Monday, August 29, 2011

A walk around the Lac Knife deposit owned by Focus Metals

Recently I was invited to attend a trip, by the management of Focus Metals, for the purpose of going to the Lac Knife property and seeing first-hand what the property looked like and as a factual information opportunity. This of course offers a chance to really get a feel for what the property holds from a resource standpoint, as well as offering some insight into just how large the potential is for this project. Our tour guide was CEO Gary Economo, who was very open on most topics, but of course some questions could not be answered due to the need for confidentiality at this time, which I might add will be revealed as quickly as is practical.

The flight from Ottawa to Wabush, Labrador, which is the closest airport to Lac Knife where we could land, offers a stunning view of the several operating iron-ore mines in the area. Once we landed in Wabush, we then were driven approximately an hour and a half to the Lac Knife property.

As we entered the property, there were several outcrops, which were clearly visible at surface, that are graphite boulders. Some of them had the appearance of being just another boulder, but with little effort it was possible to chip off a sample and easily see that it was graphite. Gary explained that as we first enter the resource area, the deposit is approximately 20 meters wide and reaches widths of approximately 100 meters or more midway through the property, and then narrowing down to approximately 30 meters wide. Thus, it leaves the actual deposit with a similar shape to a North American football. The drilling to date has only accomplished reaching depths of approximately 120 meters. This leaves Lac Knife not only open at depth, but also to the south. The potential for an expansion of resources to the south are exceptional, since, while standing at the south end of the current resource area, and looking to the south, there are several large outcrop boulders of graphite visible. These outcrops to the south are approximately 250 -300 meters past the south end of the resource area. It was with relative ease that one could start to sense the actual potential of this property.

There has been a considerable amount of excavation done in the mineralized zones. Much of this work was completed by the previous owners, such as Mazarin, while they were in a JV with the town of Fermont, QC, and also Graftech who was working with Ballard Power Systems. This work has left the deposit with an overburden of 3 to 6 meters in most areas. The following are some images showing what I am attempting to describe.

This is one of several outcrops visible as we entered the mineralized zone of the property. Although it may appear to look like just another rock, it takes very little effort to chip off a sample, and it is clearly graphite.

This is an image of another of the outcrops visible as we entered the Lac Knife deposit. These two outcrops are approximately 20 meters apart. While handling some of the material shown here it is quite apparent that this is an extremely high grade sample of graphite.

In this image I am holding a small piece I found on the roadway between the first and second mineralized zones. It would appear that all the graphite that is visible at surface seems to be of an unusually high grade. CEO Gary Economo, stated in his address to the Cambridge House Critical Materials Symposium, in June, 2011, " Early indications from our consultant preparing our 43-101 resource calculation are that we shall see no inconsistencies or variations from previous non-43-101 estimates that our property contains a 17% pure carbon content." I found that in walking the Lac Knife deposit these statements become more valid.

After experiencing Lac Knife in person, I look forward to just where this company is headed looking forward. The fact that the resource size is open at depth and to the south, and shows viable signs that this will undoubtedly become reality, is something that only helps one to view this in a positive light. The fact that the grade and quality of the graphite are so noticeable, tends to inspire questions of just what industries this grade of graphite may become useful to. The possible answer to these questions will be something for another article, but it has become clear that this graphite will undoubtedly attract the attention of some of the world's most prominent buyers. Further to the study of who may be interested in purchasing this graphite, comes the speculation of what, graphite of this grade, will be capable of in the graphene arena. This will also be something covered in an upcoming post.

The one thing that stood out prominently in my mind, was the fact that, not only does Focus Metals hold ownership of a world-class graphite deposit, but they also see the importance of finding the right customers who may potentially become off-take partners. This is a very important aspect, and as such it is being addressed by management as vigorously as possible. As I pointed out in an earlier post, there are several company's that seem well suited to potentially fill this need for an off-take partner. While I was not told who these company's are, I remain optimistic that my predictions have a good potential to become a reality. The much anticipated 43-101 is expected to come very close to the historical data, but it is also causing some waves, as some investors seem reluctant to believe the historical data. While I can appreciate the fact that the 43-101 is obviously necessary by todaysde-risk the project somewhat, but after visiting the site, I truly came away with a belief that the potential for Focus Metals and their 100% owned Lac Knife deposit is large at the least. With the feasibility of a resource expansion, pending further drilling, Lac Knife will, in my opinion, stand an excellent chance of achieving the goal of management, to become a dominant factor in the world of graphite, and eventually graphene supply.

On our return trip to the airport in Wabush, Labrador we stopped off in Fermont, QC briefly, where it is expected that the processing plant will be built, and following that, the upgrader plant that will bring the graphite to the 99% - 99.99% purity level, which is what the high-tech industries will require. According to Gary, there have been meetings with the town council, which have resulted in the town expressing their interest in welcoming this plant to their town.

Overall, I found this to be an inspiring property viewing, which by the time we left, had me appreciating this company and the management more than ever. I feel justified in my opinion that Focus Metals has what it takes to become the worlds premiere graphite supplier. In the coming days I will explore some of the topics that were omitted from this post.

I strongly encourage anyone who finds this company attractive as an investment choice, to do your own due diligence. An excellent place to start would be the Focus Metals website which is located at,

For disclosure purposes I have not received any compensation for my point of view or for this post. My travel expenses were covered by Focus Metals. I own shares in Focus Metals.

1 comment:

  1. Look forward to your follow up posts.