Blencowe Resources Share Discussion Threads

[soulsauce] 09/2/2022 10:15

Thanks for posting paulie. Very interesting.

[pauliewonder] 09/2/2022 10:01

MR interview
“We are actually already having discussions with some very, very interesting parties...

...it is about bringing them in because whether they are a high-quality offtake partner or a big fund that loves the battery metal space.”

#BRES #Graphite

[pauliewonder] 08/2/2022 21:31

https://www.metalbulletin.com/Article/5083930/Graphite-demand-from-EV-battery-sector-forecast-to-rise-over-35-in-2022.htmlGraphite demand from EV battery sector forecast to rise over 35% in 2022Fastmarkets' assessments of graphite prices were unchanged over the past week, and we expect to see stable pricing persist in China well into February, reflecting both the Lunar New Year holiday and the Beijing Winter Olympics, which will subdue both supply availability and demand from battery makers.Fastmarkets' graphite supply-demand balance has been updated based on our upwardly revised expectations for growth from the electric vehicle (EV) battery sector. Our forecasts for EV battery production indicate demand for graphite from the battery sector will rise by 35.93% to approximately 594,000 tonnes in 2022 from around 437,000 tonnes...

[moonshot3] 08/2/2022 17:32

Congratulations on the fantastic results today and thanks for coming back to me on these points.

[divmad] 08/2/2022 10:08

Excellent post. You should be employed by BRES in PR.

[apfindley] 08/2/2022 09:08

The information you witter for, is in this latest rns.You must be very happy now. Questions answered, and an outstanding update.

[pauliewonder] 08/2/2022 07:50

Another amazing RNS. MR and CP are doing an amazing job. share price hasn't yet reflected this but it will. We clearly have a monster on our hands in Orom-Cross

[soulsauce] 08/2/2022 07:32

More very good news. Looking forward to the reserve upgrade.

[apfindley] 07/2/2022 18:25

Moonshot..You will be excited to learn that the part of the license area drilled and jorc reported so far, only represents less than 1 % of the license.If we could multiply the numbers by 100 would you be happier.

[divmad] 07/2/2022 16:59

Moonshot,

Re your first point:

THE JORC RESOURCE OF 16.3mt IS A BIT MISLEADING AS THAT IS AN INFERRED
RESOURCE, WHICH CANNOT BE USED FOR MINE PLANNING/DESIGN - ONE NEEDS TO
FURTHER INFILL DRILL THAT TO GET TO INDICATED & MEANSURED TO INCLUDE THOSE
TONNES INTO THE PFS, WHICH IS WHAT I BELIEVE THEY HAVE NOW DONE.

[divmad] 07/2/2022 14:44

Moonshot, the revised JORC will, I believe, satisfy you on point 1, elevating the resource to measured and indicated. All the other points are covered in their own presentation on their website.

[soulsauce] 07/2/2022 14:39

moonshot of course it's speculative and that's why it is £7m mkt cap and not £70m.
You maybe paying for a company valued at more than that if you want most of those boxes ticking.

Pilot production next year.

[moonshot3] 07/2/2022 14:14

That is helpful, thank you, Divmad. I am thinking that an investment now would be highly speculative because there are uncertainties over the following :

1. Quantity of resource - only indicated and measured?
2. Quality of graphite - met testing still to be undertaken?
3. Off take (will there be any interested buyers?) - can't be sold in the market?
4. Suitability for ion lithium batteries? (business plan shows 65% target sales)
5. Will future global supply increase to meet demand and keep graphite price down?
6. Financing of the mine - is mine going to be economic and can it be obtained?
7. Safety issues - transportation to Mombassa (Kenya)- 24 hours by lorry
8. Will battery technology change so that graphite no longer required?
9. Synthetic graphite seems to be superior to natural graphite for batteries?
10. Production not expected to start until 2025?

Happy for you to convince me otherwise!

[divmad] 07/2/2022 10:41

moonshot3,

Answers to your questions:

1. IN ORDER TO DELIVER 70ktpa BRES ESTIMATED THEY WOULD NEED 1.25mtpa ORE AT 6% GRADE AND 90% RECOVERIES. THIS MEANS 12.5mt FOR FIRST 10 YEARS LIFE OF MINE. THEY SET OUT TO DELIVER AN INDICATED & MEASURED JORC RESOURCE OF AT LEAST 12.5mt IN THIS LATEST PROGRAM OF DRILLING.

2. THE 6-7% GRADE FOR THE NORTHERN SYNCLINE AND 8-12% GRADE FOR CAMP LODE
ARE BOTH IN-SITU GRADES, WHICH MEANS THE NATURAL GRADE OF THE GRAPHITE IN
THE GROUND TODAY. ONCE THEY MINE IT AND PROCESS THE ORE THROUGH THE PLANT THEY
WILL DELIVER A GRAPHITE CONCENTRATE WHICH WILL HAVE 97% TGC (TOTAL GRAPHITE
CONTENT) WHICH IS WHAT THE BUYERS WILL WANT TO ACQUIRE.

3. Is the very high TGC at Orom-Cross indicative of a graphite "lump"
deposit, rather than an amorphous deposit, and therefore much cheaper to
mine? OROM CROSS IS A FLAKE GRAPHITE DEPOSIT. IT WILL BE CHEAPER TO MINE
BECAUSE (1) IT IS NEAR SURFACE (THEY WILL MINE IT FROM 0-30m) SO LOW STRIP
RATIO FOR OPEN CUT MINING, (2) IT IS FREE DIG SO NO DRILL AND BLAST
REQUIRED, AND (3) LABOUR COSTS IN UGANDA ARE CHEAPER THAN OTHER PARTS OF THE
WORLD.

Hope this helps.

[moonshot3] 05/2/2022 15:38

Apologies for my ignorance (new to this graphite mining sector stuff) but can someone cast any light on the following:1. PEA suggests 70k tonnes per year and 13 year mine life. That is 70k x 13 = 910k tonnes. How does that reconcile to JORC resource of 16.8m tonnes?2. PEA refers to 97% - 98% TGC (total graphite content. Is this something different to the grade of graphite - Came Lode figures quote 8 -11%?

[pauliewonder] 02/2/2022 12:26

“We are doing further final met test work in Canada through SGS in Toronto, and those results will come through probably within the next 60 days, and they are a precursor to discussions with buyers in terms of taking samples and considering us for offtake.”

[snickerdog] 01/2/2022 15:57

Closing in on 1m volume now, those trades at 4.5 are buys but they are below advertised spread so look like sells. More volume means more interest, more on radar etc

[divmad] 01/2/2022 13:25

Better action today.

[pauliewonder] 01/2/2022 10:06

hxxps://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/threat-of-graphite-supply-shortage-looms-over-electric-vehicle-rollout-68335809
Threat of graphite supply shortage looms over electric vehicle rollout

Author Camille Erickson
Theme EnergyMetals
SNL Image

Canadian developer Nouveau Monde Graphite's Matawinie project near Montreal is pictured above. The planned graphite mine is expected to produce 42,000 tonnes of battery anode material starting in 2025.
Source: Nouveau Monde Graphite Inc.

Global reliance on China for graphite, a key ingredient in batteries, has emerged as a major obstacle to electric-vehicle makers' production schedules amid trade disputes and soaring demand.

U.S.-based battery and car companies have urged President Joe Biden to ease trade restrictions or risk impeding the administration's push to electrify transportation sectors, according to industry experts. Producers trying to break into the market for graphite, the largest component of lithium-ion batteries by volume, have begun building out new production facilities in the U.S. and Canada, but they are years away from production.

"The global anode supply chain is 100% reliant on China at some point within that chain," Shaun Verner, CEO and managing director of Australian graphite miner Syrah Resources Ltd., said in an interview. The company operates the Balama natural graphite mine in Mozambique and plans to build the first graphite processing facility in the U.S. "That heavy reliance on a single source ought to be quite concerning for [original equipment manufacturers]."

Graphite is an abundant mineral around the world and relatively cheap compared with other battery materials, but finding the right quality and type of graphite needed for batteries can be tricky. The global demand for EVs is expected to drive a massive increase in demand for graphite. The world could be short 80,000 tonnes of the mineral in 2022 as demand from the EV sector rapidly scales up, according to Benchmark Mineral Intelligence. Sales of passenger plug-in EVs are projected to hit 9.6 million units in 2022, according to an S&P Global Market Intelligence forecast published in December 2021.

Price and supply troubles ahead

The average value of natural flake graphite shot up 25% between May 2021 and December 2021, according to Suzanne Shaw, principal analyst and lead graphite expert at Wood Mackenzie. Benchmark Mineral Intelligence assessed the price of flake graphite at about $650 per tonne, up year over year from $540/t, according to its latest price report published Dec. 31, 2021. The price reporting agency has forecast the cost for this feedstock breaking $700/t in 2022. Meanwhile, the price for 15-micron spherical graphite was $2,800/t, decreasing slightly year over year from $2,825/t, according to the agency. Spherical graphite is battery grade and ranges in particle size from 10 microns to 25 microns.

The price rally will likely continue through early 2022 as the sheer scale of anticipated demand buoys prices. China's power rationing due to decreased coal supplies could also persist into the second quarter of 2022. The country primarily uses coal to provide energy, but it has been facing supply disruptions from an Indonesian export ban and a prolonged trade dispute with Australia.

"The graphite market is tightening, especially for grades that are suitable for use in batteries as demand rises robustly," Shaw told Market Intelligence in an email. "In the short term, there is room for Chinese producers to further increase production to meet capacity and alleviate some of the gap, but we believe that a tightening market will increase prices in the coming years and encourage several new producers to come online outside China by the middle of the decade."

China touches almost all of the world's graphite along its path to the consumer. The U.S. imported 64,396 tonnes of refined graphite between January and November in 2021, of which 73.3% came from China, according to data from Panjiva, a supply chain-focused business line of Market Intelligence. Even when graphite is mined or manufactured outside of China, such as from Mozambique, it is typically routed to China for processing and refinement. And most graphite refined in places such as Japan comes from China.

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Trade squeeze

A tariff battle within the Biden administration has only exposed the battery industry's dependence on China for graphite. In 2018, U.S. trade officials slapped tariffs on several products associated with the EV supply chain coming from China, including artificial graphite. The Trump administration eventually allowed companies to apply for certain exclusions, but those exemption opportunities expired in 2021. In public comments, companies bemoaned the impossibility of getting graphite from anywhere but China.

"Tesla has concluded that no company in the United States is currently capable of producing artificial graphite to the required specifications and capacity needed for Tesla's production," California-based EV and battery giant Tesla Inc. said in comments filed with the Office of the U.S. Trade Representative and posted on Dec. 1, 2021. Tesla could not be reached for comment.

SK Battery America Inc., a subsidiary of South Korea battery-maker SK Innovation Co. Ltd., also supported the extension of the tariff exclusion on graphite, stating it was "unfeasible" to obtain graphite from the U.S. for use in the manufacturing associated with its $11.4 billion investment in lithium-ion factories in Kentucky and Tennessee in partnership with U.S. automaker Ford Motor Co. as well as its $2.54 billion investment to build battery plants in Georgia.

"Presently, it is not feasible for SK Battery America and BlueOvalSK to obtain graphite from other sources outside of China due to the uniqueness of the product, the incredible risk of entering the graphite industry, and the lack of suppliers that can meet our present needs," the company wrote in a comment to the U.S. Trade Representative.

The U.S. Trade Administration press office did not respond to multiple requests for comment on the status of the tariffs. Partners at law firm Arent Fox expect the government agency to announce whether the product exclusions will be reinstated in early 2022, according to a Jan. 13 report.

Onshoring graphite production

Syrah Resources revived its Balama graphite mine in Mozambique in early 2021 and plans to ship a portion of the graphite it extracts to its new Vidalia anode processing facility in Louisiana. The company plans to announce a final investment decision for the construction of Vidalia in January. The majority of the Balama graphite output will still flow to China for processing, but Verner said the company aims to gradually shift more volume to the Western hemisphere for processing.

"We chose the U.S. because we saw that the manufacturing footprint of electric vehicles and batteries was moving out of Asia," Verner said. "Manufacturers want their manufacturing base closer to their markets."

Canadian developer Nouveau Monde Graphite Inc. has plans to erect a battery anode manufacturing hub near Montreal in Quebec and has started construction on a natural graphite mine. The Matawinie mine is expected to produce 42,000 tonnes of battery anode material starting in 2025.

"We cannot rely on China to build it all for us, like in the past," said Eric Desaulniers, founder, president and CEO of Nouveau Monde Graphite. "We need to streamline permitting. We need to go back to exploration to find more deposits of all those minerals. And we need to build our own supply chain locally," Desaulniers added.

SNL Image

In early December 2021, Canadian company Northern Graphite Corp. agreed to purchase the Lac des Iles graphite mine in Quebec from Imerys SA, with plans to produce 15,000 tonnes of graphite concentrate over a three-year period. And Australian Securities Exchange-listed Novonix Ltd. is working to open up a synthetic graphite plant in Tennessee.

Tesla is seeking to diversify its own supply of the gray flaky mineral. On Dec. 23, 2021, weeks after Tesla's comments on the trade dispute, Syrah Resources announced it had signed an off-take agreement to supply 8,000 tonnes of graphite for four years from the facility starting no later than May 2024.

Yet the question remains if companies with new graphite assets in the pipeline will be able to meet the speed of EV demand.

"Supply will struggle to catch up with graphite demand," said George Miller, a Benchmark Mineral Intelligence analyst.

[pauliewonder] 01/2/2022 09:36

See the problem here is not that it is not an exceptional opportunity from a shareholder value perdpective, but rather that it is so under the radar of investors. This is demonstrated by the fact that there have been zero trades so far today and we are 90 minutes into the trading day.

[snickerdog] 31/1/2022 19:27

Plus retail buying in the early fours. Apparently placed out to all sticky existing guys but always one or two who play by their own rules

[apfindley] 31/1/2022 16:04

Yes it's funny considering this has an important and valuable resource ...then you compare it to rubbish like syme or aaa which gets pumped to silly silly valuations without any assets.