Graphite into Production
The race is not always to the swift nor the battle to the strong. But that is the way to bet.
In many industrial metals we know where there are large supplies in the ground. With moly I’ve heard it said that we have identified a 190-year supply already. So finding a moly deposit is meaningless. Putting it into production is what counts. If there are 20 companies moving to production, the first five into production will almost certainly make money and the last five will almost certainly lose money.
Contrary to the belief system of the manipulation/conspiracy theory crowd, supply and demand really do have an impact on prices. Those who get into production the soonest will get the most value out of high prices.
Graphite prices are high, ranging from $500 a ton for amorphous graphite to the more highly priced large flake graphite at $2500 a ton.
Big North Graphite (NRT-V) just announced picking up two concessions in Sonora Mexico that were past producers. They picked up 100% interest in the Aki Wiki project and a 50% interest in the Nuevo San Pedro project. NRT is in the process of funding the restarting of the Nuevo San Pedro project with production to begin shortly of 10,000 tons per annum.
The Nuevo San Pedro project is the lower value amorphous graphite but that is still 60% of graphite demand. Any production is still better than no production. If they meet their goal of 10,000 tons of production, that’s 50% of $3-$5 million per year cash flow.
That doesn’t sound like much at all but with a market cap of $1.7 million, any cash flow is a good thing. The stock seems pretty cheap to me and when the market starts to pay attention, Big North will benefit.
Big North is an advertiser. I am a shareholder and I participated in a PP at higher prices. Naturally I am biased and as always, you are solely responsible for your own due diligence.
Big North Graphite