Pavbar75, while a good post I think you’ve also forgotten the...

Pavbar75, while a good post I think you’ve also forgotten the importance of the exclusivity clause KNL has worked into contracts with their service providers/engineers. It might not matter what GRK find, they wont be able to get the expertise to even consider the resource, let alone develop the project until they expire. That is unless they import said expertise, but that’ll add considerably to the costs.

I’ll wager they’ll request a take-over in a few years too. They’re too far behind and with some local service providers locked up, I’m not really sure what they can do beyond drilling.

Ryphil, there are no Chinese companies even close to being equal to the US/EU/Japanese understanding on graphite. The material is classified as “critical” to each of the four and they don’t cross develop or share expertise for this reason.

Spherical graphite was developed in Germany, but the processing has been leased to Chinese companies for years. Chinese companies are famous for reverse engineering technology, sometimes blatantly ignoring patients. Most of the intriguing work in graphite/graphene is being done away from prying eyes and sticky fingers. A new refining process has also been developed for spherical graphite in Germany and the rumour is, it’s not leaving the country.

The Chinese understanding of battery/ESD technology is regarded as being well behind the pack. Just FYI, EV’s require up to 70kg’s of unrefined, high grade, large flake graphite for each battery. Synthetic spherical graphite is anywhere from 3-5 times more expensive than natural graphite. (ESD’s thread http://hotcopper.com.au/threads/energy-storage-devices-the-real-driver-behind-graphite’s-potential.2349941/?post_id=13902512#.VE3hNiwcTIU)

I also think it’s worth highlighting that graphite is different, in every place. The purity, flake size etc. all varies. In essence it means ThyssenKrupp aren’t signing a 10 year off-take, but will take the product for the life of the mine. They have to re-tool machines to the specific properties of each deposit and they can’t just walk away. That’s why every contract is a minimum of 10 years, the expense to re-tool is too great. ThyssenKrupp will be on the KNL register for as long as they’re producing graphite (and with only 20% drilled for a 27 year life you quickly realise how profitable this might be, possibly a 100-135 year mine).

But you do touch on a nice titbit that backs up my SGL theory. Right now SGL has a JV with BMW to develop the i3, BMW’s own EV. There are few companies with the clout/expertise to guarantee an off-take, but SGL being the EGT and on selling into the JV not only explains the “except Germany” clause, but they’re one of the few companies large/sophisticated enough to execute such a contract. (SGL theories thread http://hotcopper.com.au/threads/cou....2357939/page-5?post_id=13962213#.VE3gyiwcTIU)