CUPANI Metals: Starting to Explore a Promising Copper-Palladium-Nickel Project in Quebec in 2026

Key Concepts

• Blue Lake Project: Kani Metals' copper, nickel, PGM (Platinum Group Metals) project in Quebec.
• Copper Equivalent (CE): A metric used to express the combined value of different metals in a deposit, calculated based on their relative prices.
• Magmatic Nickel Sulfide Deposit: A type of geological deposit formed by the cooling and solidification of magma, where sulfide minerals (containing nickel, copper, and PGMs) concentrate.
• PGMs (Platinum Group Metals): A group of six precious metals: platinum, palladium, rhodium, ruthenium, iridium, and osmium.
• Quebec's Exploration Rebate: A government program in Quebec that refunds a percentage of exploration expenses to companies.
• Shefferville, Quebec: A town in Quebec with existing mining infrastructure, located near the Blue Lake project.
• Internal Combustion Engine (ICE): A type of engine that burns fuel to produce power, commonly used in vehicles.
• Catalytic Converter: A device in vehicle exhaust systems that reduces harmful emissions, often containing platinum and palladium.

Blue Lake Project: A Historical and Future Perspective

Kani Metals is developing the Blue Lake project in Quebec, a copper, nickel, and PGM deposit with a rich history. Mineralization was first discovered in the 1940s and 50s, but the platinum and palladium content was not recognized at the time. In the 1980s, a company re-examined historical drill core and identified significant platinum and palladium values. This led to approximately $50 million (in today's dollars) being spent on exploration, resulting in 200 drill holes and the delineation of roughly 5 million tons of material with a 2.3% copper equivalent grade. This equivalency was composed of approximately 45% copper, 45% nickel, 5% platinum, and 5% palladium. However, a decline in platinum and palladium prices in the early 1990s prevented the project from moving into production.

A key aspect of the Blue Lake project's history is that the previous owners retained legal title to the historical tonnage until 2023. Kani Metals' strategy involved acquiring the surrounding exploration land, which had been staked by Ned Goodman and Douglas McCrory, to consolidate the entire potential deposit. This consolidation was achieved in January 2023, allowing Kani Metals to integrate the historical resource with new exploration targets. The company has since completed its second field season and plans to commence its first drilling program in January 2026.

Quebec: A Premier Mining Jurisdiction

Brian Bos, CEO of Kani Metals, highlights Quebec as an exceptional jurisdiction for mining exploration. He cites several advantages:

• Clear First Nation Rules: The regulatory framework for engaging with First Nations is well-defined.
• Generous Exploration Rebates: Under the latest Quebec budget, companies receive a 45% cash rebate on exploration expenses incurred in the field. This rebate must be reinvested in further field exploration, a condition Bos welcomes.
• Synergy with Other Tax Credits: When combined with other Canadian tax credits, the effective cost of exploration can be significantly reduced. For instance, raising $1,000 can result in $2,500 being spent on exploration.

Infrastructure and Proximity to Shefferville

The Blue Lake project is strategically located 70 kilometers from Shefferville, Quebec. Shefferville is a well-established town with a history of iron ore mining dating back to the 1940s. The town boasts:

• Existing Open Pit Mines and Mills: Infrastructure for mining operations is already in place.
• Railway Access: A railway connects Shefferville to the Atlantic Ocean, facilitating ore transportation.
• Airport and Townsite: Essential services and transportation links are available.

Access to the Blue Lake project from Shefferville is via road in the winter and float plane or helicopter in the summer.

Future Exploration and Growth Potential

The upcoming drilling program in January 2026 is designed to test the hypothesis that the Blue Lake deposit extends significantly beyond the known 5 million tons. The geological theory posits a magmatic nickel sulfide system, described as a "river of lava" where copper, nickel, and PGMs precipitated at points where the flow slowed, forming "pods." Kani Metals believes this system could extend for 12 to 20 kilometers, with the current 5 million-ton resource only identified within a 1.5-kilometer strike length.

If the drilling confirms this extended mineralization, the company anticipates significant global attention. The rarity of finding such deposits at or near surface, combined with the project's favorable jurisdiction and proximity to infrastructure, positions the next 12 months as a critical period for Kani Metals.

Financial Position and Insider Ownership

Kani Metals has a strong insider ownership, with insiders holding 40% of the 142 million shares outstanding. Brian Bos himself is the largest shareholder, owning 26% of the company's shares. This high level of insider ownership ensures that management is highly motivated to manage company funds efficiently.

The company currently has $2 million in cash. Additionally, due to the Quebec exploration rebate program, an estimated $2 million is expected to be reimbursed for 2024 and 2025 expenses, effectively bringing the total available funds to approximately $4 million.

Market Outlook for Copper, Nickel, and PGMs

Brian Bos expresses a strong conviction in the long-term prospects of copper, nickel, and PGMs, preferring them over gold for the next decade.

• Copper: Essential for the transition away from oil, indicating sustained demand.
• Nickel: While currently suppressed by Indonesian supply, Bos anticipates a supply crunch within the next three years, which should drive nickel prices higher.
• Platinum and Palladium: Historically priced higher than gold, their prices declined due to concerns about the end of the internal combustion engine (ICE) and its impact on catalytic converter demand. However, Bos believes that both battery-electric vehicles and ICE vehicles will coexist for the next 30 years, suggesting that platinum and palladium prices could rebound to their previous levels relative to gold.

The potential for nickel to catch up to copper prices and for platinum and palladium to catch up to gold prices is seen as a significant catalyst for Kani Metals.

Conclusion and Key Takeaways

Kani Metals' Blue Lake project presents a compelling opportunity in the battery metals and energy metals sector. The project benefits from a historical resource, a promising geological model for significant expansion, a top-tier mining jurisdiction in Quebec with substantial financial incentives, and proximity to existing infrastructure. The company's strong insider ownership and solid financial position, bolstered by anticipated government rebates, provide a stable foundation for its upcoming drilling program. The positive market outlook for copper, nickel, and PGMs further enhances the project's potential. The next 12-18 months, leading up to and including the January 2026 drilling, are expected to be pivotal for Kani Metals as they aim to unlock the full potential of the Blue Lake deposit.