big north graphite : presenting at global online ceo conference small stocks big money
DESCRIPTION
Big North is a graphite development and exploration company with projects in Mexico and Canada Owns three past producing amorphous graphite mines in Sonora, Mexico Currently test mining at the Nuevo San Pedro amorphous graphite mine. Owns high quality large-flake graphite exploration target in OntarioTRANSCRIPT
1 TSX – V NRT
Discovering Graphite Opportunities in Mexico & Canada
June 2014
Cautionary Note Forward-‐looking statements Certain statements contained herein cons/tute “forward-‐looking statements.” Forward-‐looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-‐looking statements may include words such as “plans,” “intends,” an/cipates,” “should,” “es/mates,” “expects,” “believes,” “indicates,” “targe/ng,” “suggests,” “poten/al,” and similar expressions. These forward-‐looking statements are based on current expecta/ons and entail various risks and uncertain/es. Actual results may materially differ from expecta/ons, if known and unknown risks or uncertain/es affect our business, or if our es/mates or assump/ons prove inaccurate. Investors are advised to review the Company’s Annual Informa/on Form filed at www.sedar.com for a detailed discussion of investment risks. The Company assumes no obliga/on to update or revise any forward-‐looking statement, whether as a result of new informa/on, future events or any other reason. While Big North intends to re-‐start the Nuevo San Pedro mine, the Company has not established mineral resources and has not completed a valid mining study (as defined by NI 43-‐101) to support a produc/on decision. Historically, a produc/on decision under these circumstances results in much higher economic or technical risk. Furthermore, without a pre-‐ feasibility or feasibility study and a graphite reserve, there can be no assurance that opera/ons at Nuevo San Pedro will be profitable. 2
Management & Directors v Spiro Kletas, President & CEO, Director – Over 10 years experience in the financial industry with 7 years in the public capital
markets, working for several Toronto Exchange-‐listed companies in project procurement, corporate development and financing.
v Daniel Bleak, Chairman– Mr. Bleak has over 30 years of experience in mineral exploraJon and has developed and managed a broad range of exploraJon projects throughout North America and Mexico. He has been instrumental in the discovery of several producing mineral deposits and has developed decoraJve rock and industrial materials businesses in the Southwest United States and Mexico.
v Cesar J Guajardo, Director -‐ Mr. Guajardo has 18 years of experience in graphite. He was the former owner and Chairman of the Board of Grafito de Mexico SA de CV, a private company and the former owner of the El Tejon Flake Graphite Mine and Mill in Oaxaca, Mexico. Mr. Guajardo is a graduate of the Universidad de Nuevo Leon, and holds a degree in Industrial Engineering. Mr. Guajardo spent 22 years with Praxair Mexico and was the former Managing Director of Praxair Mexico for ten years.
v Andrew Rees, Director – Mr. Rees is currently President and CEO of WellStar Energy Corp. and sits on the board of directors of several publicly trading companies. Mr. Rees brings 15 years of public company experience having been involved with developing projects from concept to producJon. Mr. Rees has been directly involved in raising over $150 million for junior resource companies.
v Eric Ostensoe P. Geo., Director -‐ Mr. Ostensoe is a consulJng geologist with more than forty years direct involvement with the mining and mineral exploraJon industries. Mr. Ostensoe supervises property exploraJon and development projects from "grassroots" to advanced stages and provides recommendaJons to management of junior and medium sized public companies.
v Connie Norman, Corp Secretary
3
Capital Structure
• Issued & Outstanding 73.4 m
• Warrants 41.5 m • OpJons 3.2 m
• Fully Diluted 118.1 million
4
Investment Highlights • Currently SELLING amorphous graphite in Sonora Mexico – 1163 tons sold to date
• Amorphous graphite accounts for approx 50% of natural graphite market and over 90% of producJon was out of China in 2012 – Big North is only TSX.V company pursuing amorphous graphite
• Recently acquired the El Tejon Flake graphite mine and mill in Oaxaca, Mexico
• Goal of near term FLAKE graphite producJon
5
El Tejon Flake Graphite Mine
6
El Tejon Flake Graphite Mine and Mill
7
• Acquired Feb 2014 • Mexico’s only past producing flake graphite mine and floataJon mill • Closed due to graphite prices in 2002 • Ability to jump start – all infrastructure in place • Produces flake graphite (different uses than amorphous graphite)
• Cesar J Guajardo, Chairman of former Private Co that operated El Tejon, named to Board of Big North • 18 years of graphite experience in Mexico
El Tejon Flake Graphite Mine and Mill
• 500 hectare property -‐ consists of the El Tejon flake graphite mine and mill • The El Tejon Property is located in the state of Oaxaca, approx 38
kilometers Northwest of the City of Oaxaca, in the town of San Francisco Telixtlahuaca.
• The El Tejon Property is the only flake graphite mine to have produced in Mexico.
• The mine and mill were originally built in 1980 by the Government of Mexico. In 1989, a second processing line was installed to increase the capacity.
• El Tejon was an open pit mine, and the mill was used to crush, mill, float, dry, screen and pack final product.
• Closed in 2002, due to low graphite prices. At the Jme of closing, approximately 80% of the graphite produced was sold to the USA.
• Historically, the mine produced approximately 20% large flake graphite and 80% medium and fine flake graphite.
8
Tesla and Graphite
“$5bn ‘gigafactory’ to spark EV uptake; baQery graphite demand could double in 6 years with no growth elsewhere”
“US automoJve giant, Tesla, has revealed plans to build a new $5bn lithium-‐ion bamery (Li-‐ion bamery) ‘gigafactory’ which could potenJally increase natural graphite demand by up to 37% by 2020. The factory, which is forecast to start producJon by 2017, is expecJng to have an output of 35 gWh/year by as early as 2020, which would over double the size of the current market. Its important to stress that the plant is in the planning stage and capaciJes depend strongly on market demand, but Tesla believes it can be the market leader by producing low cost bameries in the USA. In IM Data's calculaJons, Tesla's plant -‐ which is set to be based in the south-‐west USA -‐ will consume at least 28,000 tonnes of spherical graphite every year if operaJng at capacity. This equates to 93,000 tonnes of flake graphite if produced to today's standards which sees raw material wastage of up to 70%.”
-‐ Industrial Minerals esJmates 6 new graphite mines needed to feed Tesla’s plant -‐ Bloomberg reported that Tesla plans to use materials sourced from North America only -‐ 93K t of flake graphite required – a 37% increase in natural graphite demand
* Source: Industrial Minerals 9
Sonora Mexico Properties • Big North acquired 3 past producing graphite mines in Sonora, Mexico -‐
La Fortuna, Caraples and a 50/50 JV in the Nuevo San Pedro Graphite mine. • Nuevo San Pedro mine in the process of being re-‐started: Big North Graphite to
accelerate the start-‐up process.* • Started assembly of processing facility April 2013 • Started test mining May 2013 • First sale completed Aug 2013
• Approx. 10 km East of a rail line with direct access to the port of Guaymas • Area of good infrastructure and access • Sonora Mexico has produced graphite for over 100 years • Approx. 50 km SE of Hermosillo, a city of 1 million people • Nuevo San Pedro is approx 1km away from the La Lourdes graphite mine, which has been operaJng for over 50 years
10
Sonora Mexico Property Map
11
• Nuevo San Pedro is an approximately 11 hectare property. It is a past producing mine, which is in the process of being restarted.
• Aki Wiki consists of approximately 145 hectares.
• Aki Wiki is located approximately 1.5 kilometers south of the historic El Cochi graphite mine. There are two past producing mines on the property, La Fortuna and Caraples.
Buying and Processing
April 22, 2013 NR: Big North … announces that, as part of the Company's business plan, the Company has
started buying amorphous graphite from local private producers who do not have processing capabiliJes. Big
North has recently acquired approx 100 tons of amorphous graphite in an unprocessed form from two local
miners. Big North plans to purchase graphite from local producers to supplement potenJal producJon from the
Nuevo San Pedro project. The Company plans to process the purchased graphite to the specificaJons of future
customers and re-‐sell the purchased graphite at market prices, capturing the difference in prices.
ü Increase “producJon” without the tradiJonal risks of mining
ü Many small family run graphite mines without processing ability
ü Minimum grade requirement
ü Capture the difference on pricing, minus processing and transport
12
Amorphous Graphite • Global graphite producJon was 1.1 million tons in 2012, approx 50% of which is amorphous
graphite. • The United States, Europe and China have included graphite among the short list of criJcal
metals • The UnJed States produces no graphite and is 100% dependent on imports to meet it's
industrial and technology needs. • China produces 70%-‐80% of the world’s natural graphite. China produced over 90% of
world’s amorphous graphite in 2012. • “Supply security is a big concern” for amorphous graphite users • ConJnuing government-‐backed consolidaJon programs in the Hunan Province is seeing over
230 mines reduced to 20 • Amorphous graphite sells for $350-‐800/ton depending on the carbon content which ranges
from 65% to 85%+ • Amorphous graphite producJon is dominated by China, with approx 16K tpa from Austria,
12K tpa from Mexico and 300 tpa from Turkey • Amorphous graphite is mainly used as a component in lubricants, refractories, steel
producJon, brake linings, clutch materials, gaskets and water-‐based paints *Source: Industrial Minerals
13
Amorphous Graphite Stockpiles
14
Graphite Stockpiles at Big North Graphite’s Processing Plant, Sonora Mexico
Griffith/Brougham Graphite Properties - Ontario
• Approximately 6,500-‐hectare land posiJon in central southeastern Ontario
• High value, high quality large-‐flake graphite exploraJon target
• In an area of well-‐established access and infrastructure
• ProperJes cover substanJal tracts of graphite-‐prospecJve Grenville-‐age marble +/-‐gneiss geology and are unexplored for graphite using modern technology.
• To the southeast, the Brougham Graphite Property is anchored by two historic graphite occurrences (based on Ontario Geological Survey maps from the 1970's)
• EM survey completed July 2012
• NI43-‐101Technical Report released Oct 2012
15
Grand Lac du Nord Property - Quebec • Approximately 2,009 hectare land package • Located approximately 140 km NW of Sept-‐Iles, by road • 8km x 2km graphiJc paragneiss formaJon • Similar geology to other graphite deposits and mines in Quebec, such
as Focus Metals Inc.'s Lac Knife deposit, Timcal Graphite and Carbon's Lac des Iles mine.
• Originally explored by SOQUEM (2000/2001) • Phase 1 ExploraJon completed -‐ confirmed
a mulJple graphite bearing structure covering an area approximately 4 km by 2 km with results of up to 5.31% Graphite in grab samples
16
What is Graphite? • CriJcal supply industrial mineral • One of two natural carbon polymers (diamonds) • Light weight with highest natural
strength and sJffness of any material • Conductor of heat/electricity • Corrosion and heat resistant • High natural lubricity
17
Amorphous Graphite + Uses • Amorphous graphite is actually not “amorphous” as all graphite is crystalline.
It is microcrystalline or cryptocrystalline, meaning that the “flake” size is very small.
• Amorphous graphite is used in the refractories industry to manufacture crucibles, ladles, molds, nozzles and troughs that can withstand the very high temperatures associated with molten metal, parJcularly the casJng of steel.
• The electrodes used in many electrical metallurgical furnaces, including the electric arc furnaces used in steel processing, are manufactured from graphite. In the producJon of steel itself, graphite is used as a carbon raiser to strengthen steel. It is also used in blast furnace linings for the producJon of iron because of its high thermal conducJvity.
• Amorphous or fine-‐flake graphite is used in brake linings, gaskets and clutch materials.
• Foundry facing mold wash uses amorphous or fine-‐flake graphite in a water-‐based paint to coat the mold, thereby allowing ease of separaJon of the casted object from the mold awer the metal has cooled.
18
Graphite Major End Uses
41%
14%
14%
11%
10%
10% Steel & Refractories
AutomoJve parts
Lubricants
Carbon Brushes
Bameries
Other
Source: Merchant Research & ConsulJng (2011) 19
Graphite Comparables
0 50 100 150 200
Big North -‐ $3.4m
Graphite One -‐ $22.9m
Flinders -‐ $31.4m
Northern -‐ $36.3m
Mason -‐ $40.8m
Focus -‐ $55.7m
Zenyama -‐ $182.3m
Market Cap ($m)
20
Supply/Demand Dynamics • Industrial demand growing 5% per annum over last 10 years due to
industrializaJon of emerging economies such as China and India • European Union and USA named graphite a mineral in criJcal supply • Lack of exploraJon and development over last 20 years and China
producing +70% of the world’s graphite • Chinese producJon and exports expected to decline due to China’s
strategy to keep value added manufacturing in the country • Graphite market is more than 40 Jmes larger than lithium and rare
earths markets • Demand for graphite increasing globally for green technology
applicaJons which have potenJal to consume more graphite than all current uses combined
Source: Industrial Minerals, Supply Situa*on Report: Graphite demand soars above pre-‐crisis Levels, April 2011 21
Graphite Global Demand
Source: Industrial Minerals Magazine 22
Key Milestones ü Acquired First graphite asset -‐ March 2012 ü Commence ExploraJon on Canadian properJes -‐ May/June 2012 ü AcquisiJon of past producing Assets in Mexico -‐ Sept 2012 ü Close acquisiJon of Mexico properJes – Nov 2012 ü Start assembly of processing plant ü Accelerate re-‐start of Nuevo San Pedro Mine ü Commence test mining of amorphous graphite in Mexico ü Amorphous graphite sales q Increase producJon, enhancing processing, growing sales and securing long-‐term
oyake partners of amorphous graphite q Move El Tejon project towards producJon – Secure oyakes, refurb mill, start
permizng process
23
Contact Info:
Spiro Kletas, President & CEO [email protected] [email protected]
www.bignorthgraphite.com
Big North Graphite Corp.
Suite 350 -‐ 885 Dunsmuir Street Vancouver, BC
V6C 1N5 604.629.8220 (Office)
24