TSX:EGZ - Post Discussion
Post by
shakerman640 on Sep 24, 2014 10:40am
Simon Moores comments on what makes a good graphite project
According to Simon Moores, manager of Industrial Minerals Data:
https://www.kitco.com/ind/MiningReport/2014-01-15-2014-Graphite-Outlook-Price-Rebound-Supply-Shift-and-New-End-Uses.html
TMR: What should get investors excited and involved in graphite in 2014?
SM: The fundamentals haven't changed since the price spike and exploration boom of 2010-2011. The key elements are China's dominance, China's mining regulation plans and the emergence of new markets.
I would look at refractories versus batteries. Manufacturers of refractories are trying to get higher quality graphite. Battery manufactures are competing for the same grade—large flake, higher purity graphite. Most of the mines around the world can't supply sufficient volumes. That presents a great opportunity for anyone trying to build a new mine.
TMR: Readers of The Mining Report are mostly familiar with small-cap graphite explorers and developers. In that sector, what makes a good graphite project?
SM: It's a balancing act. It comes down to the product the project can produce, who would want to buy it and how economical the resource is. Grade is important. Typically, higher purity in the ground translates directly into a more economical resource. Flake size is also key, because buyers are demanding larger flake (plus-80 mesh and higher) and higher purity (95%, 96%, 97% and 98% C).
The size of the resource is somewhat less important from end user and industry perspectives. After all, industry consumes a maximum of 450,000 tons per year, in a good year. But I can understand that an investor would want to see large, confirmed resources for long-term business plans.
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