The folks at Northern Graphite (NGC in Canada) are one of two graphite developers in the western world seen as super-advanced stage in terms of a project (Bissett Creek). As in: ready for project financing. The other mine developeris Stratmin Global Resources (UK: STGR). Then you have Mason, Europe's Flinders Resources (FDR in Canada) and a few others -- one called Energizer Resources out of Madagascar -- in pre-feasibility land. And no, I do not own any of these. Northern Graphite deserves a look at the current price. The project looks real and economic, if and when it reaches production in two to three years. I am told Bissett Creek will do $2o million yearly of cash flow or more with an initial $100 million investment. This is according to a study that its principals can bring to the bank, also known as a BFS. I have not seen Bissett Creek. One of the mining analysts at Industrial Alliance Securities, Kiril Mugerman in Montreal, might have penciled writing on the wall more than a month ago about graphite hype. The folks at Northern Graphite told their shareholders the other day in a letter that actually had formidable data: "We believe the macro economic outlook for graphite is very compelling. The Chinese government has ordered up to 55 graphite miners and processors in Shandong province to stop production for environmental reasons. This represents over 20% of Chinese and over 10% of world flake production. Chinese flake production had already dropped 37% in 2012 as uneconomic mines were closed. ... The other major flake producing region in China is Heilongjiang, which is over 1700km from the coast and closes down in winter due to severe weather. The world depends on China for 70-80% of its graphite supply." Flake in, flake out. THE CALANDRA REPORT: Subscribe Thom Calandra@thomcalandra Telephone: 1 415 971-5*** melt-ups@thomcalandra.com
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