Early assay results indicate rich Mazarin graphite deposit

First assays indicate an average grade at the Lac Knife main zone of 16.8% graphite, which is considered high grade material. The company says the zone extends along 500 ft and has a width at surface of 65-to-130 ft. Two holes drilled 820 ft south of the main zone have intersected graphite over a width of more than 165 ft.

Thirty-five holes, representing 7,000 ft, have been drilled to date. The plan calls for 60 more holes to be drilled by the end of March. The $1-million exploration program is being funded $650,000 by Mazarin, $400,000 by the province of Quebec and $30,000 by a Fermont area industrial commission known as the New-Quebec Mining Exploration Fund.

Mazarin vice-president exploration Jacques Bonneau equates the 16.8% grade of the graphite deposit with a grade for gold mineralization in the 0.2-0.4 oz per ton range.

“With that grade, you can be very aggressive in the market,” Mazarin president Regis Labeaume said. Market is growing

While the world market for natural graphite is still relatively small (in the 660,000-ton-per-year range), it is growing. The mineral has application in numerous areas, including in the refractory, aeronautic, automotive and steel-making industries. It is used in the manufacture of batteries, brake linings and pencils.

China, the U.S.S.R., North and South Korea, Madagascar, Sri Lanka and India are among the main producers of the world’s graphite. Principal consumer- nations of the mineral are Japan, the U.S., West Germany and the U.K.

Of the three types of natural graphite mined — amorphous, vein and flake — the flake variety seems to be most in demand. Valued for its industrial applications, flake graphite (in coarse form) is also considered a strategic mineral. Coarse flake graphite (the larger the flake size, the greater its value) currently sells in the $500-$1,000(US) per ton range.

Once the winter exploration work is complete, Mazarin says the next step is a program to prove up reserves. A summer program, probably starting in June, is planned, which would lead into the feasibility study stage. Assuming a positive report, Labeaume said production could be under way by the end of 1990 or early in 1991.

A mill would be built at the deposit to process material from the open-pit mining operation. The area, known for its iron ore deposits, is serviced by rail and is accessible by road.

Labeaume said he has been corresponding with possible graphite concentrate buyers. To be economical, the Lac Knife project would have to sell at least 10,000 tons of concentrates per year, Bonneau said. Bulk sample

Mazarin will soon be sending a 25-ton bulk sample to the Mineral Research Centre in Quebec City for testing.

Among the first assay results from the drilling were the following:

Length % Hole (ft) Graphite 89-01 10.2 14.8 89-02 48.9 14.7

(incl.) 42 16.3 89-03 92.2 13.8 89-04 111.5 19.7 89-08 85 17.4

Elsewhere in Quebec, Stratmin Inc. (ME) began production this month at its St-Aime-du-Lac-des- Iles graphite deposit. Stratmin has uncovered about 26 million tons of reserves averaging 7.2-8.12% graphite.

In Ontario, Cal Graphite (VSE) is gearing up for production at its open-pit, large tonnage, crystalline flake graphite deposit north of Huntsville. Another junior, Stewart Lake Resources (TSE), is active north of Kingston, where it says exploration has uncovered a low tonnage, high grade deposit hosting a mix of coarse, fine and medium-size flake graphite.

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