Northern Graphite Resumes Processing at North America's Only Producing Graphite Mine Amid Rising Market Demand Graphite Sales Volumes Rose Monthly Through the Third Quarter
Northern Graphite Resumes Processing at
North America's Only Producing Graphite Mine
Amid Rising Market Demand
Graphite Sales Volumes Rose Monthly Through the Third Quarter
Ottawa, Ontario--(Newsfile Corp. - November 1, 2023) - Northern Graphite Corporation
(TSXV: NGC)
(OTCQB: NGPHF) (FSE: 0NG) (XSTU: 0NG)
(the "
Company
" or "
Northern
") is pleased to announce
it has resumed processing ore at Lac des Iles ("
LDI
"), North America's only producing graphite mine,
amid rising market demand and to restock inventories for certain products.
Sales volumes at Quebec-based LDI rose each month in the third quarter. Total sales for the three-month
period were 2,587 metric tonnes, representing an increase of more than 25 percent over the 2,016
tonnes sold in the second quarter, based on preliminary, unaudited data.
"What we saw starting in the third quarter was that customers were really coming off the sidelines to
secure supply for the year after a hiatus in the first half," said Northern Chief Executive Officer Hugues
Jacquemin. "With sales volumes up more than 25 percent in the third quarter, together with what we are
forecasting into the fourth quarter and next year, we believe there will be continuing strong demand for
our product, and we have resumed processing at LDI to make sure we have continuous supply."
The LDI mine and plant were temporarily placed on care and maintenance during the second and third
quarters of 2023 amid challenging markets and lower prices for its products, while the Company
continued to supply customers from stockpiled inventories. Global graphite markets were negatively
impacted by lower-than-anticipated demand from steel and electronics markets and after China
removed electric vehicles ("EV") sales incentives at the end of last year. These factors led to excess
Chinese graphite production coming to export markets at lower prices.
"We saw a total shift in demand after China reinstated EV incentives this year," said Mr. Jacquemin.
"We also had the October 20
th
news that China would start imposing controls this December on certain
graphite exports used in battery making, which will drive further supply concerns. Fortunately for our
customers, Northern has immediate capacity available to supply the market and we also have the ability
to scale quickly with our mine in Namibia."
LDI has been supplying graphite markets for over 30 years, from refractory bricks for steelmaking to heat
management in mobile phones and friction and lubrication products for brakes and brake linings for the
global automobile industry. Recent testing verified that LDI graphite can be processed into Battery
Anode Material ("
BAM
"), a key component of Lithium-Ion batteries, and can perform at or above the
standards of commercially available reference materials.
Graphite has been classified by the U.S. Department of Energy as one of five minerals deemed critical
for the development of EV batteries and the energy transition, but it has largely been overshadowed by
other battery minerals like lithium, cobalt, nickel, and manganese. For a vehicle to qualify for the full
US$7,500 EV tax credit reflected in the landmark U.S. Inflation Reduction Act ("IRA"), a minimum
percentage of the critical minerals by value in the battery (such as graphite, lithium, and cobalt) must be
sourced from the United States or one of the countries with which the U.S. has a free trade agreement.
Minimum requirements begin at 40 percent and increase to 80 percent by 2026 and 100
percent by
2028.
Northern's LDI mine and facilities in Quebec, and its Okanjande mine and facilities in Namibia, are fully
permitted, and the Company is engaged with governments and automakers as it pursues its strategy to
be the next generation carbon materials company for the energy transition. The Company has a
sustainable, integrated, mine-to-market-to-battery solution that will be eligible for credits on EV batteries
produced by the United States and its trading partners that are coming into force through the end of the
decade under the terms of the IRA.
"As the only producer of graphite in North America, we are in a critical position, more than ever, to
service graphite demand from North American battery makers," said Mr. Jacquemin.
Investor Relations Agreements Update
Further to the Company's press release dated October 11, 2023 announcing the engagement of
Senergy Communications Capital Inc. ("
Senergy
") to provide investor relations and marketing services
to the Company for an initial period of four months, Northern confirms Senergy does not have any right or
intent to acquire an interest in the Company. In addition, all direct and indirect consideration payable to
Senergy consists only of the $25,500 fee (+HST) payable under the agreement as disclosed. This fee
has been paid upfront out of the working capital of the Company.
In addition, further to the Company's press release dated October 11, 2023 announcing the engagement
of Outside The Box Capital Inc. ("
OTBC
") to provide investor relations and marketing services to the
Company, the Company announces it has amended the terms of its agreement with OTBC. The number
and exercise price of the stock options to be granted to OTBC has been changed from 666,667 options
exercisable at $0.30 per share to 615,384 stock options exercisable at $0.325 per share. Similar to the
previously announced options, all options are exercisable for a period of two years and vest in four equal
tranches, each of which will be 153,846 options under the revised terms, on each of the dates which are
three, six, nine and 12 months from the date of grant and, in the event the OTBC agreement is
terminated in accordance with its terms, all options that have not yet vested will expire and be terminated
as of the date of termination of the agreement. In addition, the Company will also pay OTBC a fee of
$50,000 per quarter during the term of the agreement, payable in arrears as of each quarter end as
previously announced, however, the restriction that no amount of the fee would be payable to OTBC
unless it exercised the options which had vested as of the applicable quarter end has been removed.
The Company also confirms OTBC does not have any right or intent to acquire an interest in the
Company, other than the stock options noted above. In addition, all direct and indirect consideration
payable to OTBC consists only of the $50,000 quarterly fee payable under the agreement and the stock
options as disclosed. The quarterly fee will be paid out of the working capital of the Company.
Northern Graphite in the News
China ban is opportunity for Canada's graphite developers (mining-journal.com)
China requiring export permits for graphite, and what this means for Canada's industry (BNN
Bloomberg)
Northern Graphite, North America's Only Producer of Graphite, Comments on China Graphite Export
Controls
Miners race to realise graphite projects as China controls exports | Reuters
China's curbs on graphite exports a roadblock for electric vehicles - Marketplace
Canada is sitting on a critical minerals mother lode. But is it ready for the new gold rush? | CBC News
Northern Graphite completes Lac des Iles drilling program, Quebec - Resource World Magazine
Northern Graphite plans Quebec battery hub - Mining Journal (mining-journal.com)
Northern Graphite releases estimate for Mousseau resources - Canadian Mining Journal
Northern Graphite Completes Additional Royalty Financing on Bissett Creek Project - Junior Mining
Network
Northern Graphite tables positive PEA in Namibia - Resource World Magazine
About Northern Graphite
Northern is a Canadian, TSX Venture Exchange listed company that is focused on becoming a world
leader in producing natural graphite and upgrading it into high value products critical to the energy
transition, including anode material for lithium-ion batteries/EVs, fuel cells and graphene, as well as
advanced industrial technologies.
Northern is the only graphite producing company in North America and will become the third-largest
producer outside of China when its Namibian operations come back online. The Company also has a
large-scale development project, Bissett Creek, in Ontario that we expect will be a source of continued
production growth in the future. All projects have "battery quality" graphite and are located close to
infrastructure in politically stable jurisdictions.
For media inquiries contact
Pav Jordan, VP of Communications
Email:
For additional information
Please visit the Company's website at
http://www.northerngraphite.com/investors/presentation/
, the
Company's profile on
www.sedarplus.ca
our
Social Channels
listed below or contact the Company at
(613) 271-2124.
YouTube
Cautionary Note Regarding Forward-Looking Statements
This news release contains certain "forward-looking statements" within the meaning of applicable
Canadian securities laws. Forward-looking statements and information are frequently characterized by
words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "potential",
"possible" and other similar words, or statements that certain events or conditions "may", "will",
"could", or "should" occur. Forward-looking statements in this news release include statements
regarding, among others, sales volume expectations for the fourth quarter and next year and the
Company's intentions to restart the Okanjande mine in 2024 and develop Bissett Creek. All such
forward-looking statements are based on assumptions and analyses made by management based on
their experience and perception of historical trends, current conditions and expected future
developments, as well as other factors they believe are appropriate in the circumstances. However,
these statements are subject to a variety of risks and uncertainties and other factors that could cause
actual events or results to differ materially from those projected including, but not limited to,
unexpected changes in laws, rules or regulations, or their enforcement by applicable authorities; the
failure of other parties to perform as agreed; social or labour unrest; changes in commodity prices;
unexpected failure or inadequacy of infrastructure and the failure of ongoing and contemplated
studies to deliver anticipated results or results that would justify and support continued studies,
development or operations and the inability to raise required financing. Readers are cautioned not to
place undue reliance on forward-looking information or statements.
Although the forward-looking statements contained in this news release are based on what
management believes are reasonable assumptions, the Company cannot assure investors that
actual results will be consistent with them. These forward-looking statements are made as of the date
of this news release and are expressly qualified in their entirety by this cautionary statement. Subject
to applicable securities laws, the Company does not assume any obligation to update or revise the
forward-looking statements contained herein to reflect events or circumstances occurring after the
date of this news release.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this
news release.
To view the source version of this press release, please visit
https://www.newsfilecorp.com/release/185899