EDITOR: | February 7th, 2014 | 6 Comments

Study concludes that Zenyatta’s hydrothermal graphite is a ‘special and rare’ find

| February 07, 2014 | 6 Comments
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imagesFBDNJX8UToward the end of 2013, Zenyatta Ventures indicated that it had estimated that its high quality graphite deposit from the Albany project in central Ontario had a potential of 45 million tons. In 2014, Zenyatta will proceed with an economic feasibility study and while many stages will have to be completed before reaching the actual production stage, the company remains very enthusiastic about the project. The enthusiasm is not based on wishful thinking about eventual high grades of graphite, opening its product to a wider variety of industries. In fact, that has already been demonstrated. Rather, Zenyatta keeps on observing and proving that it sits on a very exclusive and possibly unique graphite deposit. Indeed, graphite is a very generic term and the term encompasses many different varieties of mineral. Zenyatta (TSXV: ZEN | OTCQX: ZENYF), this week, reported that ongoing geological research at Lakehead University in Thunder Bay on the Albany graphite deposit has shown a very unusual formation with evidence of igneous hydrothermal processes.

This origin is what the study has attributed for the superior purity and crystallinity of Zenyatta’s graphite. Canada’s Natural Sciences and Engineering Research Council (NSERC) will contribute to more study of the Albany deposit by Dr. Andrew Conly (associate professor, Department of Geology at Lakehead University); Zenyatta has also received support from the National Research Council of Canada Industrial Research Assistance Program for metallurgical testing. The Lakehead study has provided the first geological model of the Albany graphite deposit, proving that the deposit was formed through “igneous hydrothermal processes that give the graphite superior purity and crystallinity”. Dr. Conly noted that “Zenyatta has discovered a unique sub-class of a hydrothermal graphite deposit unlike any other. Igneous breccia-hosted graphite deposits like Albany are very rare, and ….none is currently being mined or even in an advanced stage of exploration globally”.

Why should graphite end users and investors, indeed the scientific and technical communities at large, care about the scientific interest that surrounds Zenyatta’s Albany deposit? Simply put, it shows that Zenyatta is truly sitting on a special and rare find and that it is not just making empty claims. Zenyatta has proven beneficiation results from samples of its graphite that have shown purity levels higher than the highest carbon levels normally noted in natural graphite (70-99%). For investors, this degree of purity means that Zenyatta can command very high prices and the market, also because its results put in on par with synthetic graphite, which is far more costly in both financial and environmental terms. Zenyatta’s graphite is of the ‘Sri-Lankan’ or vein variety, which is very rare and named because it was first identified in Sri Lanka at the Bogala mine. Outside of Sri Lanka, Zenyatta is but one of the very few properties of a comparable mineral. Sri Lankan graphite is reputed to show the best crystalline properties of all graphite varieties and it is can be adapted to various applications from electric motor brushes to automotive brake pads and clutches in purities reaching 99%.

Few if any other deposit can boast such qualities because, in fact, there are different categories and different qualities of graphite deposits:

  1. Amorphous graphite (microcrystal) is formed by the crystallization from organic carbon sediments (graphite content of ore 10-50 % and carbon purity between 70 to 85%).
  2. Crystalline graphite (vein or block) is in the form of massive veins (over 2 mm) of circular or other accumulations, most probably of hydrothermal origin (graphite content of ores from 88 to 99 % and carbon from 90 to 99 %).
  3. Flake or crystalline graphite (thin flat slats) is disseminated in siliceous and calcareous sediments metamorphosed as marble, gneiss and schist (graphite content of minerals from 80 to 99% and carbon 90 to 99%).

Graphite has several properties that make it an important mineral for the development of future technologies. It is able to conduct electricity extremely well because its carbon layers are made up by highly delocalized electrons. Third, it has thermal and acoustic capabilities. Finally, it has impressive dry lubricant and self- lubricating characteristics, which generates demand in many industries.

So far, because of limited purity, natural graphite has more commonly been used to make steel, refractories, expanded graphite, foundry facings and lubricants. Synthetic graphite, on the other hand, is often used in the electrodes, neutron moderators, reinforced carbon-carbon products, such as golf clubs, carbon fiber, fishing rods, bicycle frames, aerospace and special automotive parts. Zenyatta’s market advantage is that its demonstrated purity levels allow it to compete with synthetic graphite. The Lakehead study suggests that “the highest quality material of ultra-high purity (>99.95% C) graphite will demand a premium price in the range of $5,000 – $25,000 per ton depending on the application”.

Graphite has attracted many investors’ attention lately because it is a crucial substance for the advancement of several key technological sectors from electronics and batteries to aerospace and industrial metallurgy. Graphite is also the base from which graphene, the new wonder material is derived; because of this association, many investors might consider graphite to be a niche material with a niche market. Graphite’s high technology applications can sometimes obscure the fact that graphite has other and more ‘pedestrian’ applications that are also very important, especially in the emerging industrial sectors of south Asian economies.

Vein graphite (the kind found at the Albany deposit) is reputed to show the best crystalline properties of all graphite varieties and it is can be adapted to various applications from electric motor brushes to automotive brake pads and clutches in purities reaching 99%. However, graphite’s demand and value have mostly been driven by the fact that it is an important component of a crucial energy storage device: the lithium-ion battery. Laptops, smart phones and electric cars such as the Tesla-S all derive their power from batteries which feature an anode made entirely with graphite. Most of this graphite is synthetic and natural flake, mined, graphite accounts for only 5% of global demand for batteries. As natural graphite producers such as Zenyatta start to come into production they will help boost demand, to the point where natural graphite demand will match or exceed demand for synthetic graphite before the end of this decade.

Synthetic graphite is a material made from petroleum. Until recently, it has been used for specialty applications because of its superior consistency and purity (+99%) than natural graphite; manufacturers have therefore preferred it because it was able to offer higher reliability and performance, even if its price has been at least two or sometimes three times higher. Natural graphite is much cheaper and environmentally responsible than synthetic.  Synthetic graphite is derived from high temperature processes involving calcined petroleum coke and coal tar pitch. Synthetic graphite will continue to dominate for the next few years in current applications requiring high purity, while available natural graphite production will be preferred for the manufacturing of refractories for the steel industry and lubricants, such as those used in the aerospace sector to facilitate movement of actuators and flaps.


Editor:


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Comments

  • J. Best.

    Hmmmmm. Wondered why these guys trade at a couple of bucks while the counterparts are well under a dollar. Great article, good info and one hell of a resource it seems. Will be watching ZEN.

    February 7, 2014 - 3:11 PM

  • Paolo

    Hearing ZEN BOD having discussions with potential buyout offer. Several non disclosure agreements signed, and it’s confirmed ZEN cannot disclose any info as the well know global corporation doesn’t want to tip hat to competitors.
    The recent N43-101, and more recent news clarifying the significance and distinguishing their unique find, has kept this stock at $2, whereas all the other juniors are penny stocks, and a total different type of graphite.

    I believe, as we near PEA, in Q2, the majors players/ funds wanting in, will have less of a window to buy what is rumoured and calculated to be a $10-20 buyout price.

    February 7, 2014 - 4:16 PM

    • bingo1010

      even at a $20 buyout , people will look back in 5-10 years and say that it was the deal of the century, the applications of this stuff is just beginning!!!

      February 12, 2014 - 10:30 AM

  • Robert Baker

    Read the article again. You didn’t get it the first time. Waiting to buy may be a mistake. It will not be $2 much longer. The volume is already drying up. Rare, unique, one of a kind, ultra-high purity, all for $20??? I don’t think so!!!

    February 12, 2014 - 11:25 AM

  • Sue Glover

    Congratulations to the entire Zenyatta team, Zenyatta Awarded Top Performing Company on TSX Venture (Mining) for Second Consecutive Year – See more at: http://investorintel.wpengine.com/graphite-graphene-news/zenyatta-awarded-top-performing-company-tsx-venture-mining-second-consecutive-year/#sthash.ljDDyLgB.dpuf

    February 12, 2014 - 2:43 PM

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