Northern Graphite set to pause operations at Lac des Iles
Northern Graphite Corp. [NGC-TSXV; NGPHF-OTCQB] said it plans to pause operations at its Lac des Iles (LDI) processing facility in order to complete repairs and maintenance and enable the mill to increase throughput to meet growing demand for natural graphite sourced outside China.
The shutdown will begin on November 2, 2024\, with production estimated to resume on January 6, 2025. The company said it will seek to mitigate any disruptions by supplying customers from existing inventories and from third parties.
Northern Graphite shares eased 4.5% or $0.005 to 10.5 cents. The shares trade in a 52-week range of 36 cents and $0.045.
“In order to ensure increased, stable production in 2025 and beyond that can keep up with the rising market demand, we have decided to move forward the time frame for a maintenance and repair shutdown,’’ said Northern Graphite CEO Hugues Jacquemin. “Lac des Iles has the potential to produce more and for longer than anticipated when we acquired the mine in 2022, and we need to prepare as we look to open a new pit and increase throughput at the mill.’’
The company said growing output from the cornerstone LDI mine is critical to its strategy as it works toward becoming a vertically integrated, mine to market supplier to traditional downstream customers and to the emerging market for battery anode material (BAM) as well as the next generation of solid-state battery chemistries. The company moved the LDI plant to a seven-day-a-week schedule in April of this year, boosting output by 59% over subsequent months, and plans to increase output further after the plan reopens in January.
The company’s mining division is currently running operational scenarios to open a new pit after a successful 2023 drilling campaign and a new resource estimate showed potential to significantly extend the mine life of LDI. The company is also planning a second drilling program with the goal of further expanding resources to increase production.
Earlier this month, the company announced a joint development agreement with Rain Carbon Inc. to develop advanced natural graphite anode material to improve performance and reduce the costs and carbon footprint of lithium-ion batteries in electric vehicles.
“We are putting the pieces in place to be ready when markets improve to supply North American battery markets with BAM processed from our graphite, tailored to their needs and close to their end of the market,’’ Jacquemin said.
The company reported second quarter revenue of $5.5 million based on 2,772 tonnes of graphite concentrate sold at an average realized sales price of $1,972 per tonne (US$1,441 per tonne), 6.0% above the first quarter, due to a favourable product mix.
Aside from LDI, the company also owns the large-scale Bissett Creek project in Ontario and the fully-permitted Okanjande graphite mine in Namibia, which is currently on care and maintenance and represents an opportunity to substantially increase graphite production at a lower cost and with a shorter time to market than most competing projects.