According to Graphite One Resources, the project is the largest-known large-flake graphite deposit in the US and may be key to the US defense industry.
Vancouver-based Graphite One Resources’ (TSXV:GPH) project in Alaska may have the potential to become key to the US defense industry, which issued a report recommending that the country reduce its import reliance on critical equipment and material.
“The White House report makes a strong case for the strategic importance of minerals like graphite to the US defense industrial base, and for the broader advanced manufacturing sector,” said Anthony Huston, CEO of Graphite One.
“With the US 100-percent import-dependent for its natural graphite supply, and demand projections showing sharply increased graphite needs, we see the potential for our Graphite Creek project to be a key component in the materials supply chain essential to the high-tech sector, renewable energy and national security/defense applications.”
According to the White House report, China represents a significant and growing risk to the supply of materials deemed strategic and critical to US national security, including a growing number of both widely used and specialized metals, alloys and other materials.
Additionally, the last unclassified National Defense Stockpile Requirements report projects an 83,000 metric ton shortfall for graphite in one of its main crisis scenarios.
“The report’s recommendation of direct investment in companies developing domestic sources of strategic and critical materials is a welcome sign,” said Huston, “given that graphite is essential to so many battery applications and energy storage systems required by the defense sector and commercial sectors alike.”
The company’s Graphite Creek project, which is located in western Alaska, could potentially allow Graphite One to become a US producer of high grade coated spherical graphite (CSG) that is integrated with a domestic source.
According to a preliminary economic assessment (PEA), potential graphite mineralization mined from the project is expected to be processed into concentrate at a processing plant, which would be located on the Graphite Creek property.
The PEA has also estimated an average annual production of 55,350 tonnes of CSG, once the mine reaches its full production in its sixth year, through its estimated life of 40 years.
In August, the company started work to support a prefeasibility study on the project, after raising US$4 million in a private placement.
Looking ahead, the company intends to make a production decision on the project once a feasibility study is completed.
On Wednesday, shares of Graphite One were up 11.11 percent, closing at C$0.05.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Graphite One Resources is a client of the Investing News Network. This article is not paid-for content.