- Preliminary economic assessment of the Uatnan Mining
Project demonstrates attractive economics with an indicative
NPV of C$ 2,173 million for a
targeted production of approximately 500,000 tonnes of graphite
concentrate per annum over a 24-year life of mine, making it one of
the world's largest graphite projects in development.
MONTRÉAL, March 1,
2023 /CNW/ - Mason Graphite Inc. (TSXV : LLG)
(OTCQX : MGPHF) reports: Following the publishing of
results on January 10, 2023, Nouveau
Monde Graphite Inc. ("NMG" or the "Company") (NYSE:
NMG, TSX.V: NOU) has filed the preliminary economic
assessment ("PEA") for the Uatnan mining project (the "Uatnan
Mining Project") located in Québec, Canada, with the securities commissions and
regulatory authorities in Canada
and the U.S. The PEA, conducted by engineering firms BBA Inc.
("BBA") and GoldMinds Geoservices Inc. ("GMG") according to
National Instrument 43-101 Standards of Disclosure for Mineral
Projects ("NI 43-101"), was carried out in collaboration with Mason
Graphite Inc. ("Mason Graphite") (TSX.V: LLG, OTCQX: MGPHF) as the
Uatnan Mining Project leverages the Lac Guéret deposit wholly-owned
by Mason Graphite and subject to an investment
agreement and option and joint venture agreement with NMG.
The PEA shows strong economics for NMG's updated operational
parameters and production volumes targeting the production of
approximately 500,000 tonnes of graphite concentrate per annum over
a 24-year life of mine ("LOM"). The proposed Uatnan Mining Project
is currently one of the largest projected natural graphite
productions being developed in the world. Consistent with NMG's
vertical integration strategy, the Uatnan Mining Project's
contemplated production would serve as feedstock for battery
materials advanced manufacturing, providing refining expansion
opportunity, increasing potential margins, and enhancing the
Company's growth profile.
In today's dynamic market, the Uatnan Mining Project aligns with
NMG's commercial engagement amidst electric vehicle ("EV") adoption
reaching unprecedented levels with 10.3 million vehicles sold in
2022 (Rho Motion, February 2023).
With 7,940 GWh of global lithium-ion battery production capacity
projected by 2030, demand for advanced materials is set to increase
up to fivefold, with graphite outpacing the other battery metals
(Benchmark, January 2023) at
10,363,000 tonnes per annum for that market segment alone.
Arne H Frandsen, Chair of NMG, declared:
"The market is actively searching for alternative sources of
graphite, in significant volumes, to reduce its dependence on
Chinese-controlled supply chains. NMG's integrated operating model,
from ore to battery materials, caters to western world's EV and
battery manufacturers with a turnkey, scalable, and ESG-driven
production. The Uatnan Mining Project fits perfectly into the
Company's development plan, providing a large resource to
complement our Phase-2 Matawinie Mine and Bécancour Battery
Material Plant. Now more than ever, NMG is demonstrating its
leadership in striving to establish North
America's largest natural graphite production to serve the
energy transition."
PEA Results: The Potential of the
Uatnan Mining Project
NMG and its consultants revisited the fundamentals for the
property development with a view to aligning the Uatnan Mining
Project with today's market opportunity. Design of the Uatnan
Mining Project has been tailored to the needs of the battery and EV
market, orienting production volumes for beneficiation in order to
produce active anode material.
The Uatnan Mining Project optimizes the Mineral Resources (see
Table 2) and aims to expand the original mining project tenfold by
targeting the production of approximately 500,000 tonnes of
graphite concentrate per annum. It would be operated as a
conventional open pit with a concentrator near the deposit. In line
with NMG's responsible mining approach, plans include
considerations for high standards in term of tailings management,
progressive site closure with backfilling of the pit and a
transition to fleet electrification. Québec's affordable clean
hydropower underpins the Uatnan Mining Project's economic structure
and supports NMG's undeterred carbon-neutrality commitment.
Table 1: Operational Parameters of the Uatnan Mining
Project
OPERATIONAL
PARAMETERS
|
|
LOM
|
24 years
|
Nominal annual
processing rate
|
3.4 M tonnes
|
Stripping ratio
(LOM)
|
1.3:1
|
Average grade
(LOM)
|
17.5% Cg
|
Average graphite
recovery
|
85 %
|
Average annual graphite
concentrate production (LOM)
|
500,000
tonnes
|
Finished product
purity
|
94% Cg
|
Cautionary Note: Graphite is expressed in graphitic carbon
("Cg"). The PEA is preliminary in nature and includes Inferred
Mineral Resources, considered too speculative geologically to have
the economic considerations applied to them that would enable them
to be categorized as Mineral Reserves, and there is no certainty
that the PEA will be realized. Mineral resources that are not
mineral reserves have not demonstrated economic viability.
Additional trenching and/or drilling will be required to convert
inferred mineral resources to indicated or measured mineral
resources. There is no certainty that the resources development,
production, and economic forecasts on which this PEA is based will
be realized.
Table 2: Current Pit-Constrained Mineral Resource Estimate
IN-PIT CONSTRAINED
MINERAL RESOURCES
|
Tonnes
(Mt)
|
Grade (%
Cg)
|
Cg
(Mt)
|
Measured 5.75% < Cg
< 25%
|
15.65
|
15.2
|
2.38
|
Measured Cg >
25%
|
3.35
|
30.6
|
1.02
|
Total
Measured
|
19.02
|
17.9
|
3.40
|
Indicated 5.75% < Cg
< 25%
|
40.29
|
14.6
|
5.89
|
Indicated Cg >
25%
|
6.33
|
31.6
|
2.00
|
Total
Indicated
|
46.62
|
16.9
|
7.89
|
Indicated + Measured
5.75% < Cg < 25%
|
55.94
|
14.8
|
8.27
|
Indicated + Measured Cg
> 25%
|
9.70
|
31.2
|
3.03
|
Total Measured +
Indicated
|
65.64
|
17.2
|
11.30
|
Inferred 5.75% <
Cg < 25%
|
15.35
|
14.9
|
2.28
|
Inferred Cg >
25%
|
2.47
|
31.8
|
0.79
|
Total
Inferred
|
17.82
|
17.2
|
3.07
|
Notes :
- The Mineral Resources provided in this table were estimated by
M. Rachidi P.Geo., and C. Duplessis,
Eng., (QPs) of GoldMinds Geoservices Inc., using current Canadian
Institute of Mining, Metallurgy and Petroleum (CIM) Standards on
Mineral Resources and Reserves, Definitions and Guidelines.
- Mineral Resources which are not Mineral Reserves do not have
demonstrated economic viability. The estimate of Mineral Resources
may be materially affected by environmental, permitting, legal,
title, market or other relevant issues. The quantity and grade of
reported Inferred Mineral Resources are uncertain in nature and
there has not been sufficient work to define these Inferred Mineral
Resources as indicated or Measured Mineral Resources. There is no
certainty that any part of a Mineral Resource will ever be
converted into Mineral Reserves.
- The Mineral Resources presented here were estimated with a
block size of 3mE x 3mN x 3mZ. The blocks were interpolated from
equal-length composites (3 m) calculated from the
mineralized intervals.
- The Mineral Resource estimate was completed using the inverse
distance to the square methodology utilizing three runs. For run 1,
the number of composites was limited to ten with a maximum of two
composites from the same drillhole. For runs two and three the
number of composites was limited to ten with a maximum of one
composite from the same drillhole.
- The Measured Mineral Resources classified using a minimum of
four drillholes. Indicated resources classified using a minimum of
two drillholes. The Inferred Mineral Resources were classified by a
minimum of one drillholes.
- Tonnage estimates are based on a fixed density of
2.9 t/m3.
- A pit shell to constrain the Mineral Resources was developed
using the parameters presented in Table 4. The effective date of
the current Mineral Resources is January 10,
2023.
- Mineral Resources are stated at a cut-off grade of
5.75% C(g).
Estimates currently being at the market's peak as influenced by
inflationary trends, NMG and its consulting firms have refined
design, engineering, and construction parameters to enable cost
optimization and competitive pricing.
Table 3: Economic Highlights of the Uatnan Mining Project
ECONOMIC
HIGHLIGHTS
|
Uatnan Mining
Project
|
Pre-tax NPV (8%
discount rate)
|
C$ 3,613 M
|
After-tax NPV (8 %
discount rate)
|
C$ 2,173 M
|
Pre-tax IRR
|
32.6 %
|
After-tax
IRR
|
25.9 %
|
Pre-tax
payback
|
2.8 years
|
After-tax
payback
|
3.2 years
|
Initial
CAPEX
|
C$ 1,417 M
|
Sustaining
CAPEX
|
C$ 147 M
|
LOM OPEX
|
C$ 3,236 M
|
Annual OPEX
|
C$ 135 M
|
OPEX per tonne of
graphite concentrate
|
C$ 268/tonne
|
Concentrate selling
price
|
US$
1,100/tonne
|
Annual revenues from
Uatnan production
|
US$
550,000,000
|
All costs are in Canadian dollars with the exception of the
graphite sale price which is provided in US dollars.
The PEA shows that the Uatnan Mining Project is technically
feasible as well as economically viable. With natural flake
graphite expected to enter a structural deficit in 2023 due to the
continued growth of the lithium-ion battery sector (Benchmark
Mineral Intelligence, December 2022),
market perspectives and NMG's active commercial discussions
indicate favorable conditions for commercializing the Uatnan Mining
Project production.
On the basis of these positive results, NMG intends to launch an
updated feasibility study in compliance with the option and
joint venture agreement signed with Mason Graphite.
NMG is committed to extending its approach of open and proactive
engagement with Indigenous Peoples and local stakeholders to the
Uatnan Mining Project. The Company plans to maintain a transparent
dialogue with the Innu First Nation of Pessamit as it advances the
project development to ensure the respect of their rights, their
culture, way of life and spirituality, the inclusion of their
perspective and traditional knowledge, as well as the protection of
the environment. NMG also pledges to expand its relationships with
stakeholders from all horizons to foster mechanisms for
collaboration and shape a project generating shared value.
The PEA entitled "NI 43-101 Technical Report – PEA Report for
the Uatnan Mining Project", with an effective date of January 10, 2023, was filed on SEDAR
at www.sedar.com, on EDGAR at www.sec.gov and
on NMG's website. PEA results as outlined in this press
release were issued on January 10,
2023.
Scientific and technical information presented in this press
release was reviewed and approved by André Allaire, P.Eng. (BBA),
Jeffrey Cassoff, P.Eng. (BBA),
Vera Gella, P.Eng. (BBA),
Claude Duplessis (GoldMinds
Geoservices), and Merouane Rachidi,
P.Geo. (GoldMinds Geoservices) Qualified Persons as defined under
NI 43-101.
About Nouveau Monde Graphite
Nouveau Monde Graphite is striving to become a key contributor
to the sustainable energy revolution. The Company is working
towards developing a fully integrated source of carbon-neutral
battery anode material in Québec, Canada for the growing lithium-ion and fuel
cell markets. With low-cost operations and enviable ESG standards,
NMG aspires to become a strategic supplier to the world's leading
battery and automobile manufacturers, providing high-performing and
reliable advanced materials while promoting sustainability and
supply chain traceability. www.NMG.com
About Mason Graphite
Mason Graphite is a Canadian corporation focused on seeking
investment opportunities. Its strategy is to develop vertical and
horizontal integration in the mining industry, with a special focus
on industrial and specialty minerals, notably battery-related
materials and their by-products. Its strategy also includes the
development of value-added products, notably for green technologies
like transport electrification. The Company currently owns 100% of
the rights to the Lac Guéret deposit, one of the richest graphite
deposits in the world, which is under an Option and Joint Venture
Agreement with Nouveau Monde Graphite Inc. (TSX-V: NOU) (NYSE:
NMG). Mason Graphite is also the largest shareholder of Black Swan
Graphene Inc., a Canadian publicly traded company (TSX-V: SWAN)
(OTCQB: BSWGF) focusing on the large-scale production and
commercialization of patented high-performance and low-cost
graphene products aimed at several industrial sectors, including
concrete, polymers, Li-ion batteries and others.
Cautionary Statement Regarding Forward-Looking Information
Certain statements made in this news release are forward-looking
statements within the meaning of applicable securities laws,
including, but not limited to, statements with respect to the
timing of the Special Meeting, and other statements that are not
material facts. Often, but not always, forward-looking statements
can be identified by the use of forward-looking terminology such as
"may", "will", "expect", "believe", "estimate", "plan", "could",
"should", "would", "outlook", "forecast", "anticipate", "foresee",
"continue" or the negative of these terms or variations of them or
similar terminology.
Although the Company believes that the forward-looking
statements in this news release are based on information and
assumptions that are current, reasonable and complete, these
statements are by their nature subject to a number of factors that
could cause actual results to differ materially from management's
expectations and plans as set forth in such forward-looking
statements, including, without limitation, the following factors,
many of which are beyond the Company's control and the effects of
which can be difficult to predict: (i) the risks related to the
approval of the Proposed Transactions by the TSX Venture Exchange
and other risks related to the satisfaction of the conditions to
closing the Proposed Transactions, (ii) general risks related to
the completion of the Proposed Transactions, (iii) the risks
related to the formation of a joint venture, such as the Joint
Venture with Nouveau Monde, (iv) volatile stock price; (v) the
general global markets and economic conditions; (vi) the
possibility of write-downs and impairments; (vii) the risk
associated with exploration, development and operations of mineral
deposits; (viii) the risk associated with establishing title to
mineral properties and assets; (ix) the risks associated with
entering into joint ventures; * fluctuations in commodity prices;
(xi) the risks associated with uninsurable risks arising during the
course of exploration, development and production; (xii)
competition faced by the Joint Venture in securing experienced
personnel and financing; (xiii) access to adequate infrastructure
to support mining, processing, development and exploration
activities; (xiv) the risks associated with changes in the mining
regulatory regime governing the Joint Venture; (xv) the risks
associated with the various environmental regulations the Joint
Venture is subject to; (xvi) risks related to regulatory and
permitting delays; (xvii) risks related to potential conflicts of
interest; (xviii) the reliance on key personnel; (xix) liquidity
risks; (xx) the risk of potential dilution through the issuance of
common shares; (xxi) the companies do not anticipate declaring
dividends in the near term; (xxii) the risk of litigation; and
(xxiii) risk management. There can be no assurance that
forward-looking information will prove to be accurate.
Readers are cautioned not to place undue reliance on the
forward-looking statements and information contained in this news
release. Mason Graphite disclaims any obligation to update any
forward-looking statements contained herein, whether as a result of
new information, future events or otherwise, except as required by
law.
Additional Information
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
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SOURCE Mason Graphite Inc.