NMG Issues Results of Feasibility Study for its Integrated Ore-to-Anode-Material Model Projected to be North America’s Largest Natural Graphite Operation with Attractive Economics
Nouveau Monde Graphite (NMG) has released a feasibility study for its Phase-2 Matawinie Mine and Bécancour Battery Material Plant, demonstrating strong economic viability. The study projects a C$ 1,581 million after-tax NPV and a 21% after-tax IRR, with an annual production capacity of 103,328 tonnes of graphite concentrate and 42,616 tonnes of anode material. The projects are situated within 150 km of Montréal, leveraging clean hydropower, vertical integration, and robust market demand. NMG aims to provide carbon-neutral, locally sourced materials for battery and EV manufacturers, while actively engaging with local communities and emphasizing ESG credentials.
- Projected after-tax NPV of C$ 1,581 million and after-tax IRR of 21%.
- Annual production capacity of 103,328 tonnes of graphite concentrate and 42,616 tonnes of anode material.
- Located within 150 km of Montréal, utilizing clean hydropower and reducing carbon footprint.
- Robust market demand for graphite-based solutions amid projected production deficits.
- Potential risks associated with construction workforce availability and equipment delivery delays due to COVID-19.
- Uncertainties in the purification cycle time which may require additional furnaces.
- Recommended management risk reserve of C$ 150 million to cover project uncertainties.
This news release constitutes a “designated news release” for the purposes of the Company’s prospectus supplement dated
- NMG is developing a turnkey natural graphite operation with competitive advantages due to its privileged location, vertical integration, cost structure, ESG credentials and experienced team.
-
The Company’s
Phase-2 Matawinie Mine and Bécancour Battery Material Plant projects, located within a 150-km radius ofMontréal, Québec , show attractive economics and robust operational parameters underpinned by a large mineral property, NMG’s proprietary technologies, and clean hydroelectricity powering its operations. -
The Feasibility Study of NMG’s integrated operation indicates a
21% after-tax IRR and NPV ofC based on current projections of pricing prepared by a third-party expert for high-purity flakes and advanced graphite materials.$ 1,581 million - NMG’s integrated production flowsheet provides the flexibility to distribute graphite concentrate per flake size and market demand in order to cater to the most profitable segments.
- NMG’s phased approach has helped de-risk NMG’s projects while accelerating the engineering of Phase-2 operations, generating process and cost optimization, and supporting commercialization with potential customers.
- NMG is designing a mine of the future, targeted to be all-electric, complemented by clean advanced beneficiation facilities in order to provide battery and EV manufacturers with responsibly extracted, environmentally transformed, and locally sourced green anode material.
-
Shareholders and analysts are invited to attend an Investor Briefing at
10:30 a.m. ET hosted by NMG’s Management Team via webcast: https://us06web.zoom.us/webinar/register/WN_XA0uyzAQTBiPinZmx3pvuA
Rendering of NMG’s future
Updating resources and reserves, operational, and financial metrics of the
Arne H Frandsen, Chair of NMG, said: “Market trends have accelerated in past months and while inflation and logistics turbulences present a more challenging environment, we have demonstrated our graphite expertise, advanced manufacturing capacity and complex project management skills to execute our vision of an integrated green anode material production. The successful upstream integration is designed to ensure that we have access to high-quality, responsible feedstock for decades to come, and provides battery and EV manufacturers with the assurance of a traceable, local, and carbon-neutral supply.”
Table 1: Economic highlights of NMG’s integrated Phase-2 graphite operations.
ECONOMIC HIGHLIGHTS |
|
Bécancour Battery Material Plant |
INTEGRATED NMG MODEL |
Pre-tax NPV ( |
|
|
|
After-tax NPV (8 % discount rate) |
|
|
|
Pre-tax IRR |
|
|
|
After-tax IRR |
|
|
|
Pre-tax payback |
3.2 years |
4.3 years |
3.9 years |
After-tax payback |
3.7 years |
4.5 years |
4.2 years |
Annual average production |
103,328 tonnes of graphite concentrate |
42,616 tonnes of anode material 3,007 tonnes of purified jumbo flakes 18,384 tonnes of by-product fines |
- |
Life of mine (“LOM”) |
25 years |
- |
- |
Initial CAPEX |
|
|
|
Annual OPEX |
|
|
|
CAPEX and OPEX were established from test work results, Phase-1 operations, supplier quotations and consultant’s in-house databases. Estimates being currently at the market's peak as influenced by inflationary trends, NMG and its consulting firms have refined design, engineering, and construction parameters to enable cost optimization and competitive pricing of NMG’s production. Québec’s affordable clean hydropower underpins the Company’s technologies, economics structure and carbon-neutrality commitment.
NMG’s integrated business model, with a secured feedstock, close-by operations at the western market’s doorstep and operational flexibility to adapt production based on demand, represents a stable and cost-effective structure in today’s everchanging macroeconomics.
Product Offering and Market
The integrated material flowsheet developed by NMG is designed to leverage the distribution of graphite concentrate flake sizes to be produced at the
Selling prices were calculated using forecasts provided by Benchmark Mineral Intelligence, an IOSCO-regulated price reporting agency and market intelligence publisher for the lithium-ion battery to EV supply chain. They were estimated for the North American market where the Company is expected to have competitive advantages over international producers, namely its carbon-neutral footprint, multimodal logistical base, stable political jurisdiction and exclusion from
Pressure caused by gigafactories development across the world, limited production capacity impacted by Chinese pandemic measures and turbulent logistics is reflected in the year-over-year flake graphite price increase of
Mineral Resource and Reserves
The mining property (the “Mining Property” or the “Tony Block”) presently consists of 159 contiguous map-designated claims totalling 8,266.42 hectares (“ha”) wholly owned (
Exploration work on the Mining Property targeted graphite mineralization and consists to date of airborne geophysics, prospecting, ground TDEM surveying, trenching/channel sampling and core drilling. Surface and core samples were also collected for metallurgical and geomechanical tests. Exploration work uncovered significant crystalline flake graphite mineralization ultimately leading to the identification of Mineral Resources and Reserves.
Mineral Resources have been estimated for the
Table 2: Current Pit-Constrained Mineral Resource Estimate for the
Mineral Resource Category2 |
Current Resource ( |
||
Tonnage (Mt)5,6 |
Grade (% Cg)3 |
Contained Graphite (Mt) |
|
Measured |
28.5 |
4.28 |
1.22 |
Indicated |
101.8 |
4.26 |
4.33 |
Measured + Indicated |
130.3 |
4.26 |
5.55 |
Inferred4 |
23.0 |
4.28 |
0.98 |
|
A combined Mineral Resource of the South-East and South-West zones is also present on the Mining Property. While these deposits are part of the Property, they have not been studied to be integrated in the Mineral Reserves or the mine plan.
The table below presents the Mineral Reserves which have been estimated for the
Table 3: Matawinie Mineral Reserves for the
Category |
Tonnage (Mt) |
Grade (% Cg) |
Contained Graphite (Mt) |
Proven |
17.3 |
4.16 |
0.7 |
Probable |
44.3 |
4.26 |
1.9 |
Proven & Probable |
61.7 |
4.23 |
2.6 |
The Qualified Person for the Mineral Reserve Estimate is
The effective date of the estimate is
Mineral Reserves were estimated using a graphite concentrate average selling price of
A metallurgical recovery of
A cut-off grade of The strip ratio for the open pit is 1.16 to 1. The Mineral Reserves are inclusive of mining dilution and ore loss. The reference point for the Mineral Reserves is the primary crusher. Totals may not add due to rounding. |
The deposit will be mined using conventional open-pit mining methods consisting of drilling, blasting, loading, and hauling. Estimation of the Mineral Reserves included pit optimization, pit design, mine scheduling, and the application of modifying factors to the Measured and Indicated Mineral Resources. To maximize the NPV, mining phases have been designed and incorporated into the mining sequence to defer waste rock stripping and provide a balanced blended feed grade for the concentrator over the LOM. The mine plan is successful at achieving the targeted concentrate production with a strip ratio of 1.16:1 and an average grade of
A concentrator will be built adjacent to the pit. The concentrator was designed based on the results from the metallurgical testing at NMG’s Phase-1 mineral processing facility plant and at external labs. Through crushing, milling, flotation, cleaning, and drying, the ore is concentrated to attain
Table 4: Graphite Concentrate Size Fraction Proportion
Graphite Concentrate Flakes Size Fraction |
Proportion |
|
Jumbo (+50 mesh) |
|
|
Coarse (-50+80 mesh) |
|
|
Intermediate (-80+150 mesh) |
|
|
Fine (-150 mesh) |
|
Tailings produced by the concentrator will be separated into non-acid generating (“NAG”) and potentially‑acid generating (“PAG”) for co-disposal with waste rock. A co‑deposition storage facility will be located at surface and as of Year 8, tailings will be returned to the pit using the co-disposal system. The deposit will be mined from south to north to ensure adequate space is available for in‑pit backfilling. See Environmental Design & Carbon Neutrality Commitment section for additional information.
As part of its electrification strategy, NMG is committed to having both heavy equipment used for mining operations and ore concentration and processing activities become fully electric within the first five years of production. NMG’s electrification plan is not presented in this Study as active planning and development are ongoing with Caterpillar Inc., which is expected to supply the equipment using their Job Site Solution service model. With this model, NMG would pay for machine use on an hourly basis which includes machine supply and maintenance (parts and service) and a fleet management system. Electrical trucks and equipment would be introduced into the mining fleet as they become available. Projected to be the world’s first all-electric open-pit mine, the
Table 5: Operational and Economic Highlights of the
Parameters |
|
LOM |
25 years |
Nominal annual processing rate |
2.55 M tonnes |
Stripping ratio (LOM) |
1.16:1 |
Average grade (LOM) |
|
Average recovery |
|
Average annual graphite concentrate production (LOM) |
103,328 tonnes |
Finished product purity |
|
CAPEX |
|
Annual OPEX |
|
OPEX cost per tonne of graphite concentrate |
|
Matawinie average basket price (LOM) |
|
All governmental permits and municipal authorizations pertaining to exploration, geotechnical, hydrogeological, and early preparatory works to date have been obtained. The ministerial decree authorizing the
Early works for the
In striving to limit potential impacts and plan beyond the LOM, the Company has developed the
Bécancour Battery Material Plant
NMG’s advanced manufacturing operations will be regrouped at its Phase-2 Bécancour Battery Material Plant located in
In 2021, NMG purchased a 200,000-m² land in the
Regrouping onsite all beneficiation units, the Bécancour Battery Material Plant is designed to receive approximately 63,775 tpa of graphite concentrate from the
For CSPG production, the finest flake size fraction graphite concentrate will undergo micronization and spheronization (“shaping”), purification and coating. A portion of the jumbo flake production from the
The shaping process, essentially a mechanical transformation, reduces the flake size (micronization) to D50 of approximately 10 to 20 microns and rounds graphite material (spheronization) to increase the density of the spherical graphite for battery use. Shaping will also generate by-product fines to be sold as carbon riser.
NMG’s proprietary carbochlorination purification process elevates graphite materials to ≥
The ultimate beneficiation step, coating is instrumental to battery technology. By applying a nanometric layer of amorphous carbon on the surface of spheronized purified graphite, coating helps create a stable electrolyte interface layer in the battery system and increase initial coulombic efficiency and discharge capacity, thus extending the battery performance over time. NMG’s coating technology is projected to reduce the energy consumption of this process up to
Piloting of all Phase-1 battery material modules is ongoing to produce large samples for battery manufacturers in order to accelerate the commercial qualification of the battery-grade commercial products.
Table 6: Operational and Economic Highlights of the Bécancour Battery Material Plant
Parameters |
|
Annual throughput |
63,775 tonnes |
CSPG yield |
≥ |
Annual CSPG production |
42,616 tonnes |
Annual purified jumbo flake production |
3,007 tonnes |
Annual by-product fines production |
18,384 tonnes |
Finished product purity |
≥ |
CAPEX |
|
Annual OPEX |
|
OPEX cost per tonne of CSPG throughput1 |
|
|
|
|
The Bécancour Battery Material Plant will be organized by process sectors, with dedicated facilities for shaping, purification, and coating, plus support services. This modular facility is designed with a capacity to expand as demand increases in battery and specialty markets.
Environmental Design & Carbon Neutrality Commitment
NMG intends to develop a world-class operation at its
For the
NMG incorporated forward‑looking environmental initiatives to limit the Matawinie Mine’s potential impact on the natural and human milieu:
- integrated onsite water management system ensuring constant monitoring and treatment that meet high-quality standards;
-
desulphurization, dry-stacking, and co-disposal of tailings and waste rock in line with requirements of the best practices such as the Toward Sustainable Mining Standard, the Global Industry Standard on Tailings Management, and the
International Network for Acid Prevention ; - progressive land reclamation through backfilling of the pit and a comprehensive restoration plan;
- biodiversity protection measures to help preserve – and enhance where possible – the local ecosystem;
- optimization of the project’s footprint to account for environmental characteristics and address stakeholders’ concerns;
- all-electric fleet – what is projected to be the world’s first for open-pit mining – powered by Québec’s clean, abundant, and affordable hydroelectricity;
- territory integration plan to enhance the area around the mining site and improve the region’s tourism and cultural offer;
- proactive voluntary acquisition program for landowners within a 1-km radius of the mining site.
As per Québec’s and Canada’s stringent environmental framework, NMG must comply with robust regulatory requirements regarding the quality of the environment, social and environmental monitoring, reporting, and permitting for different phases of construction, mining operations, and closure.
A Monitoring Committee, previously operating as NMG’s Accompanying Committee since 2017, is in place and functions as both a consultative body as well as a platform for environmental and social surveillance of NMG’s operations.
For the future Phase-2 Bécancour Battery Material Plant, NMG completed an environmental baseline study of the 200,000-m2 land located within the industrial park. Results suggest the absence of soil and water contamination as well as no plant species threatened, vulnerable or likely to be designated so. As NMG advances the development of its project, feedback from local stakeholders will be important to ensure an inclusive and respectful diversification of the local and regional economy.
NMG is designing a mining and advanced manufacturing operation aligned with global decarbonization efforts. In 2021, NMG laid the foundation for its climate strategy first by tracking its historical emissions from the initial phases of its mining exploration and offsetting this carbon footprint. Through its Climate Action Plan released in
In addition to GHG reduction opportunities, NMG has launched R&D projects to continually improve its carbon footprint. Furthermore, the Company has developed an offset strategy for the remaining emissions to provide assurance to its customers of carbon-neutral products at every stage of its production development. The strategy includes commitments to transition to sequestration credits, the development of a Company’s portfolio of offsetting projects, partnerships with local communities, industrial synergies, and investments in developing countries. This approach is aimed at ensuring a swift transition to Net Zero while limiting the financial risk associated with the carbon credit market.
Next Steps and Quality Assurance
This Study shows that the projects are technically feasible as well as economically viable. It further strengthens ongoing project finance efforts and active commercial discussions with a view towards securing an anchor customer agreement with potential financial participation. From the final investment decision, NMG’s
Shareholders and analysts are invited to attend a webcast Investor Briefing this morning,
There is no certainty that the economic forecasts on which this Study is based will be realized. There are a number of risks and uncertainties identifiable to any new project and usually cover the mineralization, process, financial, environment and permitting aspects. NMG’s Phase 2 is no different and an evaluation of the possible risks was undertaken as part of the Study.
Following an analysis of the major risks to the project, a P50 management risk reserve of
Scientific and technical information presented in this press release was reviewed and approved by
The Study for the
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Cautionary Note
All statements, other than statements of historical fact, contained in this press release including, but not limited to those describing the impact of the foregoing on the project economics, Study results (as such results are set out in the various tables featured above, and are commented in the text of this press release), including CAPEX, OPEX, NPV and IRR, the estimated value of the
Forward-looking statements are subject to known or unknown risks and uncertainties that may cause actual results to differ materially from those anticipated or implied in the forward-looking statements. Risk factors that could cause actual results or events to differ materially from current expectations include, among others, those risks which are discussed under the “Next steps and Quality Assurance” paragraph, delays in the scheduled delivery times of the equipment, the ability of the Company to successfully implement its strategic initiatives and whether such strategic initiatives will yield the expected benefits, the availability of financing or financing on favorable terms for the Company, the dependence on commodity prices, the impact of inflation on costs, the risks of obtaining the necessary permits, the operating performance of the Company’s assets and businesses, competitive factors in the graphite mining and production industry, changes in laws and regulations affecting the Company’s businesses, political and social acceptability risk, environmental regulation risk, currency and exchange rate risk, technological developments, the impacts of the global COVID-19 pandemic and the governments’ responses thereto, and general economic conditions, as well as earnings, capital expenditure, cash flow and capital structure risks and general business risks. A further description of risks and uncertainties can be found in NMG’s Annual Information Form dated
Many of these uncertainties and contingencies can directly or indirectly affect, and could cause, actual results to differ materially from those expressed or implied in any forward-looking statements. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are provided for the purpose of providing information about management’s expectations and plans relating to the future. The Company disclaims any intention or obligation to update or revise any forward-looking statements or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law.
The market and industry data contained in this press release is based upon information from independent industry publications, market research, analyst reports and surveys and other publicly available sources. Although the Company believes these sources to be generally reliable, market and industry data is subject to interpretation and cannot be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data-gathering process and other limitations and uncertainties inherent in any survey. The Company has not independently verified any of the data from third-party sources referred to in this press release and accordingly, the accuracy and completeness of such data is not guaranteed.
Disclosure regarding Mineral Reserve and Mineral Resource estimates included in this press release were prepared in accordance with Canadian NI 43-101. The disclosure included in this press release use the terms “Feasibility Study,” “Mineral Resource,” “Inferred Mineral Resource,” “Indicated Mineral Resource,” “Measured Mineral Resource,” “Mineral Reserve,” and “Probable Mineral Reserve” in connection with the presentation of resources, as each of these terms is defined in accordance with the CIM Definition Standards on Mineral Resources and Reserves adopted by the
NI 43-101 is a rule developed by the Canadian Securities Administrators that establishes the Canadian standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. These standards differ from the requirements of the
Neither the
Further information regarding the Company is available in the SEDAR database (www.sedar.com), and for
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MEDIA
VP Communications & ESG Strategy
+1-450-757-8905 #140
jpaquet@nmg.com
INVESTORS
Director, Investor Relations
+1-450-757-8905 #993
mjasmin@nmg.com
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