Energy Prospectus

I have arranged for an expert on the graphite market to speak at our January luncheons in Houston and Dallas. Why? Because graphite is used in rechargeable batteries and demand is soaring. Read this, from a recent report from UBS.
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UBS is bullish on the graphite and lithium demand.
By 2025, they expect the graphite market to grow by 1.7x as per their base case scenario or by 2.0x if the upside scenario plays out. For lithium, this is by 4.5x and 7.5x respectively. The graphite market today is much bigger than the lithium market. UBS evaluates it at $16.2B while it is $2.7B for lithium. They do not mention the proportion of each type of graphite in this total market value. One has to assume that $16.2B is thus the value of amorphous, flake, vein and synthetic markets together. The li-ion batteries, however, use a feedstock of a combination of natural flake graphite and/or synthetic graphite. As amorphous and vein graphite demand are not expected to grow, one can assume that natural flake and synthetic graphite demands will grow in a higher pace. In the case of natural graphite, the flakes need to be further purified, and both natural and synthetic need to be processed (shaping and coating) to produce anode material. Let’s look at this for a moment.

The world flake graphite market is roughly 450,000 tonnes on a yearly basis. The growth multiple of 1.7x on the total graphite market by 2025 looks conservative to me when we look at the combined li-ion battery capacity currently in construction or expansion around the world. We know that Tesla’s Gigafactory 1 in Nevada needs 50 GWh of li-ion packs as soon as next year. That will give Tesla enough batteries for a production rate of 500,000 cars. 50 GWh is 50,000,000 kWh.

The rule of thumb we use at Nouveau Monde Graphite (TSXV: NOU | OTCQB: NMGRF) is 1.2 kg of graphite per kWh, all li-ion chemistries combined. This type of graphite is the heavily processed anode material also known as coated spherical purified graphite (CSPG). Let’s keep things simple and let’s assume a yield of 50% from the feedstock of flake graphite when CSPG is produced. The math then tells us Tesla could consume up to 120,000 tonnes of new supply of flake graphite as early as 2018. Obviously, this will be split up with synthetic graphite but I think you get the picture. Tesla by itself can potentially generate a source of new demand of 26% with the Gigafactory1 running at 50 GWh as early as 2018. Musk also said they expect the total capacity of the fully completed Gigafactory1 to be 150 GWh at the pack level.

Read more: https://investorintel.com/market-analys ... -graphite/


Global Demand: https://economictimes.indiatimes.com/ma ... 269778.cms

According to a new market report from Credence Research, the graphite market is expected to be valued at over US$20.8 billion by 2023, expanding at a CAGR of 3.8 percent from 2016 to 2023.

Demand is expected to increase partially due to more buying from automobile and aircraft companies, but lithium-ion batteries are expected to drive the most growth. These batteries are used to power electric cars and more.

Lithium-battery factories skyrocketing on EV demand. The number of battery “megafactories” that are either in production or under construction around the world has jumped to 26, according to Benchmark. That compares to just 3 megafactories – factories with battery production capacity of at least 1 gigawatt-hour annually – that were in production or planned as of 2014.

I met with the CEO of this company on December 5 in Houston and asked him to speak at our January luncheons in Houston (Jan. 15) and Dallas (Jan. 16).

Saint-Michel-des-Saints, QUEBEC – December 4 2017 – Nouveau Monde Graphite Inc. (“Nouveau Monde”) (TSX‑V : NOU) is pleased to announce the completion of several milestones regarding the construction of its demonstration plant (“Demo Plant”). The significant achievements include; finalizing the Demo Plant engineering study, obtaining the financing and securing the authorizations and permits necessary for the completion of the first phase of the Demo Plant project. In addition, starting this November, Nouveau Monde has signed a short-term lease with Louisiana Pacific, owners of the building that will house the Demo Plant. The lease agreement includes access to a 40,000 square-foot area within the building. The Louisiana-Pacific plant is located 6 km from the West Zone of Nouveau Monde’s graphite deposit.

Project Advancement

Nouveau Monde recently completed an in-house engineering study on its Demo Plant in conjunction with independent engineering firms including, MET-Pro, SNC-Lavallin and WSP, as well as industry experts at Nouveau Monde, who have 30 years of cumulative graphite market experience. The team of experts was led by Karl Trudeau and Alain Mercier. This engineering study details the project’s strategy and implementation plan. The Demo Plant will have two years of service life and the annual production capacity of 1,000 tonnes of graphite concentrate including 250 tonnes of battery grade graphite. A 40,000 tonnes bulk sample, collected from the Matawinie graphite Propertie’s West Zone deposit, is expected to provide the ore necessary to feed the Demo Plant.

The bulk sample will be extracted from a 3,000m2 area of the West Zone. The deforestation and stripping of this area began in mid-November 2017. Other deforestation activities are planned in 2018 to clear land in order to provide the necessary work area, overburden storage as well as host the tailing site.

The first blast for the bulk sample is planned for spring of 2018. Blasting and subsequent transport of the ore is expected to occur during a five-day period at every three months over two years. The existing road network will be used to transport the ore.

The Demo Plant, which will include a complete natural graphite processing chain, aims to carry out a first transformation of the ore by liberating and concentrating the natural graphite flakes. Purchase orders for long lead processing equipment have been placed with the suppliers. This first phase of graphite concentrate production is planned for the summer of 2018. A second transformation of the graphite concentrate is also planned for a subsequent phase in order to produce value-added products such as purified spheronized graphite (SPG) and Anode Material (AM). Our experts are currently testing necessary equipment for value-added products with vendors and finalizing the flowsheet before a more precise date on this subsequent phase can be committed in the Demo plant.

Permits

Applications for permits and certificates of authorization are planned in two phases. The first phase (Phase 1) involves the stripping and storage of the overburden and the second phase (Phase 2) deals with the bulk sample, the Demo Plant operation and the tailings and water management.

The current deforestation and stripping work is covered under the Phase 1 permitting which has been granted by the Québec government. The planned Phase 2 work is conditional on obtaining the necessary authorizations and permits. A restoration plan has been submitted to provide a financial guarantee for the restoration of the site following the field operations.

Investment

Nouveau Monde has raised the necessary funding required for the field work as well as for the preparation and installation of the flotation circuit which will enable the test production of graphite concentrate. The investments needed to achieve this first phase are $12.7M (CAD).

Sustainable development

Both the development of the Demo Plant project and its implementation are subject to the rigorous principles of sustainable development that frame all of Nouveau Monde’s actions. For example, some components of the project were developed in collaboration with project stakeholders, including the accompanying committee. Discussions and collaboration with the Stakeholder Committee and Nouveau Monde resulted in the integration of several mitigating measures into the design of the Demo Plant project, including:
•The adoption of a work schedule limiting the impact of ore transportation on traffic and noise, i.e., a stoppage of work during:•Weekends, Fridays afternoons and evenings;
•The holiday season and spring break of the local school board;
•Construction holidays and the moose hunting season.

•The use of dust suppressants on the gravel section of the municipal road to control dust during transportation periods.

In addition, Nouveau Monde intends to maximize the positive impacts of the Demo Plant project by working with local entrepreneurs and hiring regional labor, including from the Atikamekw community of Manawan. As an example, the blasting pattern for the bulk sample has been modified to reduce particle size thereby allowing local contractors to qualify for bids.

Eric Desaulniers, President and CEO of Nouveau Monde started, “The start of construction of our Demo Plant is an exciting time for Nouveau Monde stakeholders including our employees, shareholders and the local community. All stand to benefit from this project as we start our first phase of production of graphite concentrate and later value-added battery grade graphite products.”

About Nouveau Monde’s Demo Plant

Nouveau Monde’s Demo Plant will be built on an existing industrial property in Saint‑Michel‑des-Saints and will have a gross ore feed capacity of 3.5 t / h to produce a graphite concentrate, purified spheronized graphite as well as micronized graphite. The plant will be operating on a 5‑day-a-week basis, 24 hours a day. Its expected operational life is about two years. Il will be fed by ore from the nearby West Zone deposit located on Nouveau Monde’s Matawinie graphite property.

It is not expected that the Demo Plant provide any profitability from this operation. However the Demo Plant will provide the following benefits:
•allowing to qualify Nouveau Monde’s products with customers;
•testing and improving the graphite concentrate process prior to its commercial design;
•developing value-added graphite products;
•testing new innovative mining waste management methods and site restoration technologies;
•to begin employees’ training and raise local youth awareness of future job opportunities;
•demystifying mining operations for the local entrepreneurs and community members.

About Nouveau Monde Graphite

In 2015, Nouveau Monde discovered a graphite deposit on its Tony claims block, part of its fully owned Matawanie graphite property. This discovery recently gave rise to the publication of results from a Prefeasibility Study (PFS), released on October 25, 2017 by Nouveau Monde. This PFS demonstrated strong economics with a planned production of 52,000 tpy of high purity flake graphite concentrate, and a mine life of 27 years. The Probable Mineral Reserves, identified over the West Zone of the Tony Block totals 33.0 Mt grading 4.39 % Cg. These Reserves are prepared in accordance with Canadian Institute of Mining, Metallurgy and Petroleum Definitions Standards for mineral resources in concordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects. The Matawinie graphite project is located in the municipality of Saint-Michel-des-Saints, approximately 150 km north of Montreal. It benefits from direct access to a workforce and the appropriate infrastructure to operate, including abundant and renewable hydroelectric resources. Nouveau Monde’s team members are developing this project with the outmost respect for the neighboring communities, while targeting a low environmental impact footprint.

The technical information in this news release was prepared by Antoine Cloutier, P. Geo and chief geologist for Nouveau Monde. Mr. Cloutier is a Qualified Persons under National Instrument 43-101.

SAINT-MICHEL-DES-SAINTS, QUEBEC–(Marketwired – Dec. 12, 2017) – Nouveau Monde Graphite Inc. (“Nouveau Monde”) (TSX VENTURE:NOU)(OTCQB:NMGRF)(FRANKFURT:NM9) is pleased to announce the publication of a technical report for the Pre-feasibility Study (“PFS”) covering the West Zone of the Tony Claim Block, part of its Matawinie graphite Property. The report, completed in accordance with National Instrument (NI) 43-101, details the PFS results announced in the press release dated October 25, 2017. The complete PFS report titled “43-101 TECHNICAL PRE-FEASIBILITY STUDY REPORT FOR THE MATAWINIE GRAPHITE PROJECT”, dated December 8, 2017, is available on SEDAR, as well as on the company’s website through this link:

https://nouveaumonde.ca/wp-content/uplo ... -SEDAR.pdf

New Appointments to Technical Team

Furthermore, Nouveau Monde wishes to announce the appointment of three professionals to its technical team. Those individuals will conduct and support the upcoming feasibility study and other work related to the mining process and value-added graphite product research as well as the construction and operation of the demonstration plant (for further details, see Press Release dated December 4, 2017).

Nouveau Monde has appointed Mr. Pierre Terreault, P.Eng., MPM., as Principal Director. Mr. Terreault has more than thirty-six years of experience. He is a graduate mining engineer from the Montreal École Polytechnique and also holds a Master’s Degree in Project Management (MGP). He has worked with various operating companies such as Osisko Mining, Norda Stelo, Strateco Resources, Goldcorp, and Wesdome to name a few, and his experience encompasses mine engineering, mine operations and production, preparation of feasibility studies and new mine development as well as managing project budgets, and the permitting processes. As Principal Director, Mr. Terreault’s main responsibilities will be to plan and manage the work related for the upcoming Feasibility study, spearhead the environmental and social impact study as well as manage construction of the pilot plant.

Nouveau Monde Graphite is also pleased to announce the appointment of Mr. Martin Brassard as Research and Development Director. Mr. Brassard has a PhD in chemical engineering and a M.Sc. in chemistry. He brings more than 15 years of experience in research and development acquired in the metallurgical and pharmaceutical sectors. Mr. Brassard will be responsible for the coordination of research and development activities at Nouveau Monde. His broad area of expertise in hydro, electro and pyrometallurgical processes will be an asset for Nouveau Monde Graphite in the development of value added graphite products.

Finally, Nouveau Monde has appointed Mr. Eric Forget to the position of Process and Metallurgy Director. Mr. Forget graduated from Ecole Polytechnique de Montreal as a Materials Science Engineer with a specialization in metallurgical processes. Prior joining Nouveau Monde, Mr. Forget worked in the semiconductor industry as a process Engineer and, for the last nine years, he was a consultant for BBA, focused on mining sector projects. While at BBA he lead various greenfield mine studies (iron, gold, lithium, etc.) as well as the detailed engineering of existing plants. In his new position with Nouveau Monde, Mr. Forget will be responsible for the demonstration plant’s detailed engineering, construction, commissioning and operation. Mr. Forget will focus on the commercial process and plant design at every stage of its development for the next two years. Mr. Forget will also work closely with the Task Force studying a net zero carbon emission mining project.