Mason Graphite (TSXV: LLG; US-OTC; MGPHF) reports that testing of lithium-ion batteries containing graphite in the Lac Gueret project, which is 100% owned by Quebec, 660 kilometers north of Montreal, has reached the key to potential electric vehicles milestone. Vehicle applications.

Lithium-ion batteries contain anodes made of coated spherical graphite (SPG) made from graphite flake concentrate mined at Lac Gueret, achieving 500 charge/discharge cycles while maintaining 85% of the battery’s original capacity, increasing The industry minimum requirement is 80%.

Jean L'Heureux, COO of Mason Graphite, said in an interview: "This is the culmination of five years of hard work. Our products have credibility in the market." "The goal of 500 cycles is considered an important part of the battery industry. Milestone, we can also prove that it is repeatable."

During the battery charge cycle, SPG acts as a host for lithium ions. Lithium ions migrate through the electrolyte from the cathode (usually made of lithium metal oxide) to the anode, where they attract electrons from the external circuit and are stored in the anode as lithium. Graphite structure.

On the contrary, during discharge, lithium ions are released from the anode because they release electrons to the external circuit, move to the cathode, and are stored again in the form of lithium.

"This is the culmination of five years of hard work, and finally obtained a product with a reputation in the market"

In order to produce SPG particles for battery anodes, graphite flakes must first be reduced to a size of about 40 microns, and then rounded to produce SPG particles between 5 and 20 microns. The micronized spherical graphite structure resembles a clenched fist and is then purified using sulfuric acid. 

"The higher the purity of the SPG, the better it can store maximum energy and maintain the reversible capacity of the battery," said Henri Wilhelm, the company's advanced applications and product expert. "The size and shape of the SPG particles are also important because the micron-sized round particles allow the formation of thin and dense anodes."

He said that the company has been able to produce SPG particles with a purity of 99.95% and an average particle size of 20 microns.

The final stage involves coating graphite with a carbonaceous precursor and baking it at temperatures exceeding 1,000 degrees Celsius. This produces a hard, thin carbon shell that "smooths" and reduces the surface area of ​​the particles, improving the battery's cycle efficiency and energy storage capacity . 

The coating can also prevent graphite from reacting with the battery's electrolyte, thereby reducing battery capacity and life.

Graphite was first discovered in Lac Gueret in 2001 by Exploration Esbec Inc., a mineral exploration and production company located in Sept-Iles, Quebec. The following year, Quinto Mining Corp. selected Exploration Esbec's series of claims, which now form the core of current assets.

Quinto conducted sporadic exploration of the property from 2002 to 2007, including trench and geological surveying, channel sampling, geophysical surveys, and drilling. However, there was very little work to develop the project.

In 2008, Quinto was acquired by Thompson Iron Mines, and in 2011, Cleveland-Cliffs (NYSE:CLF), then named Cliffs Natural Resources Inc., acquired Thompson.

Mason acquired the property from Cleveland Cliffs in 2012.

In the same year, the company completed the 163-hole intensification drilling plan, and then performed the first laboratory-scale enrichment process for the mineralized samples of the project.

From 2013 to 2014, Mason completed 13,418 meters of drilling operations on 86 holes.

Mason Graphite performed additional metallurgical work on core samples from 2014 to 2015, and conducted the first pilot test on bulk samples in 2014.

In 2015, Mason embarked on the “first transformation” through the development of mineral deposits and mine concentrators.

The detailed engineering work of the mine began in 2017, and the company purchased the main processing equipment of the Baie-Comeau concentrator located 285 kilometers south of Lac Gueret in 2018.

L'Heureux said that although 75% of the detailed engineering design work has been completed, it has been shelved due to the current oversupply of China's cheap graphite market.

But like many industry analysts, he is optimistic that as the use of energy storage technology increases and the demand for graphite exceeds the current supply, the price of graphite will rise in the next few years.

In 2018, the company issued an updated feasibility study (FS) that outlined an open-pit mine that would produce 51,900 tons of graphite concentrate per year over a 25-year mine life.

The study puts the cost of capital at 258.2 million Canadian dollars, and the payback period after tax is approximately four and a half years. During the entire life cycle of the mine, operating costs are estimated at 627.3 million Canadian dollars, and the average production cost per ton of graphite concentrate is 483.77 Canadian dollars.

The average price of graphite concentrate used by FS is US$1,933 per ton, and the estimated net present value after tax is 278 million Canadian dollars, the discount rate is 8%, and the after-tax return rate is 21.7%.

The study is based on the latest mineral resource estimates for the 65.5 million tons project, and shows that 11.2 million tons of graphite contain graphite at 17.2%. Inferred total resources are 17.6 million tons, graphite grade is 17.3%, and graphite is 3 million tons.

"The high production level of ore means low production and operating costs," L'Heureux said. "Even at the current market price, the project will be profitable, but it is not yet enough to attract investors."

He said that unfavorable market conditions had a direct impact on the company's stock price, making it very difficult to develop mines and concentrators without significant dilution. 

Before the graphite market picks up, the company is focusing on the "second transformation" in the process, using graphite purchased from the market to develop value-added products for a range of applications, including insulation, carbon brushes, brake pads and clutch automotive finishes , Flame retardants, paints and lubricants.

"We are continuing to optimize the coating process to further increase production, improve product quality, and adapt the process to uncoated spherical graphite from external graphite sources," he said.

(This article was first published in "Northern Miners")