The net proceeds of the placement will be used to finance the completion of the bankable feasibility study and permitting with respect to the Company’s Bissett Creek graphite project and for working capital and general corporate purposes, as well as detailed engineering and design and the acquisition of long lead time equipment upon the positive completion of the feasibility study.
This press release is for information purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Northern Graphite Corporation is a Canadian company that has a 100% interest in the Bissett Creek graphite project located in Ontario. Graphite prices have increased substantially due to the ongoing modernization of China and other emerging economies which has resulted in strong demand from traditional steel and automotive markets. In addition, new applications such as lithium ion batteries, vanadium redox batteries, fuel cells and nuclear power have the potential to create significant incremental demand growth. It takes 20 to 30 times as much graphite as lithium to make a lithium ion battery and their use in the growing EV/HEV market is expected to require significant increases in graphite production. However, graphite production and exports from China, which produces 70% of the world’s supply, are expected to decline and an export tax and a licensing system have been instituted. Both the European Union and the United States have declared graphite a supply critical mineral.
Northern Graphite is well positioned to benefit from this compelling supply/demand dynamic with a large flake, scalable deposit that is located close to infrastructure. The Company expects to complete a bankable feasibility study and full permitting in the first half of 2012, following which it could begin construction, subject to the results of the study and financing.