Jul 24 2014
Mason Graphite Inc. ("Mason Graphite" or "the Company") and Conseil des Innus de Pessamit are pleased to announce the signing of a cooperation agreement for the pre-construction phase of Mason Graphite's 100% owned graphite project located near Lac Guéret, about 300 km north of Baie-Comeau, part of the Nitassinan (traditional lands) of the Pessamit First Nation.
Mason Graphite intends to build an open-pit graphite mine, which is expected to produce 50,000 tons of concentrate per year. The mine is also expected to include infrastructure for a concentrator, as well as maintenance, office, and personnel buildings. Once in production, the operation is expected to create approximately 80 direct jobs for both aboriginal and non-aboriginal inhabitants of the area. Construction could potentially begin as early as 2015.
A Generational Project
Representatives of Mason Graphite and the Pessamit Innu describe the Lac Guéret mine as "a generational project," since the resource is amply sufficient to achieve production at full capacity for an initial 22-year period, which represents less than 10% of the total mineral resource. "The Lac Guéret project will be a world-class operation," said Mason Graphite CEO Benoît Gascon. "Not only is this very high quality, crystalline large-flake graphite, a highly sought-after product on international markets, but the average grade of the ore, as set out in the Company's PEA, is approximately 27.4% Cg and its purity is at the top of the grading scale. We expect prices to average an estimated $1,525 per ton, resulting in potential sales of $76.2 million per year. That's what I call a promising future!"
Fairness between Two Nations
René Simon, Chief of the Pessamit Innu, expressed his satisfaction regarding the cooperation agreement signed with Mason Graphite, which not only clears the way for an Impact and Benefits Agreement (IBA) but provides for a fair distribution of construction, maintenance, and operating jobs and contracts, according to the available resources of the communities. "It's understood of course that our side has some catching up to do in terms of economic development," said Chief Simon. "Pessamit doesn't have the businesses and qualified workers that other parts of the Côte-Nord region do. That's why the cooperation agreement includes incentives and training programs delivered through existing organizations as well as onsite apprenticeships once the project is underway. Our agreement with Mason Graphite is based on the principal of equity between two nations, which is why we, the Innu of Pessamit, are actively supporting it."
The Starting Point for Regional Dialogue on the Project
The agreement is an important first step in establishing the kinds of relationships Mason Graphite seeks to have with the Pessamit community and all the people of Manicouagan. Mason Graphite plans to hold information and consultation activities in the coming months to establish and build lasting ties with the regional community.
A Strategic Mineral
Both Mason Graphite and the Pessamit First Nation agree on the benefits of the mining project for the entire region; not only for the health of the economy and employment opportunities, but also for environmental protection. The process of producing graphite by physical separation requires no chemicals and the mine is expected to be considerably less invasive and will have a much smaller footprint than typical mining operations. Graphite is non-toxic and is not considered a pollutant, therefore the environmental effects of extracting and handling this material are minimal. Natural graphite has numerous applications in industrial refractories, notably in steel mills. It is also used in braking systems and in various types of batteries, including lithium-ion batteries, for which demand is growing by some 20% per year according to automotive industry estimates. This makes it truly a strategic mineral.
About Mason Graphite
Mason Graphite is a Canadian mining company focused on the exploration and development of its 100% owned Lac Guéret graphite property, located in northeastern Québec. The property hosts a National Instrument 43-101 compliant Mineral Resource featuring 50,024,000 tonnes grading 15.6% Cg, including 6,672,000 tonnes grading 32.4% Cg, in the Measured and Indicated categories and 11,861,000 tonnes grading 17.1% Cg, including 2,637,000 tonnes grading 30.5% Cg, in the Inferred category (see press release dated December 5, 2013). Excellent potential exists for further mineral growth. A Preliminary Economic Assessment study was completed on a 7.6Mt mineral resource estimate from July 2012 which features 22 years of production at 27.4% Cg and a pre-tax internal rate of return of 33.7% (see technical report entitled "Technical Report on the Mineral Resources Estimation Update 2013, Lac Guéret Graphite Project, Quebec, Canada" issued on January 17, 2014). The Company's senior management team possesses significant graphite expertise from their experience at Timcal/Imerys, including Benoît Gascon, CPA, CA, who held executive positions for 20 years, including over 6 years as President and CEO; Jean L'Heureux, Eng., Executive Vice-President, Process Development, with over 20 years of experience; and Luc Veilleux, CPA, CA, Chief Financial Officer and Executive Vice-President, with 8 years of experience. Timcal, now owned by Imerys, is one of the largest graphite producers in the world.
Qualified Person
Jean L'Heureux, Eng., Mason Graphite's Executive Vice-President of Process Development and a Qualified Person as defined by National Instrument 43-101, has reviewed and approved the scientific and technical content of this press release.