Lamboo Resources’ sampling uncovers high grade flake graphite in South Korea
Lamboo Resources (ASX: LMB) has discovered high grades of up to 18.9% graphitic carbon over 20 metres in continuous channel sampling conducted at its Geumam Graphite Project in South Korea.
Critically, a mining operation and flotation processing plant was previously established at Area B at Geumam in 1986.
The plant was capable of producing 6tpd fine flake graphite flotation concentrate (>85% Cg), which it sold to export markets in Japan and Europe.
Lamboo's Korean graphite projects are located close to one of the most significant global markets for flake graphite.
Today's results returning high grade pure and substantial flake graphite are on the doorstep of the world’s largest flake graphite market.
It is possible that Lamboo can utilize a very low cost mining approach in South Korea that benefits from excellent infrastructure ensuring quality product can be delivered to customers.
The channel sampling was carried out over five prospects – Areas A, B, C, D and E – which combined have an exploration target of 17 to 28 million tonnes at 5% to 10% graphitic carbon for 1.5 to 2 million tonnes of contained flake graphite.
Importantly, these new results lift the potential of the project to substantially increase the current JORC Resource of 200,000 tonnes at 10% graphitic carbon.
The project is strategically located close to one of the most significant global markets for flake graphite, with demand for graphite expected to grow in North Asia at a higher rate than any other region over the next five years.
Geumam has significant areas of flake graphite outcropping at areas A, B, C, D, E, F and G.
Geological mapping and a review of all historical exploration data reported by the Korean Mining Promotion Corporation has identified zones of graphite of economically significant size and grade at prospect Areas A, B, C, D, E, F and G at Geumam.
These zones outcrop from surface and the moderately dipping graphite mineralisation is amenable to open pit mining methods.
Area C is the highest ranked exploration target at Geumam.
Twenty eight check rock chip check samples were collected from Area C, with results confirming the presence of previously identified graphite mineralisation.
Continuous channel rock sampling was possible at several exposures of graphite in road cuts.
Peak results included 20 metres at 18.9% graphitic carbon, 20 metres at 15.2% graphitic carbon, 40 metres at 9.07% graphitic carbon – including 10 metre intervals up to 11.00%, 10 metres at 9.15% graphitic carbon, and 5 metres at 14.5% graphitic carbon.
Large graphite market
South Korea is the third largest Asian economy, with major steel, automobile and heavy chemical industries. A well-developed downstream graphite processing industry exists in South Korea.
There is an opportunity to substitute flake graphite into some synthetic graphite markets because of its cost competitiveness.
South Korea is the world’s second largest importer of synthetic graphite, estimated to be 52,000 tonnes in 2011 and growing at a rate of 27% per annum.
A new graphite mining and processing operation in South Korea will have several key advantages over most potential global competitors, including:
- Low cost processing capabilty
- Favourable geology, with world class graphite deposits situated in the North China craton.
- Close proximity to the largest markets for graphite in North Asia (China, Japan and South Korea).
South Korean companies are at the leading edge of technological developments in electronics, batteries and automobiles, the principle sectors that are driving new demand for graphite.
In addition, major Japanese players are investing in new synthetic graphite plants in South Korea.
- Minimal transportation freight costs.
- Low sovereign risk for investment.
- Highly efficient container ports, linked to an excellent modern road and rail transportation network.
- Low electrical power costs for industry (base load nuclear power).
- Highly educated and skilled workforce.
- Stable, democratically elected government.
- Workable Mining Act.
Lamboo is finalising clearances with local landholders so it can immediately begin a drilling program at the Geumam Project.
Drilling will be targeted at substantially increasing the current resource base.
Lamboo held around A$1.85 million in cash at the end of the March 2013 quarter.
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