Critical Metals

Rare Earth Investing

Focus Graphite in conjunction with site partner and operator SOQUEM each own a 50-percent stake in the Kwyjibo project, located 125 kilometers northeast of the Quebec port city of Sept-Iles.

Focus Graphite (TSXV:FMS) has released the results of a preliminary economic assessment (PEA) for the Kwyjibo rare earths project in Quebec. The positive results indicate a 10-year mine life and an estimated post-tax NPV of C$380.7 million.

Kwyjibo is owned jointly by Focus and site partner and operator SOQUEM, which each hold 50-percent stakes. The asset is situated 125 kilometers northeast of the Quebec port city of Sept-Iles, and the two companies commissioned Met-Chem to conduct the PEA last October. SOQUEM is the Quebec government’s commercial mining corporation.

The results of the assessment indicate that the rare earths at the property are concentrated in three minerals: apatite, britholite and allanite. Other highlights include a post-tax IRR of 18 percent; the base-case scenario for Kwyjibo uses a basket price of C$42.81 per kilogram of total rare earth oxides (TREO).

“We are very pleased with the results of the PEA, which suggest that the Kwyjibo REE Project is unique in Quebec in terms of geological setting, style of mineralization and economic potential,” Gary Economo, Focus Graphite’s president and CEO, said in a Thursday (June 28) press release.

Kwyjibo includes the Josette Northeast and Josette Southwest zones, whose combined measured and indicated resource stands at 6.92 million tonnes at 2.72 percent TREO; its inferred resource comes in at 1.33 million tonnes at 3.64 percent TREO.

The PEA focuses only on Josette Northeast, where the company envisions the construction of an underground mine and on-site concentrator, with a hydrometallurgical processing facility located off site.

“The results not only demonstrate that significant progress has been made in moving the project from the exploration phase to the mineral deposit appraisal phase, but also that the potential to expand REE resources at depth, together with refinements in the hydrometallurgical recovery process and other technical improvements, could result in significant benefits for the project’s economics. Clearly, additional work is warranted at Kwyjibo,” Economo added.

As mentioned, Kwyjibo’s mine life is pegged at 10 years, with average annual ore production estimated at 387,000 tonnes at 3.29 percent TREO. Focus believes over its total life of mine the project will produce 3.55 million tonnes at 3.29 percent TREO, with average annual concentrate production coming in at 174,000 tonnes grading 7 percent TREO. Capital expenditure for the rare earths project is pegged at C$723.6 million with a 3.4-year payback period.

Rare earths, like those discovered in Quebec, are becoming increasingly vital components in the complex technologies people rely on every day, including smartphones, watches and cars. Focus and SOQUEM hope the PEA for Kwyjibo evidences the potential the province possesses.

“The development of the Kwyjibo Project can contribute to economic diversification efforts in the Côte-Nord region, while at the same time triggering the growth of a sustainable rare earth industry in Quebec,” noted Olivier Grondin, president and CEO of SOQUEM. He continued, “[t]he positive PEA results will also raise awareness about Kwyjibo and shine a new light on Quebec as a favorable jurisdiction to host potentially economic rare earth deposits.”

Aside from Kwyjibo, Focus holds the Lac Knife, Lac Tetepisca and Lac Guinecourt graphite properties. Lac Knife, for which Focus has completed a feasibility study, is its flagship asset, and according to the company it is one of the most advanced graphite projects in North America.

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Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: Focus Graphite is a client of the Investing News Network. This article is not paid-for content.



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