease Application
531, both of which overlay the exploration license area.
The exploration licenses cover 29.25 square kilometers (2,925 hectares). The resource site is located at
geographic coordinates MGA zone 55, GDA 94, Lat: - 31.5987, Long: 146.9827, Map Sheets 1:250k –
Cobar (SH/55-14) and 1:100k Hermidale (8234).
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The project surface rights (freehold) total 810 acres (370 hectares) on the portion of the exploration license
area corresponding to the Mine Lease 1792 area. The freehold property boundaries are defined by standard
land survey techniques undertaken by the Lands Department and currently presented in the form of
Cadastral Deposited Plans (DP) and Lots. The land associated with the project rights is DP 752879, Lots 6
and 7 (Appendix 2, Lots 6 and 7 - Nyngan).
The Company is required to lodge individual A$10,000 environmental bonds with the NSW Mines
Department for each license and must meet total minimum work requirements annually of approximately
A$65,000, covering both licenses.
Royalties attached to the properties include a 1.5% Net Profits Interest royalty to private parties involved
with the early exploration on the property, a 1.7% Net Smelter Returns Royalty payable to Jervois for 12
years after production commences, subject to terms in the settlement agreement, and a 0.7% royalty on
gross mineral sales to a private investor. Another revenue royalty is payable to private interests of 0.2%,
subject to a US$370k cap. A NSW minerals royalty will also be levied on the project, subject to negotiation,
currently 4% on revenue.
Metallurgy Development
The Company has invested in and developed methodology for extracting scandium from the Nyngan
property resource since 2010. A portion of the work done over this period has been superseded by work
that followed, but subsequent test programs universally benefitted from prior efforts. In summary, the
programs have been as follows:
• 2010 – The Company inherited work done on Nyngan from the previous property owner, and
applied that work to a quick flowsheet and capital estimate done for management by Roberts &
Schaefer of Salt Lake City, Utah;
• 2011 – The Company employed Hazen Research, Inc., of Golden, Colorado, USA (“Hazen”) to
test acid baking techniques and solvent extraction (“SX”) processes with Nyngan resource material.
The Company also employed SGS-Lakefield (Ontario) to test pressure acid leach techniques on
Nyngan resource, as a replacement for or an enhancement to acid bake techniques done earlier in
the year by Hazen;
• 2012 – The Company engaged SNC-Lavalin to do an economic study for management, utilizing an
acid bake flowsheet and SX work from the Hazen test program;
• 2014 – The Company published a preliminary economic assessment (“PEA”) entitled NI 43-101F1
Technical Report on the Feasibility of the Nyngan Scandium Project, authored by Larpro Pty Ltd,
utilizing both Hazen and SGS-Lakefield test work results;
• 2015 – The Company amended and refiled the 2014 PEA Report as the “Amended Technical Report
and Preliminary Economic Analysis on the Nyngan Scandium Project, NSW, Australia.”
• 2016 – The Company published an independently prepared definitive feasibility study (“DFS”) on
the Nyngan Scandium Project.
• 2023 – The Company commenced physical development of the Nyngan Scandium Project
following the results of the 2023 Nyngan drilling program which better defined the western
boundary of the existing resource.
Nyngan Definitive Feasibility Study
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On April 18, 2016, the Company announced the results of an independent definitive feasibility study on the
Nyngan Scandium Project. The technical report on the feasibility study entitled “Feasibility Study – Nyngan
Scandium Project, Bogan Shire, NSW, Australia” is dated May 4, 2016, and was independently compiled
pursuant to the requirements of NI 43-101 (the “Feasibility Study” or “DFS”).
Engineering, Procurement and Construction Management Contract
On May 30, 2017, the Company announced that its subsidiary EMC Metals Australia Pty. Ltd. signed an
Engineering, Procurement and Construction Management ("EPCM") contract with Lycopodium Minerals
Pty Ltd ("Lycopodium"), to build the Nyngan Scandium Project in New South Wales, Australia. The EPCM
contract also provides for start-up and commissioning services. As it has been more than six years since
initial signing, a new contract with similar provisions will be required.
The EPCM contract appoints Lycopodium (Brisbane, QLD, Australia) to manage all aspects of project
construction. Lycopodium is the principal engineering firm involved with the DFS. Lycopodium's
continued involvement in project construction and commissioning ensures valuable technical and
management continuity for the project during the construction and start-up of the project.
On October 19, 2017, we announced that Lycopodium has been instructed to initiate critical path
engineering for the Nyngan Scandium Project. Lycopodium commenced work on select critical path
components for the project, including design and specification engineering on the high-pressure autoclave
unit, associated flash and splash vessels and several specialized high-pressure input pumps. The engineering
work was completed in 2018 and will enable final supplier selection, firm component pricing and delivery
dates for these key process components.
Environmental Permitting/Development Consent/Mining Lease
On May 2, 2016, the Company announced the filing of an Environmental Impact Statement (“EIS”) with
the New South Wales, Australia, Department of Planning and Environment, (the “Department”) in support
of the planned development of the Nyngan Scandium Project. The EIS was prepared by R.W. Corkery &
Co. Pty. Limited, on behalf of the Company’s subsidiary, EMC Metals Australia Pty. Ltd. (“EMC
Australia”), to support an application for Development Consent for the Nyngan Scandium Project. The EIS
is a complete document, including a Specialist Consultants Study Compendium, and was submitted to the
Department on April 29, 2016.
EIS Highlights:
• The EIS finds residual environmental impacts represent negligible risk.
• The proposed development design achieves sustainable environmental outcomes.
• The EIS finds net-positive social and economic outcomes for the community.
• Nine independent environmental consulting groups conducted analysis over five years, and
contributed report findings to the EIS.
• The Nyngan project development is estimated to contribute A$12.4M to the local and regional
economies, and A$39M to the State and Federal economies, annually.
• The EIS is fully aligned with the DFS and with a NSW Mining License Application for the Nyngan
project.
Conclusion statement in the EIS: “In light of the conclusions included throughout this Environmental
Impact Statement, it is assessed that the Proposal could be constructed and operated in a manner that would
satisfy all relevant statutory goals and criteria, environmental objectives and reasonable community
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expectations.”
EIS Discussion
The EIS is the foundation document submitted by a developer intending to build a mine facility in Australia.
The Nyngan Scandium Project is considered a State Significant Project, in that capital cost exceeds
A$30million, which means State agencies are designated to manage the investigation and approval process
for granting a Development Consent from the Minister of Planning and Environment. This Department will
manage the review of the Proposal through a number of State and local governmental agencies.
The EIS is a self-contained set of documents used to seek a Development Consent. It is however, supported
in many ways by the recently completed DFS.
On November 10, 2016, the Company announced that the Development Consent had been granted. This
Development Consent represents an approval to develop the Nyngan Scandium Project and is based on the
EIS. The Development Consent follows an in-depth review of the EIS, the project plan, community impact
studies, public EIS exhibition and commentary, and economic viability, and involved more than 12
specialized governmental agencies and groups.
Mining Lease
During July 2019, EMC Australia received notice of approval for its mining lease (ML) application. The
ML (ML 1792) overlays select areas previously covered by exploration licenses and represents the final
major development approval required from the NSW Government to begin construction on the project. The
ML 1792 grant is issued for a period of 21 years and is based on the development plans and intent submitted
in the ML application. The ML can be modified by NSW regulatory agencies, as requested by EMC
Australia over time, to reflect changing operating conditions.
In addition to these two key governmental approvals, other required licenses and permits must be acquired
but are considered routine and require only compliance with fixed standards and objective measurements.
These remaining approvals include submittal of numerous plans and reports supporting compliance with
Development Consent and Mining Lease. In addition, the following water, roads, dam and electrical access
reviews and arrangements must be finalized:
• Water Supply Works and Use Approval and Water Access License,
• State and local approval for construction of the intersection of the Site Access Road and Gilgai
Road,
• An approval from the NSW Dams Safety Committee for the design and construction of the Residue
Storage Facility, and
• A high voltage connection agreement with Essential Energy.
The 2019 ML 1792 grant covers 810 acres (370 hectares) of surface area fully owned by the Company, an
area adequate to construct and operate a scandium mine of a scale outlined in the definitive Feasibility
Study. The Company had originally filed a mining lease application (MLA 531) covering an area of 874
hectares, which was granted in 2017 as a mining lease (ML 1763), and later ruled invalid. At that time, it
was unknown, to both the Department and the Company, that a local landowner had filed a prior, timely
and valid objection to the granting of that mining lease. The reduction in area between the initial 2017 ML
1763 and the replacement 2019 ML 1792 represented acreage protested in an “Agricultural Land” objection
lodged by a local landowner. The landowner holds freehold surface ownership over a portion of the original
grant that was previously covered by the 2017 ML 1763.
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On September 10, 2020, the Company announced receipt of a final determination letter from the Deputy
Secretary, Department of Regional NSW, Division of Mining, Exploration and Geoscience resolving the
outstanding objection filed by the landowner in 2016.
Written advice from the Department to the Company makes clear that all required independent investigative
processes, and all affected party comment periods, are now completed, and the Department’s decision is
final. There are further state courts of appeal available to the landowner, but the facts supporting this final
decision are confirmed by the NSW Department of Primary Industry and follow governing law.
This Final Determination from the NSW Government will again allow all measured and indicated resource
included in the Nyngan Scandium Project DFS to be reinstated in a new mining lease grant, for which the
Company has filed an application and which remains pending with the NSW Government.
Honeybugle Scandium Property (NSW, Australia)
On April 2, 2014, the Company announced that it had secured a 100% interest in an exploration license (EL
7977) covering 34.7 square kilometers in New South Wales, Australia. The license area we call the
‘Honeybugle Scandium Property’ is located approximately 24 kilometers west-southwest from the
Company’s Nyngan Scandium Project and approximately 36 kilometers southwest from the town of
Nyngan, NSW. The application to renew the exploration license for a further six years was approved in
November 2022.
Exploration rights for the Honeybugle Scandium Property include certain minimum expenditure
requirements. The Company intends to fulfill those minimum expenditure requirements.
The location of the Honeybugle Scandium property is provided below.
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Figure 3. Location of Honeybugle Scandium property
Honeybugle Drill Results
The Honeybugle drill program was completed in the first quarter of 2023. The drill program found
Scandium enriched laterite formation defined at Woodlong prospect within the Honeybugle Exploration
Licence 7977 area, where 32 vertical air core holes were drilled during first quarter 2023 in an
approximately 300m x 400m area.
The laterite mineralization, consisting of both hematite and limonite, lies less than 2 meters below the
surface. The laterite zone appears to thicken to both the west and south. Additional metallurgical testing is
required on the saprolite mineralization to determine suitability for potential economic extraction.
Downstream Scandium Products
In February 2011, we announced results of a series of laboratory-scale tests investigating the production of
aluminum-scandium master alloys directly from aluminum oxide and scandium oxide feed materials. The
overall objective of this research was to demonstrate and commercialize the production of aluminum-
scandium master alloy using impure scandium oxide as the scandium source, potentially significantly
improving the economics of aluminum-scandium master alloy production. In 2014, the Company
announced it applied for a US patent on master alloy production, which is still in the application phase.
During the 2015-2017 timeframe, we continued our own internal laboratory-scale investigations into the
production of aluminum-scandium master alloys, furthering our understanding of commercial processes
and achievable recoveries. We advanced our abilities to make a standard-grade 2% scandium master alloy
product typical of commercially available products offered today.
On March 2, 2017, we announced the signing of a Memorandum of Understanding ("MOU") with Weston
Aluminium Pty Ltd. ("Weston") of Chatswood, NSW, Australia. The MOU defines a cooperative
commercial alliance to jointly develop the capability to manufacture aluminum-scandium master alloy. The
intended outcome of this alliance will be to develop the capability to offer Nyngan Scandium Project
aluminum alloy customers scandium in form of Al-Sc master alloy, should customers prefer that product
form.
The MOU outlines steps to jointly establish the manufacturing parameters, metallurgical processes, and
capital requirements to convert Nyngan Scandium Project scandium product into Master Alloy, at Weston's
existing production site in NSW. The MOU does not include a binding contract with commercial terms at
this stage, although the intent is to pursue the necessary technical elements to arrive at a commercial contract
for conversion of scandium oxide to master alloy, and to do so prior to first mine production from the
Nyngan Scandium Project.
On March 5, 2018, the Company announced that it had initiated a small-scale pilot program (4kg scale) at
the Alcereco Inc. metallurgical research facilities in Kingston, Ontario, to confirm and refine previous lab-
scale work on the manufacture of aluminum-scandium 2% master alloy (MA). The program advanced the
process understanding for commercial scale upgrade of Nyngan scandium oxide product to master alloy
product.
The 2018 pilot program consisted of five separate trials on two MA product types, production of MA in
various forms, and dross analysis to ascertain scandium recoveries to product. The mass of master alloy
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and product variants produced in the program totaled approximately 20kg and was completed in December
of 2018. The results of the program included the successful production of 2% grade MA, with recoveries
of scandium to product of 85%.
A second phase of the small-scale pilot program was initiated in the first half of 2019, again at 4kg scale,
building on the work done in phase I. The results of this second program included successful production of
2% grade MA, with improvements in form of rapid kinetics, and recoveries of scandium to product of
+90%.
On March 5, 2018, the Company also announced that it filed for patent protection on certain process
refinements for master alloy manufacture that it believes are novel methods, and also on certain product
variants that it believes represent novel forms of introducing scandium more directly into aluminum alloys.
Master Alloy Capability Demonstrated
On February 24, 2020, the Company announced the completion of a three year, three stage program to
demonstrate the capability to manufacture aluminum-scandium master alloy (Al-Sc2%), from scandium
oxide, using a patent pending melt process involving aluminothermic reactions.
This master alloy capability will allow the Company to offer scandium product from the Nyngan Scandium
Project in a form that is used directly by aluminum alloy manufacturers globally, either major integrated
manufacturers or smaller wrought or casting alloy consumers.
Research Highlights:
• Program achieved full 2% target product quality requirement,
• Sc recoveries from oxide exceeded target, demonstrated in final tests,
• The microstructure and metal quality meet major alloy producers’ specifications,
• Rapid kinetics achieved, important for commercial viability,
•
• Successful program testing forms a basis for a larger scale demonstration facility, supporting large
Individual testing batches done at 4kg scale, and
scale samples required for industrial aluminum alloy trials.
Focus on Aluminum Alloy Applications for Scandium Products
The Company plans to obtain sales agreements for scandium products produced from our Nyngan
Scandium Project. Our focus is on the use of scandium as an alloying ingredient in aluminum-based
products. The specific scandium product forms we intend to sell from the Nyngan project include both
scandium oxide (Sc2O3) and aluminum-scandium master alloys (Al-Sc 2%).
Scandium as an alloying agent in aluminum allows for aluminum metal products that are much stronger,
more easily weldable and exhibit improved performance at higher temperatures than current aluminum-
based materials. This also means lighter structures, lower manufacturing costs and improved performance
in areas that aluminum alloys do not currently compete.
Use Of Scandium in Lithium-Ion Batteries
On September 24, 2020, the Company announced the filing of a provisional patent application with the US
Patent Office seeking patent rights on various applications of scandium in lithium-ion batteries. The patent
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application covers a number of scandium enhancements, including doping potential for both anodes and
cathodes, and for solid electrolytes.
Patent Application Highlights:
• US Patent Application filed for use of scandium in lithium-ion battery applications.
• Scandium doping applications are explained for anodes, cathodes and electrolytes.
• Scandium offers conductivity advantages as a dopant, over other options, and
• Scandium in other aluminum components offers numerous property improvements, including
conductivity, strength and corrosion resistance.
Rechargeable lithium-ion batteries (LIBs) are a staple of everyday life. The search for improved
performance through design and materials advances is intense today. Considerable effort is being expended
in developing next-generation materials for LIBs that will make batteries safer, lighter, more durable, faster
to charge, more powerful, and more cost-effective. A sampling of some these efforts are as follows:
• Minimizing or removing cobalt from cathode materials, based on cost, supply and geographic
•
sourcing issues.
Improving the durability of liquid electrolytes with dopants, or substitution with safer and higher
performing liquid or solid electrolyte systems.
• Designing for higher voltage potential by utilizing different anode or cathode materials.
• Determining combinations of metals that can better withstand harsh internal conditions.
• Scandium, along with other specialty metals, has a clear role to play in each of these areas.
One particularly promising area for scandium contributions is in a lithium nickel manganese oxide (LNMO)
battery. The cathode in this design substitutes manganese for cobalt and supports a higher nickel content as
well. The substitution then delivers higher working potentials (voltage), higher energy densities, and faster
charge/discharge rates, all of which offer the promise of improved battery performance.
Delivering on that promise requires a number of improvements, including employing a dopant for
stabilization of the manganese in certain cathode compositions, potential stabilization of lithium titanate
(LTO) anode materials as well, and use of dopants to improve the conductivity of both these anode and
cathode materials. Conventional liquid electrolytes may see improved function and longevity with the
improved cathode and anode conductivity. Scandium represents a suitable and effective dopant in each of
these applications.
Solid state electrolytes (SSEs) represent another potential break-through improvement in LIBs. They will
handle higher voltages, higher temperatures, greater power densities, are potentially easier to package, and
are considered safer in use. Scandium represents a suitable and effective dopant in these applications,
analogous to the use of scandium to stabilize solid zirconia electrolytes in solid oxide fuel cells. Recently
technical papers (available upon request) covering the use of Lithium Super Ion Conductors (LiSICON) for
SSEs have indicated that primary compounds containing scandium, such as Li3Sc2(PO4)3, LiScP2O7 and
Li3Sc(BO3)2, LiScO2 as well as certain doped compounds
such as Li1.33ScSi0.33P1.67O7,
Li3.375Mg0.375Sc0.625(BO3)2, Li1.5Al0.33Sc0.17Ge1.5(PO4)3, etc. can provide desirable crystal structural
frameworks for solid state electrolytes. Non-oxide LiSICON fast conductors have also been identified
recently, such as some lithium cryolite types: Li3ScCl6, as well as its fluoride counterpart Li3ScF6.
Lithium-ion batteries employ aluminum in a number of areas, specifically in cathode structure, current
connectors, and in general battery structure. Aluminum-scandium alloys represent an enhanced aluminum
alloy option, based on their combination of conductivity and strength.
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The intent of this SCY patent filing was to advise the battery industry that scandium is a prospective dopant
choice for enhanced performance of LIBs, both under existing design parameters and in particular for
certain next-gen lithium-ion batteries. We want to ensure that battery research and design groups consider
scandium additions, amongst their various materials choices, as they race to build a better lithium-ion
battery.
Qualified Person and Quality Assurance/Quality Control
John Thompson, B.E. (Mining); Vice President - Development at SCY is a qualified person as defined in
NI 43-101 and has reviewed the technical information on this property. The drilling, sampling, packaging
and transport of the 2023 drill samples was carried out to industry standards for QA/QC. SCY employed
an independent local geology consulting and drill supervisory team, Rangott Mineral Exploration Pty. Ltd.,
(RME) of Orange, NSW, Australia, to manage the drill work on-site. Bulk samples of drill returns were
collected at one metre intervals from a cyclone mounted on the drilling rig, and a separate three-tier riffle
splitter was used on site to obtain 2.0-4.5kg composite samples collected over 3 metre intervals, for assay.
Individual sample identifiers were cross-checked during the process. The assay samples were placed in
sealed polyweave bags which remained in RME’s possession until the completion of the drilling program,
at which time they were transported to RME’s office in Orange. There, the sequence of sample numbers
was validated, and the assay samples were immediately submitted to Australian Laboratory Services’
(ALS’) laboratory in Orange. The remnant bulk samples, which were collected in sealed polythene bags,
were transported by RME to a local storage unit at Orange, for long-term storage. ALS/Orange dried and
weighed the samples and pulverized the entire sample to 85% passing 75 microns or better (technique PUL-
21). These 50g sample bags of pulps were then sent to the ALS laboratory at Stafford in Brisbane,
Queensland for analysis. ALS/Brisbane analyzed the pulps for scandium, nickel, cobalt, chromium, iron
and magnesium, using Inductively Coupled Plasma Atomic Emission Spectroscopy (ICP-AES) after a four
acid (total) digestion (technique ME-ICP61). The lower detection limit for scandium using this technique
is 1ppm. For their internal quality control, ALS/Brisbane added 4 standard samples (for 20 repeat analyses),
10 blank samples and 16 duplicate samples to the batch. Please see news release see news release dated
May 7, 2014, and available on www.sedar.com for further information on the Honeybugle drill results.
Patent Program Summary- Applications and Grants
Patent Filings - Summary
The Company is in the process of establishing a significant portfolio of intellectual property through the
filing of scandium related patents both in the US and abroad.
On 10/12/2021 the company was granted a patent for the recovery of scandium from nickel laterite ores.
To date, the following nine US patents have been granted to the Company:
11,142,809
10,988,830
10,988,828
10,450,634
10,378,085
10,260,127
9,982,326
Systems and Processes for Recovering Scandium Values from Laterite Ores
Scandium Master Alloy Production
Extraction of Scandium Values from Copper Leach Solutions
Scandium-Containing Master Alloys and Method for Making The Same
Recovery Of Scandium Values Through Selective Precipitation of Hematite and
Basic Iron Sulfates from Acid Leachates
Method For Recovering Scandium Values from Leach Solutions
Solvent Extraction of Scandium from Leach Solutions
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9,982,325
8,372,367
Systems And Methodologies for Direct Acid Leaching of Scandium-Bearing
Ores
System and Method for Recovering Boron Values from Plant Tailings
Below is a list of thirteen US patents that have been filed, but have not been granted yet:
US20210371294-A1
US202163038873
US20210347651
US20200001407
US20210172041
US20190218645
US20120305452
US20110298270
US2012005585l
US20120204680
US20120207656
Provisional (2)
Process for the Preparation of High Purity Alumina*
Recovery of Critical Metals from SX-EW Copper Raffinate and Other Solutions
Derived from Leaching Ores with Sulfuric Acid
Counter Current Process for Recovering High Purity Copper Sulfate Values
from Low Grade Ores
Control Of Recrystallization In Cold-Rolled AlMn(Mg)ScZr Sheets For
Brazing Applications
Byproduct Scandium Recovery from Low Grade Primary Metal Oxide Ores
Direct Scandium Alloying
Dry, Stackable Tailings and Methods for Producing the Same
In Situ Ore Leaching Using Freeze Barriers
Low Carbon Dioxide Footprint for Coal Liquefaction
System and Method for Recovery of Nickel Values from Nickel-Containing
Ores
System and Method for Recovery of Scandium Values from Scandium-
Containing Ores
Titles not yet publicly disclosed
*NOTE: This Final Patent Application was published by the US Patent office on December 2, 2021 (A1)
Patent Applications Discussion
• These patents and patent applications cover novel, unique flowsheet designs, applicable to both
scandium extraction and other metals extraction.
• The patented designs on scandium are largely supported by test work done with Nyngan Scandium
Project resource material and known design parameters.
• The scandium patents cover HPAL system material flows, solvent extraction (SX), ion exchange
systems (“IX”), atmospheric tank and heap leaching systems and techniques, and processes for
directly making select master alloys containing scandium; and
• A number of the scandium-focussed designs are incorporated as part of the DFS.
• Recovery of by-product scandium from certain other mineral resources is also covered.
• Recovery of base metals, such as copper, cobalt, nickel, manganese and aluminum from process
solutions or waste products is also covered.
• Use of scandium in lithium-ion batteries is addressed.
These patent applications, filed with the US Patent Office, protect the Company’s position and rights to the
intellectual property (IP) contained and identified in the applications as of the date filed, within the
worldwide jurisdiction limits of the US patent system. Review of patent applications by the US Patent
Office takes time, but the initial dates of filing these patents define the basis of IP ownership claims, as is
generally afforded U.S. patentholders.
The Company intends to utilize the IP contained in these process patents in the development of process
flowsheets for recovery of scandium from its Nyngan Scandium Project, as well as its Honeybugle project
{00041444:1}
and future by-product opportunities from leach solutions and/or waste products. The Company believes that
patent protection of these specific, novel process designs will be granted.
Many of the basic design elements contemplated in the Nyngan Scandium Project flowsheet are commonly
applied to other specialty metals, particularly nickel. However, the application of these basic design
elements has not been commonly applied to scandium extraction from laterite resources, and there are
enough intended and required operational differences in the application to permit the Company to patent-
protect IP on those differences.
Our history of work on solution separation technologies using ion exchange and/or solvent extraction has
widened our opportunity to pursue recovery of select elements of a growing list of critical metals, as defined
by governments, concerned customers and industry groups, specifically prioritising lithium-ion battery
metals.
These patent claims are the result of ten years of metallurgical test work with independent resource
laboratories and specific design work by Willem Duyvesteyn, the Company’s former Chief Technology
Officer. This work is ongoing. Patent protection on flowsheet intellectual property will serve to limit or
prevent the unauthorized use of that IP by others without the Company’s consent. We believe these filings
are an important action to protect the ownership of a Company asset, on behalf of all SCY shareholders.
ITEM 3. LEGAL PROCEEDINGS
We are not a party to any pending legal proceedings and, to the best of our knowledge, none of our
properties or assets are the subject of any pending legal proceedings.
ITEM 4. MINE SAFETY DISCLOSURES
The Company has no active mining operations or dormant mining assets currently and has no outstanding
mine safety violations or other regulatory safety matters to report.
PART II
ITEM 5. MARKET FOR REGISTRANTS’ COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Price Range of Common Shares
The principal market on which our common shares are traded is the Toronto Stock Exchange. Our common
shares commenced trading on the Toronto Stock Exchange on April 24, 2008, under the symbol “GP.”
Effective March 11, 2009, the common shares were listed and posted for trading on the Toronto Stock
Exchange under the symbol “EMC.” Effective November 28, 2014, the common shares were listed and
posted for trading on the Toronto Stock Exchange under the symbol “SCY.” The following table shows the
high and low trading prices of our common shares on the Toronto Stock Exchange for the periods indicated.
{00041444:1}
Year
Fiscal Year ended December 31, 2023
First quarter
Second quarter
Third quarter
Fourth quarter
Fiscal Year ended December 31, 2022
First quarter
Second quarter
Third quarter
Fourth quarter
High
(C$)
0.080
0.060
0.055
0.035
0.160
0.140
0.120
0.095
Low
(C$)
0.040
0.040
0.030
0.020
0.130
0.085
0.060
0.060
Exchange Rates
We maintain our books of account in United States dollars and references to dollar amounts herein are to
the lawful currency of the United States except that we are traded on the Toronto Stock Exchange and,
accordingly, stock price quotes and sales of stock are conducted in Canadian dollars (C$). The following
table sets forth, for the periods indicated, certain exchange rates based on the noon rate provided by the
Bank of Canada. Such rates are the number of Canadian dollars per one (1) U.S. dollar (US$). The high and
low exchange rates for each month during the previous six months were as follows:
February 2024
January 2024
December 2023
November 2023
October 2023
September 2023
High
1.3574
1.3512
1.3582
1.3873
1.3873
1.3661
Low
1.3404
1.3446
1.3200
1.3573
1.3577
1.3422
The following table sets out the exchange rate (price of one U.S. dollar in Canadian dollars) information as
at each of the years ended December 31, 2023, and 2022.
Rate at end of Period
Low
High
Year Ended December 31
(Canadian $ per U.S. $)
2022
2023
1.3247
1.3544
1.3128
1.2470
1.3856
1.3875
As of March 26, 2024, there were 104 registered holders of record of the Company’s common shares and
an undetermined number of beneficial holders.
Dividends
We have not paid any cash dividends on our common shares since our inception and do not anticipate
paying any cash dividends in the foreseeable future. We plan to retain our earnings, if any, to provide funds
for the expansion of our business.
{00041444:1}
Securities Authorized for Issuance under Compensation Plans
The following table sets forth information as of December 31, 2023, respecting the compensation plans
under which shares of the Company’s common stock are authorized to be issued.
Number of securities
to be issued upon
exercise of
outstanding options,
warrants and rights
(a)
Weighted-average
exercise price of
outstanding options,
warrants and rights
(b)
40,015,000
C$0.010
Number of securities
remaining available
for future issuance
under equity
compensation plans
(excluding securities
reflected in column
(a))
(c)
19,714,122
37,803,218
C$0.1075
Nil
77,818,218
C$0.0980
19,714,122
Plan Category
Equity compensation
plans approved by
security holders
Equity compensation
plans not approved by
security holders
Total
Purchases of Equity Securities by the Company and Affiliated Purchasers
Neither the Company nor an affiliated purchaser of the Company purchased common shares of the Company
in the year ended December 31, 2023.
ITEM 6. SELECTED FINANCIAL DATA
Not applicable.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
RESULTS OF OPERATIONS
Overview
Scandium International is a specialty metals company focused on the evaluation and potential development
of projects into producing assets. The Company pursues project opportunities from both known geologic
resources and existing mine process solutions when it identifies further recovery potential.
The Company is an exploration stage company and anticipates incurring significant additional expenditures
prior to production at all its properties. The Company was incorporated under the laws of the Province of
British Columbia, Canada in 2006. The Company currently trades on the Toronto Stock Exchange under
the symbol “SCY.”
These consolidated financial statements have been prepared on a going concern basis that contemplates the
realization of assets and discharge of liabilities at their carrying values in the normal course of business for
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the foreseeable future. These financial statements do not reflect any adjustments that may be necessary if
the Company is unable to continue as a going concern.
The Company currently earns no operating revenues and will require additional capital to advance the
Nyngan property. The Company’s ability to continue as a going concern is uncertain and is dependent upon
the generation of profits from mineral properties, obtaining additional financing and maintaining continued
support from its shareholders and creditors. These are material uncertainties that raise substantial doubt
about the Company’s ability to continue as a going concern. If additional financial support is not received,
or operating profits are not generated, the carrying values of the Company’s assets may be adversely
affected.
The outbreak of COVID-19 and political upheavals in various countries have caused significant volatility
in commodity prices. While these effects are expected to be temporary, the duration of the business
disruptions internationally and related financial impact cannot be reasonably estimated at this time.
RESULTS FOR THE YEAR ENDED DECEMBER 31, 2023
Liquidity and Capital Resources
On December 31, 2023, we had working capital of $712,908 including cash of $1,021,956 and current
liabilities of $349,259 as compared to working capital of $378,527 including cash of $1,852,710 at
December 31, 2022.
On December 31, 2023, we had a total of 40,015,000 (2022 – 34,665,000) stock options exercisable between
C$0.035 and C$0.180 (2022 – between C$0.065 and C$0.225) which have the potential upon exercise to
generate a total of C$3,833,750 (2022 – C$4,753,500) in cash over the next four and a half years. On
December 31, 2023, we had a total of 37,803,218 (2022 – 37,803,218) warrants exercisable at C$0.1075
which have the potential upon exercise to generate a total of C$4,063,846. There is no assurance that these
securities will be exercised.
Our continued development is contingent upon our ability to raise sufficient financing both in the short and
long term. There are no guarantees that additional sources of funding will be available to us; however,
management is committed to pursuing all possible sources of financing to execute our business plan.
Results of Operations
Quarter ended December 31, 2023
The net loss for the quarter decreased by $362,143 to $133,772 from a profit of $228,371 in the quarter
ended December 31, 2022. Details of the individual items contributing to the decreased loss are as follows:
Q4 2023 vs. Q4 2022 - Variance Analysis (US$)
Item
Salaries and benefits
including stock
based compensation
Variance
Favourable /
(Unfavourable)
($178,023)
Explanation
This unfavorable variance when comparing Q4 2023 to Q4
2022 is a result of options being issued in Q4 2023 whereas
there were no options issued in Q4 2022.
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Q4 2023 vs. Q4 2022 - Variance Analysis (US$)
Item
General and
administrative
Variance
Favourable /
(Unfavourable)
($26,863)
Exploration
($24,858)
Explanation
In Q4 of 2022 there were very little expenditures. The current
quarter costs of $16,997 are much more indicative or normal
activity levels.
In the current quarter the Company was still incurring costs
for the winding up of the exploration programs carried out in
Q2 and Q3 of 2023. There was no major exploration carried
out in Q4 of 2022.
Professional fees
($10,386)
The slightly higher fees in the quarter relate to activities
pertaining to share encumbrances being dealt with.
Gain on derivative
liability
($157,049)
Insurance
Travel
$417
$747
Warrants issued in Q2 2022 are in Canadian funds. As the
exchange rate with the Canadian dollar fluctuates, a gain or
loss on this is recorded in the financial statements. Also, the
value of the warrants is recalculated based on Black-Scholes
calculation at the end of the year. Quarter over quarter the gain
on the derivative liability is almost the same. This is a non-
cash item.
New insurance policies were entered into in Q4 2023.
Premiums have increased resulting in this minor favorable
variance.
There were no travel expenditures incurred in Q4 of 2023
versus Q4 of 2022 when very light travel took place.
Interest income
$9,771
The company has invested funds received from the financing
received in 2022 resulting in this favorable variance.
Foreign exchange
loss
$24,101
In Q4 funds held in foreign currencies increased against the
US dollar resulting in this positive variance when compared
to the comparable period in 2022.
Results of Operations for the Year ended December 31, 2023
The net profit for the year decreased by $803,392 to $47,204 from a profit of $850,596 in the prior year,
Details of the individual items contributing to the decreased net loss are as follows:
{00041444:1}
2023 vs. 2022 - Variance Analysis (US$)
Item
Accrual reversal
Variance
Favourable /
(Unfavourable)
($1,032,044)
Exploration
($245,092)
Salaries benefits
and stock-based
compensation
Foreign exchange
gain
Travel and
entertainment
($31,836)
($17,086)
($2,990)
Insurance
($134)
Explanation
In the prior year, the Company reversed accrued liabilities for
certain staff who are no longer with the Company. No such
item was incurred in 2023.
In Q2 2023, the Company carried out drilling activities on its
Australian properties while in 2022, no exploration activities
were conducted. To further increase this unfavorable variance,
the Company received a refund in 2022 from the Australian
government related to over payment of mining license costs.
The stock-based compensation value for 2023 is higher due to
the large number of options issued in 2023 when compared to
2022 resulting in this unfavorable variance.
The US dollar strengthened in 2023 against both the Australian
and Canadian dollar.
With the start of the drilling program at Honeybugle,
management visited the property and legal counsel in
Australia. No such expenditures were incurred in 2022.
Slightly higher premiums for D&O insurance and general
liability insurance resulted in this minor variance when
comparing the two years.
Amortization
$2,932
All fixed assets were fully depreciated in Q2 2022, resulting in
no expense associated with this item in 2023.
Professional fees
$8,636
In Q2 2022 advice from our legal firm were required as the
Company underwent management changes. No such activities
took place in 2023.
Consulting
$18,363
The resignation of a consultant in 2022 led to this favorable
variance in the current year.
Interest income
$39,851
In 2023,
investments. No similar opportunity existed in 2022.
the Company purchased short
term secure
General and
administrative
$59,901
With the closing of the Sparks, Nevada office and reduced
staffing, a favorable variance was realized when compared to
2022 when there was much more activity and staffing.
{00041444:1}
2023 vs. 2022 - Variance Analysis (US$)
Item
Gain on derivative
liability
Variance
Favourable /
(Unfavourable)
$396,107
Explanation
Warrants issued in Q2 2022 are in Canadian funds. As the
exchange rate with the Canadian dollar fluctuates, a gain or
loss on this is recorded in the financial statements. Also, the
value of the warrants is recalculated based on Black-Scholes
calculation at the end of the quarter. Since the warrants were
issued, a gain has been calculated. This is a non-cash item.
Cash flow discussion for the year ended December 31, 2023, compared to December 31, 2022
The cash outflow from operating activities decreased by $116,961 to $830,754 (2022 – $947,715) due
mainly to payment of accrued salaries in 2022.
Cash inflows from financing activities of $Nil when compared to the year ended December 30, 2022, in
which private placement and options being exercised brought in $2,706,531.
Summary of quarterly results (US$)
Q4
-
2023
Q3
-
Q2
-
Q1
-
Q4
-
2022
Q3
-
Q2
-
Q1
-
(133,732)
74,732
(129,756)
236,000
228,371
70,701
28,577
522,946
(0.00)
(0.00)
(0.00)
(0.00)
(0.00)
(0.00)
(0.00)
(0.00)
Net Sales
Net Income
(Loss)
Basic and
diluted
Net Income
(Loss) per
share
Financial Position
Cash
Year-end cash decreased by $830,754 to $1,021,956 (2022 - $1,852,710) due mainly to a reduction in
accounts payable and exploration activities carried out in 2023.
Prepaid expenses and receivables
Prepaid expenses and receivables have increased by $6,670 to $40,211 (2022 - $33,541) due to increased
activity levels in 2022.
Reclamation bond
A reclamation bond of €10,000 ($11,037) was purchased for the Kiviniemi property in 2018.
{00041444:1}
Mineral interests
Mineral interests remained at $704,053 at December 31, 2023 (2022 - $704,053).
Accounts Payable, Accounts payable with related parties, Accrued Liabilities and Derivative liability -
warrants.
Accounts payable, accounts payable with related parties, accrued liabilities and Derivative liability –
warrants have decreased by $1,158,465 to $349,259 at December 31, 2023 (2022 – $1,507,724) due to
revaluation of warrant derivative liability and payment of accrued salaries.
Capital Stock
Capital stock did not change in 2023 - $111,144,603 (2022 - $111,144,603).
Additional paid-in capital increased by $287,515 to $7,306,631 (2022 - $7,019,116) as a result of stock
option expensing.
Treasury shares remained at $1,264,194 through the 2023 and 2022 fiscal periods.
Off-balance sheet arrangements
At December 31, 2023, we had no material off-balance sheet arrangements such as guarantee contracts,
contingent interest in assets transferred to an entity, derivative instruments obligations or any obligations
that trigger financing, liquidity, market or credit risk to us.
Transactions with related parties
During the year ended December 31, 2023, the Company expensed $262,294 for stock-based compensation
for stock options issued to Company directors. During the year ended December 31, 2022, the Company
expensed $177,745 for stock options issued to Company directors.
During the year ended December 31, 2023, the Company expensed a consulting fee of $Nil (2022 - $17,000)
to one of its directors.
As at December 31, 2023, the Company owed $5,104 (2022 - $185,576) to an officer of the Company.
During the year ended December 31, 2023, the Company reversed $Nil (2022 - $669,733) of accruals to
related parties, pursuant to settlement agreements.
Additional Information and Accounting Pronouncements
Outstanding share data
At March 26, 2024 we had 355,860,813 issued and outstanding common shares and 40,015,000 outstanding
stock options at a weighted average exercise price of C$0.10. Also, there were 37,803,218 warrants
outstanding at C$10.75 at March 26, 2024.
Critical Accounting Estimates
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The preparation of financial statements in conformity with generally accepted accounting policies requires
our management to make estimates and assumptions that affect the reported amounts of assets and liabilities
at the date of the financial statements and the reported amounts of revenues and expenses during the
reporting period. These estimates are based on past experience, industry trends and known commitments
and events. By their nature, these estimates are subject to measurement uncertainty and the effects on the
financial statements of changes in such estimates in future periods could be significant. Actual results will
likely differ from those estimates.
Stock-based compensation
We use the Black-Scholes option pricing model to calculate the fair value of stock options and
compensatory warrants granted. This model is subject to various assumptions. The assumptions we make
will likely change from time to time. At the time the fair value is determined, the methodology that we use
is based on historical information, as well as anticipated future events. The assumptions with the greatest
impact on fair value are those for estimated stock volatility and for the expected life of the instrument.
Deferred income taxes
We account for tax consequences of the differences in the carrying amounts of assets and liabilities and our
tax bases using tax rates expected to apply when these temporary differences are expected to be settled.
When the deferred realization of income tax assets does not meet the test of being more likely than not to
occur, a valuation allowance in the amount of the potential future benefit is taken and no future income tax
asset is recognized. We have taken a valuation allowance against all such potential tax assets.
Mineral properties and exploration and development costs
We capitalise the costs of acquiring mineral rights at the date of acquisition. After acquisition, various
factors can affect the recoverability of the capitalized costs. Our recoverability evaluation of our mineral
properties and equipment is based on market conditions for minerals, underlying mineral resources
associated with the assets and future costs that may be required for ultimate realization through mining
operations or by sale. We are in an industry that is exposed to a number of risks and uncertainties, including
exploration risk, development risk, commodity price risk, operating risk, ownership and political risk,
funding and currency risk, as well as environmental risk. Bearing these risks in mind, we have assumed
recent world commodity prices will be achievable. We have considered the mineral resource reports by
independent engineers on the Nyngan project in considering the recoverability of the carrying costs of the
mineral properties. All of these assumptions are potentially subject to change, out of our control, however
such changes are not determinable. Accordingly, there is always the potential for a material adjustment to
the value assigned to mineral properties and equipment.
Recent Accounting Pronouncements
Accounting Standards Update 2023-07 – Segment Reporting (Topic 280). This update is to improve the
disclosures about a public entity’s reportable segments through enhanced disclosures about significant
segment expenses and is effective for fiscal years beginning after December 15, 2023, and interim periods
within fiscal years beginning after December 15, 2024. The Company is reviewing this standard but
anticipates little impact on its financial statements.
Accounting Standards Update 2023-09 – Income Taxes (Topic 740). This update is to enhance the
transparency and decision usefulness of income tax disclosures for fiscal years beginning after December
15, 2024. The Company is reviewing this standard to determine the impact on its financial statements.
{00041444:1}
Financial instruments and other risks
Our financial instruments consist of cash, receivables, accounts payable and accrued liabilities, accounts
payable with related parties, and promissory notes payable. It is management's opinion that we are not
exposed to significant interest, currency or credit risks arising from our financial instruments. The fair
values of these financial instruments approximate their carrying values unless otherwise noted. The
Company has its cash primarily in five commercial banks, one in Vancouver, British Columbia, Canada,
one in Hamilton, Ontario, Canada, one in Melbourne, Australia, one in Chicago, Illinois and one in Los
Angeles, California.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The Consolidated Financial Statements of the Company and the notes thereto are attached to this report
following the signature page and Certifications.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
For the fiscal years ended December 31, 2023, and 2022, we did not have any disagreement with our
accountants on any matter of accounting principles, practices, or financial statement disclosure.
ITEM 9A. CONTROLS AND PROCEDURES
Disclosure controls and procedures
The Company’s management, including our principal executive officer and our principal financial officer,
evaluated the effectiveness of disclosure controls and procedures (as defined in Exchange Act Rule 13a-
15(e)) as of the end of the period covered by this report. Based on that evaluation, the principal executive
officer and principal financial officer concluded that as of the end of the period covered by this report, the
Company has maintained effective disclosure controls and procedures in all material respects, including
those necessary to ensure that information required to be disclosed in reports filed or submitted with the
SEC (i) is recorded, processed, and reported within the time periods specified by the sec, and (ii) is
accumulated and communicated to management, including the principal executive officer and principal
financial officer, as appropriate to allow for timely decision regarding required disclosure.
Management’s report on internal control over financial reporting
The Company’s management is responsible for establishing and maintaining adequate internal control over
financial reporting (as defined in Rule 13a-15(f) or 15d-15(f) of the Exchange Act). Management assessed
the effectiveness of our internal control over financial reporting as of December 31, 2019, using criteria
established in Internal Control-Integrated Framework issued in 1992 by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Even an effective internal control system, no matter
how well designed, has inherent limitations, including the possibility of human error and circumvention or
overriding of controls and therefore can provide only reasonable assurance with respect to reliable financial
{00041444:1}
reporting. Furthermore, the effectiveness of an internal control system in future periods can change with
conditions.
A material weakness is a deficiency, or combination of deficiencies, in internal control over financial
reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual
or interim financial statements will not be prevented or detected on a timely basis.
The Company’s management has determined that the internal controls over financial reporting are effective
as of December 31, 2023.
Changes in Internal Control
There have been no changes in internal control over financial reporting that occurred during the last fiscal
quarter that have materially affected, or are reasonably likely to materially affect, internal control over
financial reporting.
ITEM 9B. OTHER INFORMATION
None.
PART III
Information with respect to Items 10 through 14 is set forth in the definitive Proxy Statement to be filed
with the Securities and Exchange Commission on or before April 30, 2024, and is incorporated herein by
reference. If the definitive Proxy Statement cannot be filed on or before April 30, 2024, the Company will
instead file an amendment to this Form 10-K disclosing the information with respect to Items 10 through
14.
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENTS SCHEDULES
Financial Statements
The following Consolidated Financial Statements are filed as part of this report.
Description
Financial statements for the years ended December 31, 2023, and 2022 and
audit reports thereon. (DAVIDSON & COMPANY LLP - PCAOB 731)
Page
F-1
Exhibits
The following table sets out the exhibits filed herewith or incorporated herein by reference.
Exhibit
3.1
Description
Certificate of Incorporation, Certificate of Name Change dated March 2009, Notice of
Articles dated March 2009(1)
{00041444:1}
3.2
10.1(3)
10.4(5)
21.1(6)
23.1(6)
31.1(6)
31.2(6)
32.1(6)
32.2(6)
Certificate of Name Change dated November 19, 2014 and Notice of Articles dated
November 19, 2014(2)
Corporate Articles(1)
Amendment to Corporate Articles dated November 10, 2014(2)
2015 Stock Option Plan
Share Exchange Agreement dated June 30, 2017
List of Subsidiaries
Consent of Davidson & Company LLP
Certification Pursuant to Rule 13a-14(a) or 15d-14(a) of the U.S. Securities Exchange
Act of 1934 of the Principal Executive Officer
Certification Pursuant to Rule 13a-14(a) or 15d-14(a) of the U.S. Securities Exchange
Act of 1934 of the Principal Financial Officer
Section 1350 Certification of the Principal Executive Officer and Principal Financial
Officer of the Principal Executive Officer
Section 1350 Certification of the Principal Executive Officer and Principal Financial
Officer of the Principal Financial Officer
(1) Previously filed as exhibits to the Form 10 filed May 24, 2011 and incorporated herein by reference.
(2) Previously filed as exhibits to the Form 10-K filed February 27, 2015 and incorporated herein by reference.
(3) Previously filed as Schedule “A” to the Form DEF 14A filed October 5, 2015 and incorporated herein by reference.
(4) Previously filed as an exhibit to the Form 10-K/A filed May 1, 2014 and incorporated herein by reference.
(5) Previously filed as an exhibit to the Form 8-K filed July 26, 2017 and incorporated herein by reference.
(6) Filed herewith.
{00041444:1}
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
SIGNATURES
SCANDIUM INTERNATIONAL MINING CORP.
By: /s/ Peter Evensen
Peter Evensen
President and Principal Executive Officer
Date: March 26, 2024
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/s/ Peter Evensen
Peter Evensen
/s/ William Harris
William Harris
President, Principal Executive Officer, and Director March 26, 2024
Chairman and Director
March 26, 2024
/s/ James Rothwell
James Rothwell
Director
March 26, 2024
/s/ R. Christian Evensen Director & Principal Financial Officer
R. Christian Evensen
March 26, 2024
{00041444:1}