Standard Graphite Acquires Large, High-Grade Graphite Project

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Rapidly emerging graphite company Standard Graphite has just announced a significant acquisition of a high-grade graphite project with a large historical resource.

Rapidly emerging graphite company Standard Graphite has just announced a significant acquisition of a high-grade graphite project with a large historical resource.-- (Financial Press)

Earlier today the company announced it had successfully acquired the Mousseau East Deposit. The project has many inherent advantages including size, grade, and history.

The Mousseau East Deposit was originally discovered in 1983. It’s located in one of the most prolific graphite-bearing regions in the world in Quebec. And it’s only about 50 kilometers of the Lac-des-Iles Graphite Mine, one of North America’s very few operational graphite mines.

The Mousseau East Deposit has had extensive exploration work completed on it throughout the years. Graphicor, the graphite company who previously owned the Mousseau East Deposit, proved up a sizeable historical resource (Note: the resource is based on historical results and is not compliant with NI 43-101 standards).

Based on past drilling results, Graphicor estimated the deposit to contain the following graphite resources:
    Proven – 598,480 tonnes of 8.29% Cg
    Probable – 219,450 tonnes of 8.13% Cg
    Possible – 288,760 tonnes of 7.85% Cg
That puts the Proven, Probable, and Possible historical contained graphite at 90,123 tonnes.
Those estimates were further verified by Derry, Michener, Booth and Wahl (DMB&W).
DMB&W analyzed the exploration data and estimated the Mousseau East Deposit to contain the following graphite resources:
Probable - 578,500 tonnes of 8.02% Cg
Possible - 528,080 tonnes of 8.28% Cg

DMB&W’s estimates confirmed an estimated 90,121 tonnes of high-grade graphite on the Mousseau East Deposit.
On the market, that’s a gross metal value of anywhere between $90 million (@ $1,000 tonne Cg) and $450 million (@ $5,000 Cg) depending on the flake size of the graphite and other graphite market factors. Either way, it’s a sizeable acquisition for Standard Graphite which has a current market capitalization of about $14 million.

The company states the importance of the acquisition by saying it “is now in a position to build a NI 43-101 resource by upgrading the historical non-compliant resource and with strategic exploration of the deposit.”

This is a major step forward for Standard Graphite and is yet another move which further differentiates company. This acquisition gives Stand Graphite the opportunity to accelerate the official delineation of a graphite resource which opens up further later-stage development opportunities. Many junior graphite companies are merely explorers with no known discover and are very long time away from proving up a resource.

The acquisition is also another strategic move in Standard Graphite’s development. The company is one of the early leaders in the graphite boom. It originally acquired its graphite assets last year well before the market for graphite stocks exploded. And the company has also attracted some top talent to drive the projects forward.

Standard Graphite is one of the few companies to hire graphite industry personnel with the experience necessary to make a project and an operational mine successful.

For example, a few weeks ago when the company announced it has added Benoit Gascon as Senior VP of Business Development.
Gascon has more than two decades of experience in the graphite industry. He led one of the few graphite producing mines as president of Stratmin Graphite. The company, under Gascon’s leadership, was eventually taken over by Imerys SA and formed Timcal Graphite. The mine is still in operation today.

After the successful takeover, Gascon stayed on with Timcal. He assumed multiple management positions within Timcal including Senior VP of sales. When dealing with specialty metals like graphite, rare earths, lithium, and others, an executive at the company must be familiar and experienced with the actual marketplaces for these metals.

Gascon is just the latest addition to a growing, experienced team with proven capability.
Patrick Downey is already on the board of advisors to Standard Graphite. He was the CEO of Viceroy Exploration Ltd. before was acquired by Yamana Gold for $600 million. He was also the president of Consolidated Trillion Resources Ltd. and Oliver Gold Corporation, where he negotiated their successful merger to form Canico Resource Corp. Canico was then bought out by CVRD for more than $800 million.

In addition to Downey, Standard Graphite has attracted another prominent leader, Stephen Stanley. Stanley was the President & CEO of Hathor Exploration for five years until it was bought out. Hathor was acquired by Rio Tinto PLC for more than $650 million.

Standard Graphite has been aggressively assembling the projects and personnel to position itself as one of the big success stories in the ongoing graphite boom. The company has multiple other graphite properties and has completed multiple surveys and other geological reconnaissance on them as well.

The Mousseau East Deposit acquisition accelerates the company’s timeline as it’s now in position to develop one of the first 43-101 compliant graphite resources in the rapidly expanding graphite exploration and development industry.

Standard Graphite trades on the TSX Venture Exchange.
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