Lomiko Metals Inc. (TSX-V: LMR, LMRMF, FSE: DH8B): Exploration-Stage Company, that Discovered High-Grade Graphite in Quebec; Interview with Paul Gill, CEO
|
By Dr. Allen Alper, PhD Economic Geology and Petrology, Columbia University, NYC, USA
on 11/6/2019
Lomiko Metals Inc. (TSX-V: LMR, LMRMF, FSE: DH8B) is a Canadian-based, exploration-stage company, that discovered high-grade graphite at its La Loutre Property in Quebec and is working toward a Pre-Economic Assessment (PEA) that will increase its current indicated resource of 4.1 Mt of 6.5% Cg to over 10 Mt of 10%+ Cg. We learned from Paul Gill, CEO of Lomiko Metals, that the exploration has been completed and it is showing two different areas of deposits: the graphene battery zone and the refractory zone. The consolidated 43-101 resource estimate is expected soon. According to Mr. Gill, the material at Lomiko's discovery is of similar or better quality than the material at the Imerys Carbon Graphite Mine, 53 km to the Northwest and 100 kilometers from the Imerys processing facility at the Port of Montreal. The Imerys mine has a mine closure plan for 2022 and needs replacement. Located near a producing mine, with an experienced workforce, with excellent infrastructure and year around working capability, La Loutre property has great potential to become the next graphite mine.
Lomiko Metals Inc.
Dr. Allen Alper: Could you give our readers/investors an overview of your Company, Paul, and tell them what differentiates your company from others?
Paul Gill: Right. Lomiko Metals has been working in the battery materials space for about six years now. We've focused on graphite because that is the material that makes up the anode of a lithium-ion battery, which is the main power source for most electric vehicles. We have discovered a very good deposit of material in Quebec and now with 170 drill holes, is showing two different areas of near surface mineralization. One is called the graphene battery zone and the other is the refractory zone. We just finished the refractory zone drilling in 2019 and we will be going to a consolidated 43-101 resource estimate shortly.
What makes us different from other companies in this particular sector is that we are located only 53 kilometers from the only operating graphite mine in North America, the Imerys Carbon and Graphite Mine. The discovery we've just made at the refractory zone is similar or of better quality than the material or the grades that are being mined at Imerys. This is very significant because everyone has an understanding that the Imerys Carbon Graphite Mine is shortly going to run out of mineable ore and needs replacement. So, we're in a very good situation.
There are other very relevant companies in the space, Nouveau Monde, which is TSXV:NOU, Mason Graphite, which is TSXV:LLG, Graphite One, which is TSXV:GPH and Northern Graphite, TSXV:NGH. But all of those that are post pre-economic assessment and have major flaws. Mason needs to build infrastructure. Nouveau Monde has sulfur in their particular deposit, which adds cost. Graphite One is located in the Aleutians Islands in Alaska, which is a very difficult mining jurisdiction because of the weather and Northern Graphite has low grade which may hamper the economics
But Lomiko is in a Goldilocks zone, located just north of the Port of Montreal and just south of the Imerys Carbon Graphite Mines. We think we have a very distinct advantage because there is now a North American strategy being put in place for battery materials, which includes lithium, graphite and cobalt.
Dr. Allen Alper: Sounds excellent. Could you tell our readers/investors the highlights of 2019 and your plans for 2020?
Paul Gill: The highlight for Lomiko was finding one strike length was 110 meters, with grades of 14.5%, which are double what they are mining at the Imerys Carbon Graphite Mine. Imagine mineralization taller than the Statue of Liberty and obviously there's not just one drill hole that's only six inches wide there. It is probably indicative of a larger area of mineralization.
Of course, we have done many other drill holes and have confirmed a mineralization zone that extends for 900 meters, from the Northwest to the Southeast at the refractory zone and also a width of about 400 meters. So, we have a definite area of a high grade and of mining potential. We're ready to do a 43-101 resource estimate and the preliminary economic assessment, which will put a dollar value on that particular deposit.
Dr. Allen Alper: Sounds excellent! Great results in 2019!
Paul Gill: It certainly is.
Dr. Allen Alper: Sounds very good! And where you're located is fantastic. Excellent! It's great to have high grade and high quality and also to be in a great location.
Paul Gill: Absolutely. It helps to have that infrastructure in place. There's power all the way through, there's road access all the way to the property. The only portion of it that's gravel is about eight kilometers, which is really not that bad. We can surface that pretty easily and that'll get us right to the site.
It has year-around working capability. Very important! Proximity to the Imerys Mine means that there are workers that are experienced in that particular area for the last little while. That workforce will be available to us. They don't want to move to another location. We'll be able to hire some of those people or in fact there may be a potential for a buyout of our company.
Dr. Allen Alper: Sounds excellent! Could you tell our readers/investors a little bit about graphite market and why it's so important?
Paul Gill: Yes, absolutely. It's a fascinating market. It is one of the few markets that does not have a many large multinational companies involved. Lithium has a secure niche with Albemarle, down in the States and a couple of large Chinese companies. There is Rio Tinto and BHP and Glencore all involved in the zinc, nickel and copper markets, which are all other relevant battery materials.
But in graphite, there is no one big producer except for the country of China. Now, the country of China has 50 of the world’s 91 lithium-ion mega factories. If you can wrap your head around that, 91 mega factories. The amount of factories, ready to produce li-ion batteries and being built, means that the demand for battery materials is really going to spike as electric vehicles get on the road and there's more demand for them.
We want to be in place to supply that demand when it comes. We're in a perfect spot now because even Bloomberg has predicted that in the next decade there's going to be a five times increase, in demand for battery materials and specifically graphite.
Dr. Allen Alper: Oh, that sounds excellent. Could you tell our readers/investors about your background and your Team?
Paul Gill: Certainly. I have been involved in mining for 20 years. Our first company was Norsemont Mining in 2003, which started at 1 million market cap and subsequently built that to a point at which new directors became involved. We eventually sold that project for $512 million in 2011 to Hudbay Minerals. So, that was a great experience and we want to duplicate that. What I did was look for other materials that are going to be in high demand and have that exponential return potential.
That's when I looked at graphite. Our CFO, Jacqueline Michael has been with The Company for many years and was part of a buyout of the previous iteration, which was Conac Software. Then she stayed on to be CFO. We have two very good independent Directors, Gabriel Erdelyi and Julius Galik, who help us with running the Company and a vast array of advisors that have come on in the last little while, Dean Nawata, Sandio Pereira, Jason Gregg, who have great connections in the mining market and Mike Patrina, who's a professional engineer.
So, we're really building up a team that can be put in place to develop this project once we get the preliminary economic assessment. I think by any estimate, the fact that we were at only 2 million market cap presently and the base concept of the project going to preliminary economic assessment, indicates a jump in value. It's an opportunity that is very, very relevant right now in the markets with Lomiko trading on the TSX Venture with the symbol LMR and the OTCQB under the symbol LMRMF.
Dr. Allen Alper: Paul, could you summarize the reasons our readers, investors should consider investing in Lomiko.
Paul Gill: Number one, we've just finished drilling and are going to update a resource, which will increase our valuation and will go right to a preliminary economic assessment, which will provide a value for the project that will go right onto our audited financial statements. Number two, we are currently doing a financing in Canada at five cents per share Canadian, but the market is trading under that. So, there is an opportunity for buyers in the United States to play a bit of arbitrage and because the financing is not available in the United States.
Three, we think the battery materials market is going to be a great place to have a return on investment that is exponential, and four, we want to get involved in these markets as they're moving. It's nothing different from getting involved in computers in 1980 before they became universally used, getting involved in the internet in 1990 before it became universally used, or smartphone in the year 2000 before they became universally used.
It's the same general trend and it's a big trend that we need to recognize and realize that there's a great opportunity for investors. We want to make a strong argument that now is the time for Lomiko.
Dr. Allen Alper: Sounds like extremely strong reasons for our readers/investors to consider investing in Lomiko. Paul, was there anything else you'd like to add?
Paul Gill: Just to thank you for interviewing me at Lomiko Metals Inc. for Metals News. I appreciate it.
Dr. Allen Alper: Thank you. I enjoyed hearing about everything you have been doing. I’m very impressed. We’ll publish your press releases as they come out so our readers/investors can follow your progress.
https://www.lomiko.com/
A. Paul Gill, President & CEO
604-729-5312
Email: info@lomiko.com
|
|