IM Graphite News in Brief 28 August – 3 September

By Laura Syrett
Published: Thursday, 03 September 2015

StratMin gets $3m farm in from ASX miner; Graphitecorp prepares to list on ASX.

UK AIM-listed StratMin Global Resources Plc has increased its exposure to the Australian capital markets through a farm in agreement with ASX-listed Bass Metals Ltd, a Tasmania-focused polymetallic mining company.

The deal gives Bass a 35% stake in StratMin’s Loharano graphite mine in Madagascar, via an initial £2m ($3.04m*) investment in StratMin’s subsidiary, Graphmada Mauritius. The investment will be made in two tranches, giving Bass an interest of 25% by the end of November, followed by a further 10% by the end of this year.

Brett Boynton, StratMin’s Australia-based CEO, told IM that although such farm in deals were not commonplace in the mining industry, the deal with Bass is a cost effective way of gaining access to the buoyant Australian graphite investment market.

"We have such a big and robust market here, so we were eager to be a part of it," he said. He added that Bass, which shares two of its non-executive directors with StratMin, had been looking for exposure to the renewable energy resource space.

Boynton said that StratMin’s immediate near term goal is to get the Loharano processing plant running 24 hours a day. The company has an offtake agreement with a North American graphite buyer and a joint venture for its Madagascar exploration activities with Indian miner, Tirupati Carbons and Chemicals.

In Australia, Brisbane-based Graphitecorp Pty Ltd is gearing up for an initial public offering (IPO) on the Australian Securities Exchange (ASX) as it prepares for its maiden drilling programme at the Mount Dromedary graphite project, north of Cloncurry in Queensland.

Greg Baynton, director of Orbit Capital, which has been working with Graphitecorp, said that the company aims to mine and export flake graphite – a new commodity for Queensland – with a focus on markets in the Asia-Pacific region.

Baynton told IM that surface mapping and sampling performed at Mount Dromedary had encouraged the company to move forward with further exploration at the site. Anecdotal reports from early work at the deposit suggest graphite outcrops run over a distance of 3km and runs to depths of up to 50 metres.

Graphite from TSX-V-listed Energizer Resources Inc.’s Molo graphite project in Madagascar has been successfully manufactured into material suitable for use in lithium-ion (Li-ion) battery applications.

Energizer said that the trial processing had been performed by two independent parties: a prominent Japanese manufacturer of lithium battery anode material and a leading European supplier of spherical graphite for electric vehicles (EVs).

The company added that that both parties are subject to confidentiality agreements and that Energizer will now move to the next stage in product analysis, which will include additional bulk samples testing stages along each of the manufacturers respective supply chains.

In Sweden, Talga Resources Ltd has announced a maiden JORC mineral resource estimate of more than 31.5m tonnes with 14.9% graphite for its Jalkunen project.

Jalkunen is the third of Talga’s graphite resources in Sweden and takes the company’s total inventory in the country to more than 43m tonnes.

Talga said that ore from the deposit is amenable to the same graphite liberation process used for material taken from its Vittangi graphite project, located 50km northwest of Jalkunen.

ASX-listed IMX Resources Ltd has estimated a maiden exploration target of 100-350m tonnes graphite, grading at approximately 3-11% C, at its Chilalo graphite project in Tanzania.

This is on top of the existing Shimba graphite resource of 18.1m tonnes grading at 6.2% C. The company now plans to complete a feasibility study next month for a 50,000 tpa flake graphite operation at Shimba and outline a timeline to production.

In neighbouring Mozambique, ASX-listed Mustang Resources Ltd has entered into a non-binding term sheet for an option to acquire two additional graphite licences in Cabo Delgado province.

Mustang is currently flying electromagnetic (EM) surveys over its six licences in the area and plans to fly over a further four licences, two of which it will now have an option to acquire. The company has agreed to pay Australian dollar (A$) 150,000 ($105,453) in ordinary share capital plus A$50,000 in cash in return for the option.

Globe Metals and Mining Ltd has signed an agreement with the Malawi Ministry of Natural Resources, Energy and Mining for exploration and mining rights to the historic Katengeza graphite prospect in Malawi.

Globe, which is listed on the ASX, said that Katengeza was explored for graphite before 1964, when Malawi was under British colonial rule.

The company has undertaken a preliminary assessment of the site, which included mapping and rock chip sampling and said that the results suggest the area’s mineralisation is equivalent to Globe’s neighbouring Chimutu graphite prospect, which lies within its Chiziro project licence area.

Also in Malawi, Sovereign Metals Ltd has released the results of a scoping study on its Duwi graphite project which it said confirms the deposit could support a production rate of 110,000 tpa graphite concentrate over an initial mine life of 20 years.

The company said that the project would require an initial capital investment of $112m and incur life-of-mine operating costs of $498/tonne of concentrate. The findings were based on a mineral resource estimate of 77.3m tonnes graphite with an average grade of 7.2% C.

MRL Corp. has appointed Australia’s Imagine Intelligent Materials to characterise and certify the company’s graphite and graphene products, made from vein graphite ore mined in Sri Lanka, with the objective of selling them for graphene applications.

MRL, which is also headquartered in Australia, said that Imagine would additionally negotiate sales on behalf of MRL, which is preparing for first production at its Sri Lankan graphite projects.

The explorer said that final engineering studies for construction of headframes are underway at its Aluketiya site. The headframes will be used to recover graphite from shallow shafts.

Fellow Australian explorer Ardiden Ltd has identified multiple new prospective targets at its Manitouwadge graphite project in Ontario, Canada, following a detailed geophysical review of EM data.

Ardiden said that the review identified a number of new EM anomalies with lengths of up to 2,600 metres. A team has been mobilised to undertake a mapping and sampling programme on the newly identified areas and an application for a work programme to target potential graphite zones will be lodged shortly.

Back in Australia, Archer Exploration Ltd has announced that testing by the University of Adelaide has shown that plant growth is significantly boosted when raw graphite from the company’s Sugarloaf deposit is used as a soil conditioner.

The findings were based on 30-day wheat trials, designed to test the soil nutrition and water retention properties of ore taken from Sugarloaf, which is located on the Eyre Peninsula in South Australia.

Archer said that no processing of the ore is required for it to be used as a soil conditioner and that the results indicate the potential for graphite to be used as a high value agricultural product.

In financial news, ASX-listed Kibaran Resources Ltd has received confirmation of "in principle eligibility for cover" from the German government in respect of a loan for its Epanko graphite project in Tanzania.

Kibaran said that the confirmation is the first important condition required to receive a UFK guarantee from the German government, in combination with financing from the country’s state-owned KfW IPEX-Bank.

The German government provides UFK, or untied loan guarantee, coverage in the form of guarantees for loans awarded by lenders for the financing of eligible projects. The confirmation is based on Kibaran’s offtake partners, ThyssenKrupp AG and an unnamed European trader, supplying German industry with graphite.

Canada-based Focus Graphite Inc. has closed the first tranche of a non-brokered private placement for gross proceeds of Canadian dollar (C$) 429,829 ($326,133) in return for just over 3.3m units, issued at a price of C$0.13/unit.

Each unit comprised of one common share in Focus and one common share purchase warrant, entitling the holder to acquire one additional common share in the company at a price of C$0.17/share until 28 August 2019. Focus said it expects to proceed shortly with a second tranche, which will take gross proceeds of the offering up to C$2m.

The company is developing the Lac Knife graphite project in Quebec.

Nouveau Monde Mining Enterprises Inc. has closed the final tranche of two non-brokered private placements for total proceeds of C$2.995m, following the issue of around 7.8m units.

The proceeds will be used to cover working capital and exploration expenses at the company’s Matawinie graphite property in Quebec.

TSX-V-listed Great Lakes Graphite Inc. is to receive a contribution of up to Canadian dollar C$30,000 from the National Research Council of Canada Industrial Research Assistance Program to support graphite purification development at Process Research ORTECH, located in Mississauga, Ontario.

The company said that the main objective of its partnership with Process Research ORTECH is to develop a purification process that will achieve a graphite product of over 99% purity that is both highly economical and has the lowest possible environmental impact.

Finally, Zenyatta Ventures Ltd has granted 950,000 options to management, directors and advisors of the company at an exercise price of C$1.43/share for a period of five years.

IM’s 5th Graphite & Graphene Conference will be held on 8-9 December at the Waldorf Hilton in London. For more information, contact Peter Gilfillan

*Conversions made September 2015