Standard Graphite CEO Chris Bogart Discusses the Graphite Boom on Midas Letter Money
Standard Graphite Corp. CEO (TSX.V:SGH) Chris Bogart talks about the forces driving the graphite price higher in this interview with host James West. Standard has a portfolio of projects throughout Canada and is fast-tracking exploration with the objective of becoming a near-term producer of graphite.
Other graphite companies in Canada are earlier stage, and in many cases, much more prospective for graphite than Standard Graphite, which makes it one of the most intriguing companies in this rapidly evolving space. There are many uses for graphite, from lithium ion batteries to next-generation pebble bed reactors.
James West: Hi, I am James West. This is Midas Letter Money and my guest today is Chris Bogart who is the President and CEO of a new company called Standard Graphite Corporation, it trades under the symbol SGH on the TSX Venture Exchange. Chris thanks for joining us.
Chris Bogart: Thanks for having me James.
James West: Now Chris, Graphite, that’s a relatively a new metal in the Lexicon of resource inventors around the world. What is the big deal with graphite?
Chris Bogart: Graphite we believe will be the next big strategic metal and I’m sure your audience is well aware of the strategic metals lithium. Rear earths have had the big run over the last five years.
James West: So basically, they go up and straight down again?
Chris Bogart: Not quite. We believe the fundamentals behind graphite are equally important in the demand, but the ability for the market to supply that demand is extremely limited. We believe there’s a long-term price appreciation happening in graphite based on this extreme supply demand scenario.
James West: Okay. So, demand is rising, supply is finite. Where does all the supply come from now?
Chris Bogart: So, supply predominantly is China, but 70% of the world’s graphite comes from China. The key to that number is a few things. Number one, flake graphite which is a very specific type of graphite, China does not have in large quantities. The growing demand, world demand in graphite is this very precious flake graphite that is not presently in abundance of quality in general.
James West: And so, what’s driving the demand for this big flake graphite?
Chris Bogart: So, two things. Number one, you’ve got traditional demand and look at metals in general. You’ve had a big commodity boom in the metals, nickel, copper, gold, pick your metal. Graphite has not had that run within this commodity super cycle and that’s traditional demand. Demand from China, India, Russia, Brazil, typical demand drivers.
Flake graphite in particular then is on top of that and that’s the technology, great graphite, the flake demand of fuels, fuel cells, nuclear reactors, wind power. And most importantly, we believe is the lithium ion battery in which graphite has 20 to 30 times more graphite by weight than a lithium in a lithium battery.
James West: So, graphite is more important to a lithium ion battery than lithium.
Chris Bogart: It should be a graphite lithium battery.
James West: Well, we have to invent something along those lines. So, let’s talk a bit about where you’re going to find your graphite. You’ve got some mineral claims in Quebec as well in Ontario. What’s drawn you to either of those and which one is your flagship?
Chris Bogart: So, we are in an area called the Grenville Province of Canada and Canada is well-known as the world’s best graphite exploration country, predominantly because it is a host to numerous flake graphite deposits and we are in that region.
So Quebec, we have nine properties currently, all within these very prolific districts. And we have three very large quality flake graphite projects in Ontario, which is again surrounded by either well-known graphite deposits or producing assets.
James West: So then, you’ve already done some drilling and metallurgy on your deposits at this point?
Chris Bogart: I’m happy to report, not yet but coming soon. So, we have acquired these projects based on the historic work that’s done on them. And we believe that our geologic team’s pedigree of success in the past which they have founded significant graphite deposits.
James West: Okay.
Chris Bogart: The opportunity within our current host of property is going to unlock a lot of value for investors.
James West: So, there is a historical non-43-101 compliant work has been done to identify these deposits as perspective for graphite deposits of economic grade?
Chris Bogart: Absolutely.
James West: But at this point, no drilling and early stage ground work, geophysics?
Chris Bogart: We have trenching done, ground sampling completed. We have historic drilling on some of our properties and we have just commenced an electromagnetic survey on all our properties in Quebec and Ontario. The Ontario projects have been completed and we’re expecting Quebec to be done within the next 30 to 45 days.
James West: Okay. So, let’s talk about now the next 12 months, 24 months going out. What would compel an investor to participate in standard graphite at this point and if they did, what do they get to look forward to?
Chris Bogart: So, I think the compelling reason is if you love the graphite sector, you’re looking for a project and a team that can deliver on successfully exploration results. We have very aggressive exploration strategy plan for 2012. We have already begun the implementation of it and in particular graphite, just by the nature of its very properties which is extremely conductive.
The projects are fairly homogenous in nature, so our ability to turn those projects into a developmental style project within the next 12 months is very real and very achievable.
James West: Okay. So, you’ve got multiple projects, electromagnetic surveys going on.
Chris Bogart: Correct.
James West: You’re going to start drilling at some point in 2012.
Chris Bogart: Our target plan is to start drilling in test targets on five to six of our best targets within the early part of the summer. Pick a flagship asset whichever the project has the best result and start a developmental aggressive developmental program by September of 2012.
James West: And cash in the bank right now?
Chris Bogart: We just raised $1.5 million. So, we’re currently at $1.7 million in the bank and we will need to go back to market at some point this year to fund an aggressive drill program.
James West: Okay. Well, lots to look forward to. Chris, we’re going to leave it at that. Thanks for joining us today.
Chris Bogart: James thanks for having me.
James West: If you like to learn more about Standard Graphite, go and visit them on the web at www.standardgraphite.com and if you want to learn more about early stage opportunities like Standard Graphite, visit www.midasletter.com. I’m James West. This is Midas Letter Money.
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