Australian resources company MDF Global, who are aiming to become the largest pure-play exploration company on the planet in the next 5 years, have just landed one of the largest ever exploration agreements in history.

The Critical Metals Alliance (CMA) in Alaska gives them access to up to 10 million acres of highly prospective land to undertake exploration on +50 projects, for which they target commercialising 15+ new critical metals projects within 5 years.

This makes MDF one of the most ambitious exploration platforms in the world.

While these aspirations sound bold, the deal is yet another example of the rapid rise of MDF Global, led by industry legend John Main who was previously Rio Tinto’s former MD of America. Within just four years, his team, which is credited with over $100bn worth of discoveries, has assembled an impressive portfolio of potential tier-1 projects – such as Pyramid Copper with a contained metals value of $8.5bn+.

“I am proud of what we have achieved over the past four years with our new model for finding the critical metals the world desperately needs. The Critical Metals Alliance is our biggest success yet, but more importantly allows us to accelerate our growth on a much larger scale.” – John Main (Chairman, MDF Global)

Reach Markets will soon open an institutional capital raise for MDF Global and will allow wholesale investors an opportunity to invest. This is an opportunity to get exposure to one of the most ambitious mineral exploration projects on the planet, run by world-renowned geologists and backed by Australian billionaire families, click here to request the offer documents.

The global problem – we are running out of critical metals

MDF started in 2020 with a mission to solve the global issue of dwindling supply of critical minerals.

Using copper – the ‘electrification metal’ – as an example, new discoveries are simply not happening anymore. While we were discovering 12 major copper mines a year in the 1990s, this has decreased to just 1 per year recently – even though the copper price is now four times as high as back then.

This has several reasons, all of which should concern us.

The large mining companies have heavily reduced their exploration budgets as they are focused on existing production, while sourcing new projects simply by acquiring juniors. The smaller exploration companies, on the other hand, are failing at exploration too, but for different reasons. Being perceived as high-risk, they often struggle to attract financing for exploration activities.

Moreover, the human capital is running in short supply too: Over the past 8 years there has been a 40% decline in students completing geoscience degrees. A key factor identified was that young people see the mining industry as ‘dirty’ which is a sad irony, given the supply of critical metals is, well, critical for transitioning to green energy which will require huge amounts of these commodities.

Taking copper for an example again, annual demand is expected to jump from 25Mt in 2022 to 35Mt in 2030. To cover this, 15 major copper mines would need to be discovered per year in coming years – 15x the discovery rate of recent years.

The result annual deficit as much as 8.2Mt by 2030, worth over $100 billion, with undersupply slated to hit markets from next year which at some stage will need to be reflected in prices.

Source: MDF Global (August 2024) Presentation, sourced from Snowdon et al, 2021

Earlier this year investors got a taste of what a sudden and slight shortage can do to the copper price with its surge above US$11,000 in May, rallying 25% in just half a year. Some industry experts are forecasting volatility to get worse, like copper billionaire Robert Friedland who is predicting a “copper trainwreck” with price increases of up to 10x.

Click here to join a live investor briefing on Friday, 6 September 12pm (AEST) to hear directly from Managing Director Joseph Webb on how MDF Global is looking to capitalise on the shortage of critical metals such as copper.

MDF Global – a new model for exploration

Seeing this as a generational investment opportunity, MDF Global brought together one of the most successful teams of proven Tier 1 metals discovery geologists ever formed in a private company, who together are credited with discoveries worth over $100 billion in actual or planned production.

Having already built a portfolio of 10 projects and now targeting 50 over the next 5 years, the team considers MDF to be one of the most ambitious exploration platforms on the globe.

Their exploration model is very different from the existing, broken, model we discussed above. It is built on the principles that made Mr Main so successful while running exploration at RIO in the 90ies – a capital light approach, with portfolio sales financing the creation and development of new tier-1 projects in an ever growing portfolio.

The approach to exploration itself is highly systematic. First, they take a strategic focus around jurisdiction and commodity. Over the past years this has been mostly copper in Alaska which is not just a mineral rich mining friendly jurisdiction, but also moving into strategic focus for the US which is scrambling to build its own supply chains for critical minerals as geopolitical tensions are rising.

Once MDF has established a regional ‘hub’, they scan the region for 1000s of prospects, aided by their own big data/AI system called MineralEyes. They then narrow this down to a few projects to focus on and then set up a subsidiary for each project, seed it, peg the land and start exploration. Tier-1 potentials are taken further while opportunistic projects can be sold or listed to finance the next big find.

Source: MDF Global, MDF Global has developed a new model for minerals exploration

With only $7.3m ever invested in the business, MDF Global has already built an impressive portfolio of equity and/or royalty holdings across 10 projects, two of which they consider a potential tier-1 asset.

The first of the two is the Pyramid Copper Project a vast project with near term prospects of production. The deposit contains a large 153Mt resource with over $8.5 billion worth of contained copper, and with the strong prospect of expanding to 300-500Mt at a contained copper value of $16.65-$27.75 billion

Another potential tier-1 asset is Felix Gold. MDF founded the company and listed it on the ASX (ticker FXG). Over the past year, Felix has built a 831Koz inferred gold resource looking for a low capex commercial pathway, given its location next to a large Kinross mill that desperately needs ore. In addition, Felix recently made headlines as its share price doubled on the back of high grade assay for antimony – another critical mineral of strategic importance to the US.

MDF shareholders should be very happy with MDF’s progress. The company has already distributed around 80% worth of the capital that has gone into the business through distributions in portfolio companies, while building a valuable portfolio of assets.*

Reach Markets will soon open an opportunity for wholesale investors to get exposure to MDF’s portfolio of projects backed by Australian billionaire mining families. Click here to request the offer documents.

The Critical Metals Alliance deal – accelerating MDF’s their growth

The highlight, however, came last week when MDF announced it had closed one of the largest ever mineral exploration agreements in history.

Under a fully funded program for up to US$ 50m, the Critical Metals Alliance deal gives MDF access to up to 10 million acres of underexplored Alaskan land that has been out of reach for explorers for decades – notably in the US where the Inflation Reduction Act is injecting US$350 billion to shore up its critical metals supply chains.

As a part of the deal, MDF also gains access to swatches of historical data, worth tens of millions of dollars and priceless in the hands of their expert team, from mining companies that were exploring in the area half a century ago.

The deal is funded by strategic investors, including traditional landowner corporations and well-known Australian mining billionaires. MDF Global provides the expertise and their IP in return for 30-50% of the upside via carried interest, again proving their capital light model.

For the next 5 years, they are targeting to create 15 projects from this deal. If just one tier-1 project could be found, this could already be a major success for MDF shareholders.

Source: MDF Global, MDF has ambitious targets for the next 5 years

“CMA is far more than just further proof of concept for MDF. It accelerates our growth for the coming years, as we are targeting 15+ new projects to come out of this, 5 of which with tier-1 potential. In total, our 5-year goal is 50 new projects, which would make us one of the largest exploration platforms on the globe, if not the largest.” – Joseph Webb (Managing Director, MDF Global)

With the world on the cusp of its largest ever critical metals shortage, MDF’s timing could not be better.

Their ambitions sound extremely bold, but looking at the pedigree of the people involved and results so far, they believe they are certainly on a good track.

Reach Markets will soon open an opportunity for wholesale investors to invest in MDF at terms established prior to the close of the Critical Metals Alliance deal. Click here to request the offer documents.