Strategic Metals Ltd. is an actively managed junior exploration company with working interests in more than 90 mineral properties. Its assets also include a large cash position, a valuable portfolio of shares in other resource companies and potentially valuable royalty interests.

Strategic's property interests span a widely diverse suite of commodities that have recently been expanded to include gold. All of the properties are in politically stable jurisdictions with flow-through eligibility. Most are located in mining friendly Yukon or in established porphyry belts of British Columbia.

Strategic is following a multifaceted business model, which is working to build value by various means including grassroots project generation and selective drilling aimed at major discoveries. Key elements of this business model include:

  • The generative exploration model involves researching and acquiring promising prospects, advancing those prospects to drill stage and then optioning or selling them to other parties. This model manages risk while leveraging exploration expenditures. When successfully implemented, it can yield Strategic cash payments and/or shares, whose total value greatly exceeds Strategic's research, acquisition and exploration costs. In most instances, the option or sales agreements also provide Strategic with working interests or royalty interests in the subject properties.

  • Strategic occasionally recognizes opportunities where a discovery premium can be added to the value of a property by drilling and thereby making a major discovery. Properties that fall in this category typically have exceptional size or grade potential, host metals that are in high demand and are well located relative to known deposits and infrastructure. This strategy can return much greater rewards to Strategic but involves greater exploration risk. In 2010, Strategic plans to drill nine highly prospective properties.

  • Strategic manages a large portfolio of shares that it has acquired through its various option and sales agreements, by participating in private placements or through its investment fund. These share transactions have helped Strategic build a large amount of working capital. Investment returns have been lead by Strategic's 13% interest in ATAC Resources Ltd., which owns the Rau gold deposit.

  • Some royalty interests held by Strategic are expected to yield cash flow - most notably a net smelter return royalty in part of the Wolverine project, which is scheduled for production in mid-2010.

  • Strategic has an active share buy back plan, which makes purchases when trading prices fall significantly below the value of working capital per share.




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