Chase Mining Corporation Ltd (ASX:CML) continues to progress the agreement to acquire Green Critical Minerals Pty Limited (GCM) which holds rights to acquire up to 80% of the McIntosh Graphite Project, Australia's third-largest ASX-listed graphite project.
The acquisition of GCM is conditional upon, amongst other things, approval by CML’s shareholders.
CML has engaged BDO Corporate Finance to prepare an independent expert’s report and it expects a notice of meeting (including the independent expert’s report) to be sent to shareholders within the next two weeks and for the shareholder meeting to be held in September 2022.
“A particularly valuable opportunity”
The McIntosh Graphite Project is well advanced, holding a JORC resource of 23.8 million tonnes contained graphite, 81% of which is in the higher confidence indicated category, with more than 40,000 metres of targeted drilling and extensive metallurgic test-work completed on the project to date.
CML believes the McIntosh project offers a particularly valuable opportunity, having low impurities and low-cost, high-yield downstream processing attributes with the potential to produce high-quality graphite products in a diverse range of end-use markets.
Pre-feasibility study update
The McIntosh pre-feasibility study (PFS) released in 2017 was completed prior to high-value coarse flake endowment being recognised at McIntosh which sells for >US$1,300/t, instead, the focus was on creating a small flake size (US$900/t) to target the Purified Spherical Graphite (PSG) market.
The flowsheet used in the 2017 PFS took a high-value coarse flake size and pulverized it to a lower value small flake.
This resulted in higher energy costs due to excessive crushing and grinding in circuit (opex) and higher upfront capital due to excessive crushers in circuit (capex).
These key issues identified now present a significant opportunity to improve upon the positive NPV generated in 2017 by producing a higher value coarse flake product which then enables the targeting of the higher value advanced battery industry (~US$8,000/t - US$22,000/t) and nuclear industry (up to ~US$30,000/t).
Exploration activities
GCM has appointed experienced geological consultants Apex Geoscience to prepare a comprehensive and extended exploration strategy for the McIntosh Graphite Project.
This will include:
- Review of geophysics templates and conduct further reinterpretation and/or reprocessing if required.
- Design a fieldwork program that includes mapping, rock chips and ground geophysics across multiple exploration prospects which has now been expanded to other targets, not just Marlin as previously announced.
- Plan an extended drilling program now across other multiple prospects including Marlin which will more than double the expected metres to be drilled with a combination of RAB, RC & Diamond.
- GCM is in the process of applying for an EIS government co-funded grant for the Marlin prospect which would contribute 50% of drilling costs up to $220,000.
As a result of the expanded exploration program, CGM’s proposed drill program is expected to take place in April 2023, rather than September 2022 as announced on 21 July 2022.