IM Graphite News in Brief 19 – 25 June

By Laura Syrett, James Sean Dickson
Published: Thursday, 25 June 2015

Flinders halts operations at Woxna until markets improve; Focus signs offtakes with graphene partner business; Valence commences operational graphite production.

TSX-V-listed Flinders Resources Ltd is to pause operations at its Woxna graphite mine and plant in Sweden until prices and market demand improve.

Flinders’ CEO, Blair Way, said that even though the project had produced graphite to commercial grades and specifications at competitive costs, weak global demand for flake graphite in 2015 had pushed prices to four-year lows of less than $700/tonne.

He added that the decision had been taken to conserve the company’s cash position of Canadian dollar (C$) 4m ($3.2m*) and that the plant will be maintained on a "production ready" basis.

Since recommissioning the past-producing Woxna mine in July last year, Flinders has sought to place its material in the European market and is targeting the high purity (99.9% C) battery graphite industry with its material.

Industry observers told IM that the shuttering of Woxna was a "reality check" for many graphite exploration companies still quoting inflated prices. "We may see a rebound and then a levelling out, but many of the price expectations we see from pre-production companies are likely to be disappointed," one market participant said.

In Canada, Vancouver-headquartered miner Eagle Graphite Inc. has produced 99.995% pure spheronised graphite from a sample of flake graphite taken from the company’s Black Crystal project in British Columbia.

Eagle’s president, Jamie Deith, said that the company had exceeded its target for producing battery-grade purity material "by a comfortable margin".

The company said that it achieved the result without using the toxic substances hydrofluoric acid or caustic soda, which is significant given the growing consumer emphasis on "green" production methods within the lithium-ion (Li-ion) battery supply chain.

Eagle, which floated on the TSX-V in January, is expanding its production and exploration projects in Canada and said it aims to focus on the growing Li-ion market.

Also in Canada, Focus Graphite Inc. has signed two strategic offtake agreements with its graphene technology partner, Grafoid Inc.

The first offtake, referred to as the 'Energy Offtake’, commits Grafoid to acquire up to 1,000 tpa large flake graphite from Focus’ Lac Knife project in Quebec, representing nearly 7% of the mine’s estimated annual large flake production of 14,606 tpa.

The second offtake, referred to as the "Polymer Offtake", will see Grafoid take up to 25,000 tpa of Lac Knife’s graphite, or 56.4% of total yearly output, across all flake categories.

Prices were not disclosed, but Focus’ CEO, Gary Economo, said that initial terms for the offtakes had been laid down and that the agreements reflected the strong, strategic relationship between the two businesses. Grafoid Inc. has developed and patented its own brand of natural graphite derived graphene product, which it markets under the trademark, MesoGraf.

Australian graphite developer Western Mining Network Ltd has signed a memorandum of understanding to acquire 51% of South Korea-based graphene and carbon materials manufacturer, Carbon Nano-Material Technology Co. Ltd.

Western said the deal was a first step in its long-term strategy to supplement its in-house expertise in adding value to natural graphite material by employing complementary third party technology.

The ASX-listed company is developing the Tamboli graphite project on the island of Sulawesi in Indonesia, where drilling is underway in preparation for a JORC resource estimate on the property.

Also in Australia, Valence Industries Ltd has begun operational graphite production at its Uley project in South Australia.

The company is aiming to reach the facility’s nameplate capacity of 14,000 tpa graphite by September 2015.

Valence will commence graphite shipping from the project via Port Adelaide this month, under existing contracts to customers in Europe. Asia Pacific customers will see their shipments sent shortly after.

The company’s current rights issue to raise up to Australian dollar (A$) 9.4m ($7.26m) closes today.

In the US, TSX-V-listed Alabama Graphite Corp. has reported average graphite grades of between 2.72% C and 6.12% C from assay results of samples taken from its Coosa graphite project in Alabama.

The company said that the latest set of results was for holes drilled on the northeast portion of the property and that the drilling was aimed at expanding the resource in this direction. Metallurgy tests on the samples showed material in the +80 mesh range.

Alabama Graphite expects to release further results over the next several weeks as its drilling programme progresses and aims to complete an updated resource estimate for Coosa before the end of the summer. A preliminary economic assessment of the project is expected in the third quarter.

ASX-listed Metals of Africa Ltd has discovered high grade graphite mineralisation at its Montepuez central graphite project in Mozambique, with tests on samples from the property’s Buffalo prospect yielding grades of 9.86% C from surface to a depth of 50 metres.

Drilling results at Montepuez’s Elephant prospect indicated visual graphite mineralisation with grades estimated at between 5% C and 15% C between 8.7 metres and 93 metres.

The site’s Lion prospect was also drilled and the company said that all three prospects host different mineralisation characteristics.

Metals of Africa said it expects the present drilling programme to be finished by August, with a maiden JORC resource estimate for Montepuez set to commence afterwards.

Back in Canada, Noveau Monde Mining Enterprises Inc. has decided to focus on the Tony claim block (formerly known as the Hotel claim block) at is Matawinie graphite property in Quebec.

The company said that it has received all the permitting necessary to proceed with work at Tony. This will consist of stripping and trenching and 9,000 metres of core drilling with the aim of defining an NI 43-101 graphite resource before the end of this year.

The block, which is located 130km north of Montreal, has been renamed after the geologist Antoine Cloutier, who discovered and outlined the extent of graphite mineralisation at the site.

In graphene news, ASX-listed Talga Resources Ltd has announced positive results from a 10-month assessment on graphite and graphene samples from its Nunasvaara deposit in Sweden by the Commonwealth Scientific and Industrial Research Organisation (CSIRO).

CSIRO’s 128-page report found that Nunasvarra’s graphite is highly crystalline, was formed from a biogenic carbon source and that graphene liberated by Talga from the ore showed thin, electron transparent 2-10 micron size properties.

"The tests achieved our objective of gaining a deeper insight to our natural graphite-graphene deposits via a mineralogical characterisation at a larger scale than provided by our nanotechnology research programs," Mark Thomspon, Talga’s CEO, said.

"This provided new data to better interpret how the deposit’s graphite mineralisation formed. We believe this interpretation will improve project economics as it facilitates optimised mining and processing performance and highlights ideal conditions under which deposit extensions may be found," Thompson added.

Finally, in the UK, AIM-listed Haydale Graphene Industries Plc has applied for a patent in China on an aspect of its plasma graphene functionalisation process.

"I am very pleased that our application for a patent in China has been allowed. This confirmation that we will soon be granted our first patent is a real milestone in our intellectual property (IP) strategy and protects our key technologies," Ray Gibbs, Haydale’s chief executive, said.

"According to some research China is the region with the most graphene related patent applications and a revenue compound annual growth rate (CAGR) of 95% to 2020 driven in the main by 'graphene’ composites," Gibbs added.

*Conversions made June 2015