“Magnis Nachu total resource is 174Mt @ 5.4% grade (3% grade...

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Mucha123

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02/03/23

09:29

Post #: 66553628
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Originally posted by jdpc35: ↑

@ Evergrayeful.

It is probably worth adding to this post. In graphite (as with all mineral deposits) it is not just about size of deposit - you can have the largest deposit of something in the world, but if it is the wrong grade, high impurities, etc, it's economics can be challenged.

In this instance (and I am sourcing this data from a variety of sources):

Magnis Nachu total resource is 174Mt @ 5.4% grade (3% grade cut-off) for 3.6Mt contained graphite so far. They have not drilled out the total resource area.
It is a premium product resource - unique crystalline structure with low impurities that allow for product concentrate purity levels up to 99.6%.
An interesting feature is the product mix potential. We are all focused on the battery side of things - in fact only about 55% of the Nachu graphite (Large Flake = <300 microns, -50 mesh) would go into Li-ion batteries (ie to the AAM). 10% goes into ultra high-end uses such as Aerospace and composites (Super Jumbo Flake = 500+ microns / +35 mesh) and a further 35% goes into electronics (Jumbo Flake = 300-500 microns / +50 to -35 mesh). I suspect that the Traxis offtake will be focused on those high-end markets and the balance into the AAM.
This little table is from a now very dated Paydirt report (published in 2015 - so ignore the very dated Price per tonne figures), but it succinctly defines different product types and the relativities in pricing:
If I can use Syrah as a comparison, their Balma resource is very large (107Mt @ 16% = 16.9Mt contained graphite). Their product is refined to a 94% to 98% concentrate with 80% as Fine Flakes (-100 mesh). So, they have a very large deposit producing mostly the lowest grade (Fine Flakes) product.
Not sure of current pricing relativities, but from the dated price information in the above table, every tonne of Nachu product is worth more than 3X a tonne of Syrah Balma product!!
The Syrah AAM is to produce 18-micron and 12-micron coated purified spherical graphite.
The Magnis AAM is to produce an average product size of 22-micron coated purified spherical graphite.
On my read, Syrah really needed their AAM deal to make their Balma operation financially sustainable over a cycle. The AAM deal for Magnis is quite different - it is more about maximising the value capture for the approx 55% of their Nachu production that will go into the Li-ion battery market.

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“Magnis Nachu total resource is 174Mt @ 5.4% grade (3% grade cut-off) for 3.6Mt contained graphite so far. They have not drilled out the total resource area.”

Anyone know how much of the licensed area has not been explored? In my understanding we’ve still got a lot of exploring to do in the special licensed zone.
MNS Price at posting: 37.0¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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