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The mining newspaper for Alaska and Canada's North
Will Alaska be America's source of this vital battery ingredient? North of 60 Mining News – February 1, 2018
The rising popularity of electric vehicles and stationary energy storage products are increasing the demand for graphite, which is used as an anode material in the lithium-ion batteries that power them.
This core is from a 2012 hole drilled through a lens of the large-flake graphite at the Graphite Creek project on the Seward Peninsula.
An outcropping graphite lens at the Graphite Creek project north of Nome, Alaska.
Graphite is among the 23 metals and minerals the U.S. Geological Survey deemed critical to "the national economy and national security of the United States" in a December report, "Critical Mineral Resources of the United States – Economic and Environmental Geology and Prospects for Future Supply."
One of the reasons the USGS considers graphite critical is the growing demand of this mineral as anode material in the lithium-ion batteries that power electric vehicles and a rapidly expanding number of personal electronic devices.
The other major factor playing into graphite's criticality it that the U.S. is fully reliant on foreign countries for its supply of this battery ingredient.
According to USGS' annual report, "Mineral Commodity Summaries 2017," there are currently no domestic sources of the graphite used in the United States, which resulted in domestic manufacturers looking abroad for the roughly 39,500 metric tons of the carboniferous material used in the United States during 2016.
China is by far America's largest graphite supplier, followed by Canada, Brazil, Japan, Mexico and Madagascar.
USGS sees a major spike in U.S. demand for graphite when Tesla Motor's Gigafactory, an enormous lithium-ion battery facility being constructed in Nevada, is fully operational.
"The plant's completion was originally projected for 2020, but the project is about two years ahead of schedule," USGS penned in the early 2017 report. "When the plant is complete, it will require 93,000 tons of flake graphite to produce 35,200 tons of spherical graphite for use as anode material for lithium-ion batteries."
The Kigluaik Mountains on the Seward Peninsula in western Alaska hosts at least one deposit with the size and grade to meet America's growing need for graphite in lithium-ion batteries but there are questions as to whether it is too far off the grid to be economically viable.
"The graphite flake deposits in the Kigluaik Mountains graphite district, Alaska (Coats, 1944) represent the largest known domestic graphite resource, but are located in a rugged and remote area with high mining costs," USGS penned in its 2017 critical minerals report.
Vast Graphite Creek
The Graphite Creek property about 35 miles north of Nome hosts an enormous, surfacing deposit of graphite that spans some 11 miles of the Kigluaik Mountains.
Though Graphite One Resources Inc., the company working to develop a mine at Graphite Creek, has only systematically drilled a small section of the near-surface mineralization at this vast western Alaska graphite project, the Vancouver B.C.-based company has outlined a deposit that could provide a healthy domestic supply of this critical battery ingredient for decades.
A resource estimate calculated early in 2017 outlines 744,000 metric tons of graphite in 10.32 million metric tons of indicated resource grading 7.2 percent graphitic carbon; plus 4.7 million metric tons of graphite in 71.24 million metric tons of inferred resource averaging 7 percent for the subsection of Graphite Creek being considered for initial mining.
In addition to size, the graphitic carbon at Graphite Creek has unique characteristics that make it ideally suited for being refined into the coated spherical graphite that is used in the lithium-ion batteries that power electric vehicles.
Carbon-coated spherical graphite is the finished product used in lithium-ion batteries. The spherical shape allows the graphite to be more efficiently packed into battery cells, while the coating extends the graphite's lifetime capacity.
TRU Group Inc. – a technology metals consultant with expertise along the entire graphite-graphene supply chain – identified characteristics of the Graphite Creek deposit that may make the material a good fit for many of the high-tech and green energy sectors that are driving a large part of the growing market for graphite.
The graphite specializing consultant postulated that these distinctive characteristics could lend to different specialized applications with minimal processing.
Graphite One has coined the acronym STAX to describe these unique and naturally occurring properties.
"From the time we identified the unique mineralization of our STAX graphite, we've observed a number of potential performance advantages," said Graphite One CEO Anthony Huston.
Domestic graphite producer
Establishing that the Graphite Creek deposit has both the size and graphite characteristics to be a domestic source of graphite for lithium-ion battery anodes, Graphite One completed a preliminary economic assessment for the project early in 2017.
This PEA outlines plans for a roughly 2,800-metric-ton processing facility at Graphite Creek that produces 60,000 metric tons per year of graphite concentrate. This concentrate would be shipped to an advanced material processing facility that is anticipated to refine these concentrates into 41,850 metric tons of coated spherical graphite and 13,500 metric tons of purified graphite powders annually.
Together, the mine and processing facility are known as the Graphite One project.
"This PEA shows the strong potential of our project as America's emerging producer of lithium-ion battery-grade coated spherical graphite," said Huston.
"With the prospect of a low-cost, 40-year mine life using half of the identified graphite mineral resources and, given our projected production costs and conservative pricing assumptions, we are confident that Graphite One has the potential to become a reliable provider of graphite materials critical to clean-tech, high-tech and national security applications," the Graphite One CEO added.
Tapping AIDEA's expertise
Graphite One is hoping to find a place in Alaska to set up the advanced material processing facility.
To help with this search, the company entered into a memorandum of understanding with the Alaska Industrial Development and Export Authority to find an Alaska locale with reasonable power costs and adequate supply, industrial zoned land, close to tidewater and port facilities, and infrastructure that allows easy access for the workers needed to operate the facility.
In a May report, AIDEA identified four Southcentral Alaska locations – Homer, Kenai, Port Mackenzie and Seward – that meet the criteria and "are very interested in discussing this project with Graphite One management."
The quasi-state-owned development said Alaska has advantages that could outweigh the high-cost of power at these sites, compared to sending the concentrates to the Lower 48 for further refinement.
"While Outside locations may provide cheaper power costs, Alaska is a mining and industrial friendly state that supports the development of value-added activities, and has a regulatory regime that supports responsible development while being less costly than other potential Northwest locations," AIDEA penned in the preliminary report.
Producing a significant portion of the coated spherical graphite needed for America's growing lithium-ion battery sector from Alaska mined ore would make the Far North state a domestic hub for this increasingly important critical mineral.
"Tapping AIDEA's expertise in helping us assess potential refinery sites is the first step towards making Alaska a key player in the clean-tech energy sector," said Huston. "The AIDEA report confirms the considerable interest Alaska localities have in serving as a base for our advanced-material spherical graphite refinery."
Critical executive order
The USGS report listing graphite among the metals and minerals critical to America's economy and security, coupled with President Donald Trump's issuance of an executive order calling on federal agencies to devise a strategy to ensure America has a reliable supply of critical minerals, is adding to the growing national awareness of the proposed Graphite One project.
"The report and President Trump's executive order track with the ongoing discussions our team has been having with key U.S. officials at the federal level and the state of Alaska, with interest far more intense now than our initial discussions five years ago," said Huston.
If future feasibility-level studies continue to show that developing the Graphite One mine and refinery are economically viable, critical mineral strategies ordered by President Trump could help the project developed quicker.
In particular, the order's call for federal agencies to come up with recommendations to streamline permitting and review processes in order to improve access, discovery, production and refining of critical minerals in the United States could help reduce the time it takes to bring Graphite One online.
"This executive order will prioritize reducing the Nation's vulnerability to disruptions in our supply of critical minerals safely and responsibility for the benefit of the American people," said Trump.
Editor's Note: "Critical Minerals Alaska – Graphite" is the first of a series of articles to be published in North of 60 Mining News that investigates Alaska's potential as a domestic source of minerals deemed critical to the United States. At least 15 of the 23 critical minerals identified by the U.S. Geological Survey – antimony, barite, beryllium, cobalt, fluorspar, gallium, germanium, graphite, indium, platinum group elements, rare earth elements, rhenium, tantalum, tellurium, tin and vanadium – are found in Alaska.
Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.
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