Graphite is one of fourteen critical minerals that were identified by a recent report by the European Commission as being under “supply risk”.
According to the United States Geological Survey (USGS), world production of natural graphite in 2008 was 1,110 thousand tonnes (kt), of which the following major exporters are: China (800 kt), India (130 kt), Brazil (76 kt), North Korea (30 kt) and Canada (28 kt). The mineral graphite is one of the eight allotropes of carbon. The most common allotrope being diamonds. While diamonds are a girl’s best friend could graphite become an investor’s best friend? Greg Bowes, President and CEO of Northern Graphite certainly thinks so and points to graphene, a next-generation material made from graphite.
Graphene is a one-atom-thick planar sheet of carbon atoms that are densely packed in a honeycomb crystal lattice. It can be thought of as an atomic-scale chicken wire made of carbon atoms and their bonds. Scientists around the world believe that graphene is a strong candidate to replace semiconductor chips. Moore’s Law observes that the density of transistors on an integrated circuit doubles every two years. But silicon and other existing transistor materials are thought to be close to the minimum size where they can remain effective. Graphene transistors can potentially run at faster speeds and cope with higher temperatures. Graphene could be the solution that will allow computing technology to continue to grow in power whilst shrinking in size, extending the life of Moore’s law by many years.
Northern Graphite, based in Ottawa, recently closed a $4 million initial public offering at $0.50 per unit and began trading on the TSX-V Exchange on April 20th, 2011. And so far so good. The company’s shares took-off and hit a high of $1.55 in early June and have since settled back to the $1.20 range. Northern Graphite’s principal asset is the Bissett Creek graphite project located 100km east of North Bay, Ontario. The Company has completed an NI 43-101 preliminary assessment report on the project and anticipates that it will be in a position to begin construction of the mine early in 2012, subject to positive results from the bankable final feasibility study and the availability of financing.
MiningFeeds.com recently sat down with Northern Graphite’s top executive Greg Bowes to talk about the company’s future prospects and to learn more about the project.
To provide some context for our readers, why should an investor be looking at graphite mining as an opportunity?
Lithium and rare earths have demonstrated that it is possible to make money with minerals other than precious and base metals. Now investors are looking for other strategic minerals that are undervalued and, in our opinion, graphite is one of them. Graphite industrial demand is growing 5% per year due to the effect of growing demand in China and India for traditional steel and auto markets. Since 2005, the price of graphite has increased by almost three times. New uses like lithium ion batteries, fuel cells, nuclear and solar are all big graphite users and will create more demand as these technologies become more widely adopted. Currently, China produces 70% of the world’s graphite and its production and exports are expected to decline like in the situation of the rare earth elements.
Please tell us about your project?
Northern Graphite has a large resource, located in Canada close to infrastructure, with simple open pit mining and metallurgy. The deposit will produce high value, high growth, flake graphite. The company expects to have a bankable feasibility and permitting done and start construction in the first part of 2012.
What are some of the challenges associated with developing and mining graphite?
In our case, not many. Our project involves simple mining methodologies and metallurgy. As mentioned before, our project is close to infrastructure and with no environmental issues.
Who are the dominate players in the industry and, once mined, how is graphite bought and sold?
China, in general terms is the dominant player since they produce 70% of the world’s supply. Most other mines outside of China are owned by large private industrial companies. There are only two public companies in North America with graphite development projects. There is no spot market for graphite, prices are negotiated between buyers and sellers but it is a very large and efficient market. Prices for the most common grades are published in industrial minerals magazine.
In 2010, scientists at the University of Manchester won the Noble Prize in Physics for isolating graphene. Please tell our readers about graphene and what applications it might be used for.
Graphene is transparent in infra-red and visible light, flexible, and stronger than steel. It conducts heat 10 times faster than copper and can carry 1,000 times the density of electrical current of copper wire. Graphene is expected to be a revolutionary material that could change the technology of semiconductors and LCD touch screens and monitors, create super small transistors and super dense data storage, increase energy storage and solar cell efficiency, and will transform many other applications. According to a professor at Georgia Tech University, there are nearly 200 companies, including Intel and IBM, currently involved in graphene research. In 2010 graphene was the subject of approximately 3,000 research papers and the European Union and South Korea have each recently started $1.5 billion efforts to build industrial scale, next generation display materials using graphene.
Having just listed on the TSX-V Exchange in April of this year, what are your plans for the balance of 2011 and beyond?
We are working towards a new resource estimate for next month; and, a bankable feasibility study and hopefully a strategic partnership by the end of the year. Next year, we would like to have our permitting completed in early 2012 and construction start-up shortly thereafter.
This interview is featured in the article 5 Critical Mineral Stocks to Watch – CLICK HERE – to read more.