Hi
@rett ;
http://www.mrltd.com.au/attachments/article/127/20150821-MRLReasearch-FEC.pdf
This has the conservative figures and Base Cases for you
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MRL is becoming a true Graphene producer; their are very important reasons for this. SL Vein is the best graphite in the world. It is one of the top Strategic Materials in the world.
There are many good discussions about Graphite ...
Recently I gave these examples...
http://static1.squarespace.com/static/52efc154e4b0c6787ab52ec3/t/557e979be4b00198d21b8ab8/1434359707626/Graphite DislocationV1.pdf
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http://www.mrltd.com.au/attachments/article/127/FEC-Graphene-20150831.pdf
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AM: It's similar to what a lot of other companies are trying to do, and that is show that their material can be used in specialist markets. Most graphite juniors must now prove they have a viable blueprint for their material in the value-added markets, where there are much higher margins. Those are the growth areas.
SM: There are two paths to success in graphite: the volume route or the value-added route. If you get caught in the middle, that's a problem.
AND
TGR: Please share one tidbit for investors to keep in mind as they conduct their due diligence on critical minerals equities.
SM: Don't treat critical minerals like commodities. The basic process of analyzing commodities has relevance to specialist minerals but they're not entirely the same. Critical minerals are niche products at this stage that require a long-term outlook. It is no surprise that the people that invested in the critical minerals supply chain in the past—namely Japanese and Korean companies—are long-term thinkers. These companies now control the majority of these supply chains. A longer-term way of thinking is crucial.
SOURCE: http://www.mining.com/web/thinking-...tment-primer-for-lithium-cobalt-and-graphite/
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The Gold Report: In a recent Benchmark Mineral Intelligence report, "
Mineral Supply Chain Visibility: Impact of Disruptive Technologies on Critical Raw Materials," you make the case that supply chain visibility will become increasingly important in the critical minerals space. Please briefly explain why.
Simon Moores: We've noticed that during the rare earth element bubble in 2010–2011, people didn't know what these niche minerals that go into everyday critical technologies were or where they were sourced. We've seen that knowledge grow in the last five years and downstream companies like
Apple Inc. (AAPL) and
Tesla Motors Inc. (TSLA) are now aware of what the raw materials are and where they come from.
Awareness in these niche minerals of growing importance, such as graphite, lithium and cobalt, is now occurring throughout the supply chain and not just in the upstream portion with the mining or processing companies. The downstream companies are paying attention and they buy the raw materials to manufacture these disruptive technologies. Supply chain visibility is rising.
Andrew Miller: Supply chains are going to become increasingly important. As these new technologies rapidly develop, both traditional industrial end users and newer high-tech buyers of these raw materials need to know more about the global supply pattern—factors that can impact their business. It's basic risk management in today's world.
They can't just rely on their traders or distributors for intelligence. End users are now aware of the need for a more global, independent picture on supply, demand and prices.
TGR: Is that happening?
SM: We haven't seen companies completely change their raw materials buying patterns yet, but some are preparing for it. In the U.S., the Conflict Minerals Act was the first time specific political restrictions have been put in place for these minerals in the West for ethical reasons. Europe will introduce similar legislation early next year.
The industry will have to start thinking about buying from reputable suppliers that meet certain standards. That means that end users may no longer opt for the lowest-cost source of raw materials from places like China and Democratic Republic of the Congo (DRC) if producers in these regions don't fall in line with environmental or ethical rules. And that is key. It's not just about price anymore. It means people will start paying a premium for more ethically sourced raw materials.
TGR: In the same Benchmark report you suggest that disruptive technologies are the most important new market for critical minerals. What are disruptive technologies and what are two or three specific ways these technologies are changing the markets for critical minerals?
AM: Disruptive technologies are completely new markets that are creating new value chains, products such as smartphones, electric vehicles and different types of energy storage. Growth in these new markets are affecting not only their own supply chains, but also those of existing industrial markets that rely on the same raw materials.
In the longer term there will be a real need for new critical mineral supply to come onto the market. In many cases that's also going to require suppliers to become more flexible. It's not just the production out of the ground that's going to have to increase; the refining and processing capabilities have to improve and expand too. The material required by traditional critical minerals markets is quite different and more tailored from the majority of product that is needed in these new high-tech spaces.
TGR: So companies developing these critical minerals projects not only have to get these elements out of the ground, but then they also have to process them in such a way to meet the specific requirements of these new end users, which can vary greatly.
SM: That's right. The grades that the critical minerals sector has traditionally served up and that have become industry standards over the past few decades are now changing, and that's why critical minerals like
lithium, cobalt and graphite aren't really commodities. They can't be mined out of the ground in large volumes and directly used; they are tailored specifically for the end user.
With commodities it is more of a logistics game, with critical minerals is a processing game—this is where they are fundamentally different.
TGR: And that is often without any firm commitment from the end users.
Is the traditional offtake deal dead in the critical minerals market, at least in specific cases?
SM: Offtake deals are familiar financing methods for resource companies, but it's difficult to apply that model to these minerals, which are specialist products.
Critical minerals are not usually traded in the volumes that offtake contracts often serve, like, for example, iron ore. If these markets grow to reach huge volumes in the future, perhaps then they will be traded in the same way as large-scale commodities.
SOURCE: http://www.equities.com/editors-desk/stocks/energy/3-ways-commodity-investors-can-play-the-tech-boom
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Strategic Materials have Unique Properties: SL VEIN GRAPHITE
End users are very important when considering the differences between Flakers and Veiners...
Vein can be used by Lithium Batteries/Graphene Chips and so on demanding a premium price.
Vein has not had its great strike yet by most estimates using modern methodology.
Vein separates itself because of costs and expenses.
In this age of bubbles and inefficiencies. In my opinion the balance sheet must be taken on a case by case basis as much as possible. Structure is vital at this stage of the game as well as managements ability to use best practices day to day...
1/ Vein is Cheaper and Faster to Market.
2/ Vein End-users can take it as it is without processing.
3/ Vein competes with China.
4/ Vein is involved with the matters of future global dominance of space, military, information technology, energy and transport.
5/ Vein is a niche market.
6/ Sri Lanka's Risk to Leverage ratio is in the positive.
7/ Leverage and risk minimizing aspects driving ever greater investment capital.
It is helpful to compare the Flake versus Vein Market place to gain the proper understanding of the Value and Price.
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1/ The U.S.A. is a 100% importer of Graphite, and has recently joined China and the European Union in classifying Graphite as a critical strategic material. This has far reaching consequences in my opinion.
2/ A further 344km2 are currently under application for licence. Assets are value.
3/ Very little upgrading and processing is required to make a high-quality saleable product with Vein Graphite.
4/ Vein graphite is the rarest, most valuable form of natural Graphite. A true safe haven commodity. The Vein Graphite difference from flake is its crystal structure, the end-users use it in specific applications, it is the most competitive with China.
5/ Large tons of graphite don't actually impress as much as you might think. Finding buyers for all those tons is a massive hurdle.
6/ Smaller projects that hit revenue targets are intrinsically valuable. MRL has set sound, achievable targets and that extrapolates into revenue targets.
7/ Supply shortages are to be expected by 2020. A predicted shortage of 100k to 130k tons per year as demand by the BRIC nations expands.
8/ End-users purify lower-grade graphite in-house to save costs and to pay mines less.
9/ End-users are starting large volume buying again after the 2012 dip.
10/ Graphiters are quicker to market all round beating out base and precious metals.
11/ It is easier for small companies to adapt and change to meet their end-users product specifications, allowing them to set the higher price. Larger companies often have invested in one set of specifications and find the costs of changing exorbitant.
12/ Vein Graphite is special, many graphiters face large metallurgical processing costs the Vein does not have. Low cost plays a part whether or not to invest long or short. If the costs are high that has to weigh upon decisions because delays snag up confidence.
13/ MRL can keep capital costs low, this is very important to see in the budget and the management. Paying in shares to keep the management strong is one of the best ways to keep down capital costs. Another is mining in an emerging nation with tax and currency advantages.
14/ Vein graphite is a niche market supplied only by Sri Lanka. Graphiters are at the mercy of the End-users because they have specific requirements from their input material to their finished product and any change to the production line costs. End-users favor smaller tons of Graphite that meet their needs and will favor MRL for that alone.
15/ MRL is not beholden to anyone but the shareholders, they have excellent kingmakers CPS Group Capital and can make JV's and deals with End-users early on in the exploration, mining and shipping steps that they must take.
16/ Whenever low-cost production can be sold at the premium without delays revenue follows.
IRR - Internal Rate of Return....
Small consistent tons allows for one single customers. Multiple customers multiple headaches.
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Source: http://www.mrltd.com.au/attachments/article/136/20150513-GrapheneResults-FINAL.pdf
1/ High Quality / Low Defect Graphene
2/ Independently Confirmed
3/ Run Of Mine ORE
4/ Spherical Graphite for Lithium Ion Batteries (Graphene Batteries as well obviously as well as all the other Tech Areas like Graphene Chips)
5/ Graphene Production: 1 Step Process
6/ Sold into Traditional and High Value Markets
7/ Unequaled by Graphite Projects in any other Country
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Assuming the Anticipated Positive Outcomes:
- On Going Drilling, Q4, High grade, deeper , wider the better;
- Test work results, Dec 14, Beneficiated to > 99.95% TGC. Spheriodisation results;
- Off Take, MOU agreements, Q4 14, Q1 15, Battery Manufacturers;
- Permitting at Bopitiya/Pandeniya. Production development Aluketi-ya, Q1 15, Commercial production within 3 months of ramp-up;
- Production at Aluketiya, Q2 15, Cashflow; and
- Further Acquisition, Ground based exploration, Ongoing, MRF’s thirteen other exploration projects.
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- Sri Lanka is one of the fastest growing economies with a GDP of 8% between 2010 and 2012
- The Sri Lankan government is promoting foreign private sector investment
- There is excellent infrastructure and experienced mining labour available
- The country is English speaking with a high literacy rate of >92%
- Sri Lanka is run by a democratic government, and is a member of the Commonwealth
- There is excellent exploration and mining tenure available
- Subject to Board of Investment approval to mine high grade vein graphite for export, MRL may receive:
- A tax free holiday period
- Duty free imports of capital equipment
- Streamlined repatriation of profits
Why Sri Lanka?
1/ Sri Lanka is the only region in the world that produces vein (lump) graphite with a carbon content of more than 90%C in commercial quantities.
2/ The 25-year civil war ended in May 2009.
3/ The Sri Lankan government is keen on promoting foreign private sector investment, with graphite being the country's one of most important mineral products.
4/ Sri Lanka is underlain by Proterozoic high grade metamorphic rocks with Phanerozoic sediments being restricted to the coastal region.
5/ Sri Lanka currently produces a very small amount of graphite about 4,000 metric tons (MT) yearly, according to the US Geological Survey (USGS).
6/ But Sri Lanka's graphite is a unique product. The country produces lump and chippy dust graphite and is the worlds only source of these particular materials.
7/ Lump and chippy dust graphite are the highest-value graphite products found globally, the USGS notes. In 2012, prices for Sri Lankan lump and chip graphite averaged $1,990 per MT, significantly higher than prices reported for other products, such as flake or amorphous graphite.
8/ The significant potential application of modern geophysical techniques. Electrical surveys are a simple and effective way to check large amounts of ground for graphitic targets. By looking at the under-explored ground around Sri Lanka's major mines, incoming explorers have a high probability of making significant finds.
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I hope this is good food for thought
This is the best summary of the basic data points I can gather - Good Luck in your Research.
Kind Regards
It is easy to be 100% Wrong!
DYOR !!!
