Zenyatta in Canada is up on Graphite in Lanka
Bora Bora resources is up 80% in 6 months due to the acquisition of Plumbage Lanka. Bora Bora will spend 50 million LKR to buy Plumbage Lanka
Bora Bora told shareholders that it had reached an agreement to acquire a 75% interest in a suite of tenements surrounding one of the world’s oldest producing, and highest-grade vein graphite mines.
“We are very excited by the acquisition and its high-grade nature, which is not comparable to any other region in the world,” said Bora Bora chairperson Patrick Ford.
“This acquisition supports the company’s strategy to acquire high-quality projects that have the potential to build significant value for shareholders.”
Bora Bora would acquire 100% of the issued capital of Plumbago Mining, which, in turn, holds a 75% shareholding in Plumbago Laka. Plumbago Laka holds the tenements surrounding the producing Kahatagaha Kolongaha mine, which has been in production since 1872, and produces some 300 000 t of graphite.
In exchange, Bora Bora would make a cash deposit of A$100 000, payable to the vendor of Plumbago Mining, as well as an additional A$400 000 on the completion of the acquisition.
4th March 2013
TORONTO – Zenyatta Ventures, the top performing mining issuer on TSX Venture Exchange in 2012, is banking on a rare type of natural graphite that it says can compete on a quality level with synthetic graphite, while costing much cheaper to produce.
The Thunder Bay, Ontario-based company is in the very early stages of developing its Albany project in northern Ontario, a vein-type graphite deposit. Vein graphite, also known as lump graphite, is currently only produced in Sri Lanka.
The unique nature of the project has already captured the market's attention. Zenyatta's stock quintupled in value from 14.5 Canadian cents to 79 Canadian cents in 2012. In that same period, the broader S&P/TSX Venture Composite Index fell more than 17%.
Extending its bull run, the stock has nearly tripled in value so far this year to close at C$2.14 on Friday.
"People recognise, even in a bad market, that certain things look amazingly good," CE Aubrey Eveleigh told Reuters ahead of the Prospectors and Developers Association of Canada convention, which started on Sunday. "What we pulled out here was extremely rare. The last time one of these was found was probably 200 years ago. People recognise that."
Graphite has gained popular attention in recent years mainly due to the development of graphene, the world's strongest and thinnest material, and for its use in advanced lithium-ion batteries to power tablets, smartphones and hybrid vehicles.
While the technology applications get the most attention, graphite - which is highly conductive and can withstand intense heat - is primarily used in steelmaking and metal work.
There are three basic types of natural graphite - amorphous, flake and vein. Amorphous graphite is the lowest quality and most abundant, while vein type is the rarest and most valuable.
Synthetic graphite, a man-made material prized for its consistency and quality, is the most valuable, though it is expensive to produce.
Zenyatta says that because its ore is naturally "cleaner" than most deposits, it can produce 99.96% pure graphite through a single crush and floatation circuit, followed by a relatively short leaching process. So far, the company has only proven the process on a bench scale.
While he would not give exact numbers on costs, Eveleigh said that because the refining process is so simple, Zenyatta can produce create high-purity graphite for just a fraction of the cost of synthetic graphite.
Synthetic costs around $4 000/t to $5 000/t to produce and sells for around $7 000/t to $9 000/t, while ultra high-purity graphite can sell for $20 000/t, the company said.
Zenyatta expects to be able to produce around 100 000 t of high-purity graphite a year from its Albany project, which is in some 1 000 km north-west of Toronto.
That is well above Sri Lanka's annual output of some 4 000 t a year. To be sure, Zenyatta is still in the early days of development work, with its first resource estimate expected in September and a prefeasibility study due in early 2014.
The Zenyatta team discovered the graphite deposit by accident while surveying for copper and nickel. At first the company wasn't sure what it had found.
"We thought it was massive sulphides - copper nickel. We drilled into it, pulled out the core and I didn't know what it was," said Eveleigh. "I've been in the business for 30 years and I'd never seen anything like it."
They ended taking samples to a local university where it was tested using a powerful electron microscope and eventually identified as hydro-thermal, or vein, graphite.
With demand steadily rising, a swath of junior mining companies have popped up in recent years, with most promoting flake graphite deposits in Canada and around the world.
Zenyatta says it is unique in that its project is the largest, and only new, vein-type graphite deposit in the world.
"If there's 100 companies out there with graphite projects right now, 99 of them have flake and there's one with hydro-thermal or vein type," said Eveleigh.
With some C$5.5-million in cash on hand, and another C$7-million expected from outstanding warrants, Eveleigh said the company has all the funds it needs to get through to a production decision.
Having proven its process on the bench scale, the next step is to ramp up to a pilot plant study, and provide potential customers with sample material. Zenyatta is also completing drill work on its deposit.
The plan is to build an openpit mine, with the option of eventually going underground. Because the deposit is near existing infrastructure, Zenyatta expects capital costs to be around $150-million, in line with other graphite projects.
While a construction decision is still at least a couple of years away, the company is already considering the merits of a strategic partnership, or a deal with an end user.
"We're been approached by many end users globally - out of Europe, out of Asia, out of the US," said Eveleigh. "These things could materialise into a strategic partner or buyout. If not, there's enough value here - I don't think we'll have any issues raising money to put it into production."
Cliffs Natural Resources holds a 12.75% stake in Zenyatta, according to Thomson Reuters data.