big north graphite may 2013
TRANSCRIPT
1 TSX – V NRT
Discovering Graphite Opportunities in Canada & Mexico
May 2013
Cautionary Note Forward-‐looking statements Certain statements contained herein cons/tute “forward-‐looking statements.” Forward-‐looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-‐looking statements may include words such as “plans,” “intends,” an/cipates,” “should,” “es/mates,” “expects,” “believes,” “indicates,” “targe/ng,” “suggests,” “poten/al,” and similar expressions. These forward-‐looking statements are based on current expecta/ons and entail various risks and uncertain/es. Actual results may materially differ from expecta/ons, if known and unknown risks or uncertain/es affect our business, or if our es/mates or assump/ons prove inaccurate. Investors are advised to review the Company’s Annual Informa/on Form filed at www.sedar.com for a detailed discussion of investment risks. The Company assumes no obliga/on to update or revise any forward-‐looking statement, whether as a result of new informa/on, future events or any other reason. While Big North intends to re-‐start the Nuevo San Pedro mine, the Company has not established mineral resources and has not completed a valid mining study (as defined by NI 43-‐101) to support a produc/on decision. Historically, a produc/on decision under these circumstances results in much higher economic or technical risk. Furthermore, without a pre-‐ feasibility or feasibility study and a graphite reserve, there can be no assurance that opera/ons at Nuevo San Pedro will be profitable.
2 2
Management & Directors Spiro Kletas, President & CEO, Director – Over 10 years experience in the financial industry with 7 years in
the public capital markets, working for several Toronto Exchange-‐listed companies in project procurement, corporate development and financing.
Dean Nawata, Director – Over 18 years of public market experience, nine of which he spent as a licensed stockbroker focusing on financing of junior mining and oil/gas projects with NesbiJ Burns, Research Capital and, most recently, Raymond James. Mr. Nawata currently holds a posiPon in Business Development for 49 North Resources and is a Director of Prima Fluorspar.
Andrew Rees, Director – Mr. Rees is currently President and CEO of WellStar Energy Corp. and sits on the board of directors of several publicly trading companies. Mr. Rees brings 15 years of public company experience having been involved with developing projects from concept to producPon. Mr. Rees has been directly involved in raising over $150 million for junior resource companies.
Eric Ostensoe P. Geo., Director -‐ Mr. Ostensoe is a consulPng geologist with more than forty years direct involvement with the mining and mineral exploraPon industries. Mr. Ostensoe supervises property exploraPon and development projects from "grassroots" to advanced stages and provides recommendaPons to management of junior and medium sized public companies.
Connie Norman, Corp Secretary
3 3
Capital Structure
• Issued & Outstanding 38.3 m • Warrants 15.4 m
• OpPons 2.5 m
• Fully Diluted 56.2 million
• Management & Insiders – approx 20%
4 4
Investment Highlights • Graphite supply Pghtening in an historically underexplored sector
• Projects located in geologically favorable, poliPcally stable jurisdicPons
• Aiming to accelerate re-‐start of Nuevo San Pedro amorphous graphite mine in Sonora, Mexico
• Amorphous graphite accounts for 55% of natural graphite market and over 90% of producPon was out of China in 2011 – Big North is only TSX.V company pursuing amorphous graphite
• Aiming to be one of the first junior companies to produce Graphite
6 5
Sonora Mexico Properties • Big North acquired 3 past producing graphite mines in Sonora, Mexico -‐
La Fortuna, Caraples and a 50/50 JV in the Nuevo San Pedro Graphite mine. • Nuevo San Pedro mine in the process of being re-‐started: Big North Graphite to
accelerate the start-‐up process.
• Nuevo San Pedro is approx 1km away from the La Lourdes graphite mine, which has been operaPng for 50 over years
• Approx. 50 km SE of Hermosillo, a city of 1 million people
• Approx. 10 km East of a rail line with direct access to the port of Guaymas
• Area of good infrastructure and access
• Sonora Mexico has produced graphite for over 100 years
• Pursuant to the terms of the agreement, a 100% interest will be acquired in Grafito Barranca, which owns the 50/50 JV in NSP mine and 100% of Akiwiki claims (Less 3% NSR)
6 6
Sonora Mexico Property Map
7 7
• Nuevo San Pedro is an approximately 11 hectare property. It is a past producing mine, which is in the process of being restarted.
• Aki Wiki consists of approximately 145 hectares.
• Aki Wiki is located approximately 1.5 kilometers south of the historic El Cochi graphite mine. There are two past producing mines on the property, La Fortuna and Caraples.
Buying and Processing
April 22, 2013 NR: Big North … announces that, as part of the Company's business plan, the Company has
started buying amorphous graphite from local private producers who do not have processing capabiliPes. Big
North has recently acquired approx 100 tons of amorphous graphite in an unprocessed form from two local
miners. Big North plans to purchase graphite from local producers to supplement potenPal producPon from the
Nuevo San Pedro project. The Company plans to process the purchased graphite to the specificaPons of future
customers and re-‐sell the purchased graphite at market prices, capturing the difference in prices.
Increase “producPon” without the tradiPonal risks of mining
Many small family run graphite mines without processing ability
Minimum grade requirement
Capture the difference on pricing, minus processing and transport
8 8
Amorphous Graphite • Global graphite producPon was 1.2 million tons in 2011, approx 55% of which is amorphous
graphite. • The United States, Europe and China have included graphite among the short list of criPcal
metals • The UnPed States produces no graphite and is 100% dependent on imports to meet it's
industrial and technology needs. • China produces 70%-‐80% of the world’s natural graphite. China produced over 90% of
world’s amorphous graphite in 2011 • ConPnuing government-‐backed consolidaPon programs in the Hunan Province is seeing over
230 mines reduced to 20 • The consolidaPon of China's amorphous graphite industry is set to impact the supply/
demand balance for 2012 and 2013 and will result in a loss of global supply • Amorphous graphite sells for $350-‐800/ton depending on the carbon content which ranges
from 65% to 85%+ • Amorphous graphite producPon is dominated by China, with approx 16K tpa from Austria,
12K tpa from Mexico and 300 tpa from Turkey • Amorphous graphite is mainly used as a component in lubricants, refractories, steel
producPon, brake linings, clutch materials, gaskets and water-‐based paints
*Source: Industrial Minerals
10 9
Griffith/Brougham Graphite Properties - Ontario
• Approximately 6,500-‐hectare land posiPon in central southeastern Ontario
• High value, high quality large-‐flake graphite exploraPon target
• In an area of well-‐established access and infrastructure
• ProperPes cover substanPal tracts of graphite-‐prospecPve Grenville-‐age marble +/-‐gneiss geology and are unexplored for graphite using modern technology.
• To the southeast, the Brougham Graphite Property is anchored by two historic graphite occurrences (based on Ontario Geological Survey maps from the 1970's)
• EM survey completed July 2012
• NI43-‐101Technical Report released Oct 2012
• Phase 2 ExploraPon Q2 2013
10 10
Griffith/Brougham Property Map
11 11
Grand Lac du Nord Property - Quebec
• Approximately 2,009 hectare land package • Located approximately 140 km NW of Sept-‐Iles, by road • 8km x 2km graphiPc paragneiss formaPon
• Similar geology to other graphite deposits and mines in Quebec, such as Focus Metals Inc.'s Lac Knife deposit, Timcal Graphite and Carbon's Lac des Iles mine.
• Originally explored by SOQUEM (2000/2001)
• Phase 1 ExploraPon completed -‐ confirmed a mulPple graphite bearing structure covering an area approximately 4 km by 2 km with results of up to 5.31% Graphite in grab samples
12 12
Grand Lac Du Nord Property Map
13 13
What is Graphite?
• CriPcal supply industrial metal
• One of two natural carbon polymers (diamonds) • Light weight with highest natural
strength and sPffness of any material • Conductor of heat/electricity • Corrosion and heat resistant • High natural lubricity
14 14
Graphite Uses • Automotive Industry & Steel Industry
– Largest users of graphite with demand growing 5-‐7% annually
– Brake linings, gaskets, clutch materials – liner for ladles, crucibles, component in
bricks which line furnaces and to increase carbon content of steel
• Lithium Ion Batteries – uses in portable consumer devices such as
laptops, cell phones, MP3 players, digital cameras, power tools
• Pencils, lubricants, fire retardants and reinforcements in plastics
15 15
Graphite Major End Uses
41%
14%
14%
11%
10%
10% Steel & Refractories
AutomoPve parts
Lubricants
Carbon Brushes
BaJeries
Other
Source: Merchant Research & ConsulPng (2011) 16 16
Supply/Demand Dynamics • Industrial demand growing 5% per annum over last 10 years due to
industrializaPon of emerging economies such as China and India • European Union and USA named graphite a mineral in criPcal supply
• Lack of exploraPon and development over last 20 years and China producing +70% of the world’s graphite
• Chinese producPon and exports expected to decline due to China’s strategy to keep value added manufacturing in the country
• Graphite market is more than 40 Pmes larger than lithium and rare earths markets
• Demand for graphite increasing globally for green technology applicaPons which have potenPal to consume more graphite than all current uses combined
Source: Industrial Minerals, Supply Situa*on Report: Graphite demand soars above pre-‐crisis Levels, April 2011 17 17
Graphite Global Demand
Source: Industrial Minerals Magazine 18 18
Key Milestones Big North Qualified-‐ Dec 2011 Acquired First graphite asset -‐ March 2012 Strategic AcquisiPon of addiPonal assets – April/Sept 2012 Commence ExploraPon on Canadian properPes -‐ May/June 2012 AddiPons to Management, OperaPonal and Technical Teams -‐
June/July 2012 and ongoing AcquisiPon of past producing Assets in Mexico -‐ Sept 2012 Close acquisiPon of Mexico properPes – Nov 2012 Start assembly of processing plant Accelerate re-‐start of Nuevo San Pedro Mine -‐ ongoing Commence test mining of amorphous graphite in Mexico Amorphous graphite offtakes/sales agreements ConPnue exploraPon of Canadian properPes
19 19
Contact Info:
Spiro Kletas, President & CEO [email protected] [email protected]
www.bignorthgraphite.com Big North Graphite Corp.
Suite 350 -‐ 885 Dunsmuir Street Vancouver, BC
V6C 1N5 604.629.8220 (Office)
20