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NRT.V PresentationTRANSCRIPT
1 TSX – V NRT
Discovering Graphite Opportunities in Mexico & Canada
Jan 2014
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.
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Management & Directors v 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.
v Cesar J Guajardo, Director – Has 18 years of experience in the graphite business. He is the former owner and Chairman of the Board of Grafito de Mexico SA de CV, a private company that formerly owned the El Tejon Flake Graphite Mine and Mill in Oaxaca, Mexico. Mr. Guajardo is a graduate of the Universidad de Nuevo Leon, and holds a degree in Industrial Engineering. Mr. Guajardo spent 22 years with Praxair Mexico and was the former Managing Director of Praxair Mexico for ten years.
v 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 NesbiW Burns, Research Capital and, most recently, Raymond James. Mr. Nawata currently holds a posiZon in Business Development for 49 North Resources, is President and CEO of Olympic Resources, CFO/Director of Red Star Capital Ventures and is a Director of Prima Fluorspar and Greywacke ExploraZon.
v 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 producZon. Mr. Rees has been directly involved in raising over $150 million for junior resource companies.
v Eric Ostensoe P. Geo., Director -‐ Mr. Ostensoe is a consulZng geologist with more than forty years direct involvement with the mining and mineral exploraZon industries. Mr. Ostensoe supervises property exploraZon and development projects from "grassroots" to advanced stages and provides recommendaZons to management of junior and medium sized public companies.
v Connie Norman, Corp Secretary
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Capital Structure
• Issued & Outstanding 55.0 m
• Warrants 28.0 m • OpZons 3.2 m
• Fully Diluted 86.2 million
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Investment Highlights • Producing, purchasing, processing and selling amorphous graphite
in Sonora Mexico • 760 tons sold to date (Aug – Dec 2013) • Amorphous graphite accounts for approx 50% of natural graphite
market and over 90% of producZon was out of China in 2012 • Big North is the only TSX.V company conducZng business in
amorphous graphite • Acquiring the El Tejon Flake Graphite Mine and Mill in Oaxaca,
Mexico • Goal to further near term cash flow by adding flake graphite
producZon and sales
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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.* • Started assembly of processing facility April 2013 • Started test mining May 2013 • First sale completed Aug 2013
• 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 • Approx. 50 km SE of Hermosillo, a city of 1 million people • Nuevo San Pedro is approx 1km away from the La Lourdes graphite mine, which has been operaZng for over 50 years
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Sonora Mexico Property Map
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• 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 News Release: “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
capabili/es. 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 poten/al
produc/on from the Nuevo San Pedro project. The Company plans to process the purchased graphite to the
specifica/ons of future customers and re-‐sell the purchased graphite at market prices, capturing the difference
in prices”.
ü Increase “producZon” without the tradiZonal risks of mining
ü Many small family run graphite mines without processing ability
ü Minimum grade requirement
ü Capture the difference on pricing, minus processing and transport
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Amorphous Graphite Stockpiles
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Graphite Stockpiles at Big North Graphite’s Processing Plant, Sonora Mexico
El Tejon Flake Graphite Mine and Mill
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• LOI signed Dec 2013 • Mexico’s only past producing flake graphite mine and floataZon mill • Closed due to graphite prices in 2002 • Ability to jump start – all infrastructure in place • Produces flake graphite (different uses than amorphous graphite)
• Cesar J Guajardo, Chairman of the private company that formerly operated El Tejon, joins the Board of Big North • He has 18 years of graphite producZon, processing and sales experience in Mexico
El Tejon Flake Graphite Mine and Mill
• 500 hectare property -‐ consists of the El Tejon flake graphite mine and mill • The El Tejon Property is located in the state of Oaxaca, approx 38
kilometers Northwest of the City of Oaxaca, in the town of San Francisco Telixtlahuaca.
• The El Tejon Property is the only flake graphite mine to have produced in Mexico.
• The mine and mill were originally built in 1980 by the Government of Mexico. In 1989, a second processing line was installed to increase the capacity to approximately 4400 tonnes per year of finished graphite.
• El Tejon was an open pit mine, and the mill was used to crush, mill, float, dry, screen and pack final product.
• Closed in 2002, due to low graphite prices. At the Zme of closing, approximately 80% of the graphite produced was sold to the USA.
• Historically, the mine produced approximately 20% large flake graphite and 80% medium and fine flake graphite.
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Griffith/Brougham Graphite Properties - Ontario
• Approximately 6,500-‐hectare land posiZon in central southeastern Ontario
• High value, high quality large-‐flake graphite exploraZon target
• In an area of well-‐established access and infrastructure
• ProperZes cover substanZal tracts of graphite-‐prospecZve 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
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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 graphiZc paragneiss formaZon • 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 ExploraZon completed -‐ confirmed
a mulZple graphite bearing structure covering an area approximately 4 km by 2 km with results of up to 5.31% Graphite in grab samples
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What is Graphite? • CriZcal supply industrial mineral • One of two natural carbon polymers (diamonds) • Light weight with highest natural
strength and sZffness of any material • Conductor of heat/electricity • Corrosion and heat resistant • High natural lubricity
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Amorphous Graphite • Global graphite producZon was 1.1 million tons in 2012, approx 50% of which is amorphous
graphite. • The United States, Europe and China have included graphite among the short list of criZcal
metals • The UnZed 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 2012. • “Supply security is a big concern” for amorphous graphite users • ConZnuing government-‐backed consolidaZon programs in the Hunan Province is seeing over
230 mines reduced to 20 • Amorphous graphite sells for $350-‐800/ton depending on the carbon content which ranges
from 65% to 85%+ • Amorphous graphite producZon 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
producZon, brake linings, clutch materials, gaskets and water-‐based paints *Source: Industrial Minerals
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Amorphous Graphite + Uses
• Amorphous graphite is actually not “amorphous” as all graphite is crystalline. It is microcrystalline or cryptocrystalline, meaning that the “flake” size is very small.
• Amorphous graphite is used in the refractories industry to manufacture crucibles, ladles, molds, nozzles and troughs that can withstand the very high temperatures associated with molten metal, parZcularly the casZng of steel.
• The electrodes used in many electrical metallurgical furnaces, including the electric arc furnaces used in steel processing, are manufactured from graphite. In the producZon of steel itself, graphite is used as a carbon raiser to strengthen steel. It is also used in blast furnace linings for the producZon of iron because of its high thermal conducZvity.
• Amorphous or fine-‐flake graphite is used in brake linings, gaskets and clutch materials.
• Foundry facing mold wash uses amorphous or fine-‐flake graphite in a water-‐based paint to coat the mold, thereby allowing ease of separaZon of the casted object from the mold auer the metal has cooled.
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Graphite Major End Uses
41%
14%
14%
11%
10%
10% Steel & Refractories
AutomoZve parts
Lubricants
Carbon Brushes
BaWeries
Other
Source: Merchant Research & ConsulZng (2011) 17
Supply/Demand Dynamics
• Industrial demand growing 5% per annum over last 10 years due to industrializaZon of emerging economies such as China and India
• European Union and USA named graphite a mineral in criZcal supply
• Lack of exploraZon and development over last 20 years and China producing +70% of the world’s graphite
• Chinese producZon and exports expected to decline due to China’s strategy to keep value added manufacturing in the country
• Graphite market is more than 40 Zmes larger than lithium and rare earths markets • Demand for graphite increasing globally for green technology applicaZons which have potenZal 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 18
Graphite Global Demand
Source: Industrial Minerals Magazine 19
Key Milestones ü Big North Completes Qualifying TransacZon-‐ Dec 2011 ü Acquired First graphite asset -‐ March 2012 ü Strategic AcquisiZon of addiZonal assets – April/Sept 2012 ü Commence ExploraZon on Canadian properZes -‐ May/June 2012 ü AddiZons to Management, OperaZonal and Technical Teams -‐ June/July 2012 and ongoing ü AcquisiZon of past producing Assets in Mexico -‐ Sept 2012 ü Close acquisiZon of Mexico properZes – Nov 2012 ü Start assembly of processing plant ü Accelerate re-‐start of Nuevo San Pedro Mine – ongoing ü Commence test mining of amorphous graphite in Mexico ü Amorphous graphite sales q Increase producZon, enhancing processing, growing sales and securing long-‐term ovake
partners q Move El Tejon project towards producZon
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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)
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