Get the Latest Investment Ideas Delivered Straight to Your Inbox. Subscribe


First Nations Group Signs 'Unique' Partnership With Rare Earths Co.

View Important Disclosures for this Article
Share on Stocktwits


Defense Metals Corp. announced it has entered into a strategic equity partnership and co-design agreement with the McLeod Lake Indian Band (MLIB) for the company's Wicheeda rare earth elements (REE) project in British Columbia. Find out why the stock is rated "Outperform" by one analyst.

Defense Metals Corp. (DEFN:TSX.V; DFMTF:OTCQB; 35D:FSE) announced it has entered into a strategic equity partnership and co-design agreement with the McLeod Lake Indian Band (MLIB) for the company's Wicheeda rare earth elements (REE) project in British Columbia.

In a non-brokered private placement, MLIB has purchased 2.6 million common shares of Defense for CA$0.26 per share for a total of CA$665,027, which the company plans to use to advance Wicheeda. Defense hopes it can take on China in supplying the REEs needed for a cleaner economy.

In what one analyst is calling a "unique partnership," Defense and MLIB also have entered into a joint planning approach for decisions regarding design, technical, social, engineering, and environmental aspects of the project.

"Together, we are pioneering a new standard in collaborative project development, which is a true form of reconciliation," said MLIB Chief Harley Chingee. "We're proud to be a part of a project that will be a key contributor to global energy transition goals and one that will deliver long-term economic benefits to our community for generations to come."

China is responsible for two-thirds of current REE mine production and more than 85% of the refined output of REEs at Wicheeda. Defense Metals looks to produce as much as 1/10 of the world's needs for the elements when it hits full production.

More Details of Agreement

As part of the agreement, Defense and MLIB will "incorporate MLIB's interests and priorities in the planning and design of future feasibility studies and the environmental process and include MLIB involvement in certain technical studies related to the Wicheeda project," the company said in a release.

Josie Osborne, minister of energy, mines, and low carbon innovation for British Columbia, said the collaboration demonstrates how "early-stage consultation with First Nations can bring important projects to life in a way that benefits everyone."

"Partnerships like this play a pivotal role in shaping BC's natural resources future as we lay a concrete path toward achieving our net-zero goals through collaboration and advancing reconciliation," she said.

Defense said budgets and work plans will also be cooperatively developed.

Agreement Is 'Long-Term and Mutually Beneficial'

The company will also make an upfront payment to MLIB to fund the costs of participating in review activities and support MLIB members attending post-secondary education in a mining field.

"We're proud to partner with MLIB, and these strategic agreements exemplify a shared vision and commitment to realizing the full potential of the Wicheeda Project and the positive impact it will have on the global critical minerals transition," Defense Metals Chief Executive Officer Craig Taylor said. "Through both agreements, McLeod Lake Indian Band stands to reap mutual benefits from our combined efforts around the Wicheeda project."

Analyst Mark Reichman of Noble Capital Markets noted the "community benefits" of the "unique cooperative."

Analyst Mark Reichman of Noble Capital Markets noted the "community benefits" of the "unique cooperative."

"With this agreement, we think Defense Metals promotes a long-term and mutually beneficial relationship with the McLeod Lake Indian Band, which will also have a vested interest in the success of the Wicheeda rare earth project," wrote Reichman, who rated the stock Outperform with a CA$0.70 per share price target.

"In our view, the Wicheeda rare earth element project has several competitive advantages, including a mining-friendly location, an existing mineral resource with significant expansion potential, an open pit project with favorable metallurgy and well-developed nearby infrastructure, and a strong technical team," Reichman noted. "We think the codesign agreement represents a significant step forward in advancing the Wicheeda project."

The Catalyst: Deepening Divide With China

Rare earth elements are an important part of the shift to clean energy. They are used for purifying water, MRIs, fertilizers, weapons, scientific research, wind turbines, computers, and permanent magnet motors for EVs.

But developing a new mine can take years, and China has escalated the faceoff, saying it will standardize its REE industry. It already has put restrictions on the exports of some of the substances. In December, the communist country banned exporting technologies for processing REEs. Other restrictions by China have affected the export of some graphite products used in electric vehicle (EV) batteries and other elements important to the semiconductor industry.

"The country's government can single-handedly halt the output of REEs," the Canadian Mining Report wrote of China.

"We're in a cold war essentially on the trade front now," Jeff Green, a defense industry consultant and Washington lobbyist, told The Washington Post.

The global market for REEs is expected to grow from US$2.6 billion in 2020 to US$5.5 billion in 2028, according to a report by Fortune Business Insights.

"The rising demand for consumer durables such as tablets, laptops, and smartphones (are some) of the factors driving the consumption of rare earth elements," the report said. "The demand for these elements in developing economies is estimated to expand rapidly."

streetwise book logoStreetwise Ownership Overview*

Defense Metals Corp. (DEFN:TSX.V; DFMTF:OTCQB; 35D:FSE)

*Share Structure as of 1/18/2024

Defense also recently released a significant upgrade to the mineralization of the project with a new mineral resource estimate for Wicheeda. The updated MRE increased the total rare earth oxide (TREO) by 17%, or a 31% tonnage increase, compared to a prior MRE in 2021.

Reichman said the company was "on a positive trajectory going into 2024." 

Ownership and Share Structure

About 5% of the company's stock is owned by insiders, including Director Andrew S. Burgess with 1.55% or 3.98 million shares, and CEO Taylor with 0.98% or 2.5 million shares, according to Reuters.

About 11% of the company is owned by institutional entities, including RCF Opportunities Fund II LP, with 10%, the company said. The rest, 84%, is retail.

Defense Metals has a market cap of CA$61.39 million with 255.78 million shares outstanding and 245.49 million free-floating. It trades in a 52-week range of CA$0.39 and CA$0.15.

Sign up for our FREE newsletter

Important Disclosures:

  1. Defense Metals Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
  2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Defense Metals Corp.
  3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
  4. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

For additional disclosures, please click here.

Disclosures for Mark Reichman, Noble Capital Markets, Jan. 18, 2024:

All statements or opinions contained herein that include the words "we", "us", or "our" are solely the responsibility of Noble Capital Markets, Inc. ("Noble") and do not necessarily reflect statements or opinions expressed by any person or party affiliated with the company mentioned in this report. Any opinions expressed herein are subject to change without notice. All information provided herein is based on public and non-public information believed to be accurate and reliable, but is not necessarily complete and cannot be guaranteed. No judgment is hereby expressed or should be implied as to the suitability of any security described herein for any specific investor or any specific investment portfolio. The decision to undertake any investment regarding the security mentioned herein should be made by each reader of this publication based on its own appraisal of the implications and risks of such decision.

This publication is intended for information purposes only and shall not constitute an offer to buy/sell or the solicitation of an offer to buy/sell any security mentioned in this report, nor shall there be any sale of the security herein in any state or domicile in which said offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or domicile. This publication and all information, comments, statements or opinions contained or expressed herein are applicable only as of the date of this publication and subject to change without prior notice. Past performance is not indicative of future results.

Noble accepts no liability for loss arising from the use of the material in this report, except that this exclusion of liability does not apply to the extent that such liability arises under specific statutes or regulations applicable to Noble. This report is not to be relied upon as a substitute for the exercising of independent judgement. Noble may have published, and may in the future publish, other research reports that are inconsistent with, and reach different conclusions from, the information provided in this report. Noble is under no obligation to bring to the attention of any recipient of this report, any past or future reports. Investors should only consider this report as single factor in making an investment decision.


This publication is confidential for the information of the addressee only and may not be reproduced in whole or in part, copies circulated, or discussed to another party, without the written consent of Noble Capital Markets, Inc. ("Noble"). Noble seeks to update its research as appropriate, but may be unable to do so based upon various regulatory constraints. Research reports are not published at regular intervals; publication times and dates are based upon the analyst's judgement. Noble professionals including traders, salespeople and investment bankers may provide written or oral market commentary, or discuss trading strategies to Noble clients and the Noble proprietary trading desk that reflect opinions that are contrary to the opinions expressed in this research report.

The majority of companies that Noble follows are emerging growth companies. Securities in these companies involve a higher degree of risk and more volatility than the securities of more established companies. The securities discussed in Noble research reports may not be suitable for some investors and as such, investors must take extra care and make their own determination of the appropriateness of an investment based upon risk tolerance, investment objectives and financial status.

Company Specific Disclosures

The following disclosures relate to relationships between Noble and the company (the "Company") covered by the Noble Research Division and referred to in this research report.

The Company in this report is a participant in the Company Sponsored Research Program ("CSRP"); Noble receives compensation from the Company for such participation. No part of the CSRP compensation was, is, or will be directly or indirectly related to any specific recommendations or views expressed by the analyst in this research report.

Noble intends to seek compensation for investment banking services and non-investment banking services (securities and non-securities related) within the next 3 months.

Noble is not a market maker in the Company.



Senior Equity Analyst focusing on Basic Materials & Mining. 20 years of experience in equity research. BA in Business Administration from Westminster College. MBA with a Finance concentration from the University of Missouri. MA in International Affairs from Washington University in St. Louis.
Named WSJ 'Best on the Street' Analyst and Forbes/StarMine's "Best Brokerage Analyst."
FINRA licenses 7, 24, 63, 87.


Unless otherwise noted through the dropping of coverage or change in analyst, the analyst who wrote this research report will provide continuing coverage on this company through the publishing of research available through Noble Capital Market's distribution lists, website, third party distribution partners, and through Noble’s affiliated website,


This report is intended to provide general securities advice, and does not purport to make any recommendation that any securities transaction is appropriate for any recipient particular investment objectives, financial situation or particular needs. Prior to making any investment decision, recipients should assess, or seek advice from their advisors, on whether any relevant part of this report is appropriate to their individual circumstances. If a recipient was referred to by an investment advisor, that advisor may receive a benefit in respect of transactions effected on the recipients behalf, details of which will be available on request in regard to a transaction that involves a personalized securities recommendation. Additional risks associated with the security mentioned in this report that might impede achievement of the target can be found in its initial report issued by . This report may not be reproduced, distributed or published for any purpose unless authorized by .

Independence Of View
All views expressed in this report accurately reflect my personal views about the subject securities or issuers.

Receipt of Compensation

No part of my compensation was, is, or will be directly or indirectly related to any specific recommendations or views expressed in the public appearance and/or research report.

Ownership and Material Conflicts of Interest

Neither I nor anybody in my household has a financial interest in the securities of the subject company or any other company mentioned in this report.

Want to read more about Critical Metals investment ideas?
Get Our Streetwise Reports Newsletter Free and be the first to know!

A valid email address is required to subscribe