The green energy industry is booming. Unprecedented positive trends seen year after year present junior mining companies with exceptional growth potential as vital minerals like graphite and lithium needed to power alternative energies surge in demand.
Market research estimates that worldwide graphite output needs to increase by nearly 500 percent by 2050 in order to meet growing demand for energy storage. If you are an investor looking for exposure in this market, there is not better time to invest
South Star Mining (TSXV:STS, OTCQB:STSBF) is set to contribute to filling this global graphite demand. It currently operates its flagship Santa Cruz graphite project in the mining-friendly jurisdiction of Brazil. The project is nearing construction and is slated for the first production in 2022.
“This is a production story, it’s not something that’s going to take years to come to life. We have 12 months of construction and commissioning already scheduled,” stated South Star CEO Richard Pearce.
The company operates in what is arguably the best region worldwide to be developing a new graphite project. Brazil currently produces upwards of 90,000 tonnes of graphite on an annual basis and has a significant internal demand for the product, which advantageously positions South Star as a first mover in the South American graphite production space. More than that, once in production, South Star will become the first new graphite producer in the Americas in a decade.
The flagship Santa Cruz graphite project sits in the second largest flake graphite producing district in the world. This robust project hosts the perfect storm of large flake ore mineralization and production quality concentrates of over 95 percent purity.
South Star has been quick to advance its flagship asset for production readiness. In October 2020 the Phase 1 environmental permit was approved and in December 2020, South Star released exciting news that it received the mining permit for its 5,000 tonnes per year (tpy) Phase 1 pilot plant. Permitting and licensing for Phase 2 operations are already underway and documents will be submitted in December 2021. This should advance the Phase 2 schedule by approximately 12 months.
Plans for 2021 include working through the plant’s detailed design and engineering process in the first half of the year and commencing construction in the second. Leveraging the rapidly growing graphite demand and positive market outlook, South Star aims to become a significant producer in the battery metals space.
The company projects it will be ready for commercial production in late 2022. Since its conception, South Star has been quick to begin constructing and commissioning the necessary infrastructure and parameters for production. The company intends to start small and scale up operations in a well-engineered multi-phase plan to control risks.
South Star Mining’s management team includes experienced mining heavyweights, mine builders and operators. The unparalleled local expertise, proven track records of success and vested interest in company success prime South Star for exceptional growth and project achievements.
South Star Mining’s Company Highlights
- South Star Mining Corp. is an emerging mining production company focused on acquiring and developing near-term production projects in Brazil.
- The company’s flagship Santa Cruz graphite project leverages mining-friendly conditions and strategic positioning in the second largest flake graphite producing district in the world.
- Santa Cruz is an open-pit deposit with 15 drill-ready targets across a 13,000-hectare property. The entire land package hosts widespread mineralization, according to the Brazilian Mining Authority.
- South Star’s current market capitalization stands at only 2.5 per cent of its project NPV (pre-financing).
- The company operates a two-phased approach for project development to minimize risk and intelligently allocate capital for shareholder value. This low CAPEX approach includes a pilot plant and large plant phase following bench scale and plant testing programs.
- South Star is committed to a corporate culture, project execution plan and safe operations that embrace the highest standards of ESG principles based on transparency, stakeholder engagement, on-going education and stewardship.
South Star Mining’s Key Project
Santa Cruz Graphite Project
The Santa Cruz graphite project consists of 13 approved exploration licenses covering approximately 13,000 hectares in the Bahia State of Brazil, the second largest flake graphite producing district in the world.
Extensive development has been completed to date on the property, including over 7,000 metres of drilling and a successful pilot plant test on over 30 tonnes of mineralized material. In 2017, the South Star completed a PEA technical report for the project that indicated resources of 14,990,400 tonnes at 2.70 per cent graphite and inferred resources of 3,572,100 tonnes at 2.90 per cent graphite. An NI 43-101 PFS and updated resource estimate have also been completed.
Phase 1 operations included a 5,000tpy fully licensed pilot plant. Phase 2 operations represent a larger scale concentration plant with 25,000tpy planned production scalability and environmental work program scheduled for April 2021.
The property hosts sizable geologic upside, with 95 per cent of the project unexplored. After financing, South Star intends on developing the project’s 10-15 drill targets and marketability of Santa Cruz’s high purity flake production.
South Star Mining’s Management Team
Richard Pearce — CEO & Director
Richard Pearce is an entrepreneur and founding partner with over 20 years of experience in planning and managing complex operations throughout the Americas. He has been based in Brazil since 2008 and worked throughout the country. He has a wide range of consulting and advisory experience including technical services, project & asset development, corporate advisory services, business administration & incorporation services, deal origination, M&A advisory, construction, and operations. He is based out of São Paulo, Brazil and is a native speaker of English as well as fluent in Portuguese and Spanish. Country experience includes Canada, United States and most countries throughout Latin America. He is passionate about standing up companies and helping them grow and explore the Brazilian markets. He is also a Qualified Person (QP) as defined by NI43-101.
Dave McMillan — Chairman
With over 50 years in the resource industries, Dave McMillan’s career has spanned manufacturing, marketing, sales and financing. He has spent 17 years as an investment advisor VP, Senior VP, director, and member of the Executive Committee for Yorkton Securities and Yorkton Holdings Inc. McMillan holds board positions on several private and publicly traded oil & gas and mining companies.
Bennett Liu – CFO
Bennett Liu joins South Star from Red Fern Consulting Ltd., a full-service accounting group that provides financial and support services for public companies including accounting, regulatory compliance, audit management and financial reporting. Mr. Liu has served as Chief Financial Officer for multiple publicly traded companies (TSX Venture Exchange and CSE-listed) with a focus on the resource sector. He received his Bachelor of Technology, Accounting from the British Columbia Institute of Technology.
Eric Allison — Director
Eric Allison has over 36 years of experience in the natural resource industry, working in technical, business, project development and management roles. He formerly served as CEO and COO of Brazahav Resources, a private entity developing a brownfield gold mine project in Brazil. Prior, he was the director of research and chief geologist at Casimir Capital LP, specializing in junior mining companies and the director of business development at Sempra Commodities. Over his career, Allison has also served in various roles for Cyprus Amax Minerals, Amax Energy, SPG Exploration and Texaco. He has served on the boards of several private and public companies.
Felipe Holzhacker Alves — Director
Felipe Holzhacker Alvez is a professional mining engineer with a Master’s degree in Political Economics of Resources from the Colorado School of Mines. He is a Brazilian native who combines international capital markets experience with an extensive local network of governmental and regulatory agencies, resource financiers and technical, legal and tax consulting services. Alvez is the founder and CEO of Frontera Minerals Group, a Brazil-focused exploration and project development company. He previously held various roles at Rand Merchant Bank, where he was mainly responsible for Latin American Investments. His technical experience includes roles at open pit and underground mines. He is currently a board member of Trek Mining and the President of CBRR (Brazilian Commission for Resources and Reserves), Brazil´s equivalent to NI43-101/CIM in Canada.
Marc Leduc, Independent Director
Marc Leduc is a mining engineer and geologist with over 30 years of experience involving all aspects of the development, operations, planning and evaluation of mining projects including over 20 years in Latin America. Marc served as the President and CEO of Luna Gold, operator of the Aurizona mine in Brazil, from 2015 to 2016. He holds a B.Sc. (Honors) in Mining Engineering from Queen’s University and a B.Sc. in Geology from the University of Ottawa.
Daniel Wilton, Independent Director
Daniel Wilton has 25 years of experience in M&A, corporate finance and principal investing in the mining sector. Dan was most recently a Partner at Pacific Road Capital Management, a mining-focused private equity investment firm with approximately $800 million under management. At Pacific Road, Dan reviewed a number of projects in Brazil, led the investment in Luna Gold (now Equinox Gold Corp.) and financed the development of the Aurizona gold project through critical pre-feasibility and permitting activities. Prior to joining Pacific Road, Dan’s previous roles included Managing Director and Head of the Global Mining and Metals Group at National Bank Financial Inc..and other corporate finance and M&A roles at global institutions based in London, Toronto and New York.
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