NMG's value proposition is up with the favorable BAPE decisiThe provincial bureau in charge of carrying the environmental and social assessment on NMG’s Matawinie mining project released a favorable decision yesterday. This is a very important milestone and the company believes is only a few months away from the government decree authorizing the construction. Please see this news release for additional information. The company says that if authorizations and rights are indeed granted, preparatory work on the mine site shall start in Q4 of 2020.
This is a very good news indeed and it was to be expected given the extensive work that the team at NMG has done while working on completing this key environmental and social assessment.
Graphite is a key battery material enabling the lithium-ion technology. There is no replacement to graphite and no replacement shall be expected in the long term. In fact, raw materials specialists and battery experts believe that we shall be expecting an evolution of lithium-ion rather than a breakthrough in technology. A few weeks ago, I listened to a presentation by Sam Jaffe of Cairn Research. Sam specializes in battery technology and the markets where they are used. He does not see anything on the horizon that would replace graphite in the anodes. What he sees happening though is a trend in increasing silicon doping of graphite anodes. This appears to be the safest and cheapest way to increase energy density. He believes that graphite anodes could contain up to 15% silicon on average by 2040. Today, doped graphite anodes contain less than 5% silicon.
Bottom line, the demand picture for graphite anode material is very bright as the world is transitioning away from fossil fuels. China cannot be the sole provider of purified spheronized anode material!
Here is a recap of Nouveau Monde Graphite’s value proposition:
- China is currently supplying 100% of purified spherical graphite for lithium-ion battery anodes. Clearly, the supply chain needs to transition away from full dependence on a single jurisdiction; NMG’s business plans is to become the largest graphite operation in the Western world. 553 GWh of battery capacity is being built in North America and Europe;
- NMG’s is developing its business to become a vertically integrated producer of value-added products. The company could eventually reach 100,000 tonnes of graphite anode materials per year;
- The company’s business development is governed by ESG principles. Zero emissions hydroelectricity will be used throughout the value chain. This is important as some car OEMs such as Volkswagen have started issuing sustainability scores to their suppliers;
- Mine tailings will not rely on dams but rather on co-disposal management and progressive land reclamation;
- Pallinghurst Group of London is a major shareholder. Traxys trading house has an offtake agreement with NMG. Both have earmarked $2B for investing in sustainable battery material projects.