A recent article in Seeking Alpha highlighted Canada Carbon Inc. (TSXV:CCB).
Six years after graphite “blew up” in the junior resource space in 2011, the reality that producing graphite concentrate is not actually a business model has sunk in. Canada Carbon (V.CCB) has had a high purity, high value strategy from the beginning. Bruce Duncan, Canada Carbon’s CEO, recognized early on that Canada Carbon’s flagship Miller hydro-thermal graphite deposit in Quebec had very high purity graphite at the mine head. The question was where to sell that graphite for the best dollar.
Canada Carbon owns one of the highest purity natural graphite projects under development anywhere in the world. Its Miller hydrothermal lump vein graphite deposit yields nuclear grade natural graphite with only relatively inexpensive flotation and thermal upgrading techniques. Instead of the weeks of expensive, environmentally damaging processing at 2800 degrees Celsius needed to produce nuclear grade synthetic graphite, Canada Carbon’s natural graphite can be fully processed in an inexpensive, environmentally responsible manner, yielding graphite purer (99.9998%) than any natural or synthetic graphite used in U.S. government sponsored nuclear energy research programs. The Miller deposit flotation concentrate is of such high purity that Canada Carbon begins with a huge advantage because the costs of thermal treatment are proportional to the impurity content.
Canada Carbon’s management recognized the potential value of the Miller deposit early on, and began advancing the project’s environmental assessment work and permitting concurrently with resource definition, process engineering and economic assessments. The Company is on target to complete a Bankable Feasibility Study later this year, with final permits anticipated by year’s end. If you consider that the graphite structure at the heart of the proposed open pit mine was discovered in July 2014, the pace at which the project has been advanced is remarkable.
Ultimately the graphite mining and processing business is about making money. Canada Carbon has identified a huge target market and is ready to service that market with its nuclear grade graphite. The money should follow.
Like most of the junior graphite sector, Canada Carbon’s share price took a bit of a beating in 2016. It’s trading around CDN $.25 with 95.63 million shares outstanding. However, unlike a lot of graphite companies, Canada Carbon has a unique value added product for which there is a significant and growing demand,at what is expected to be a very good price. As the junior graphite space shakes out, Canada Carbon looks ready to lock up a significant part of the natural nuclear graphite market. Because purity really does mean profit when it comes to graphite.