North of 60 Mining News - The mining newspaper for Alaska and Canada's North

Sen. Donny Olson, D-Golovin, Feb. 19 introduced Senate Bill 203, legislation that would allow the Alaska Industrial Development Export Authority (AIDEA) to issue up to US$80 million in bonds to finance infrastructure and construction costs of the Graphite Creek graphite project on the Seward Peninsula.

Located about 35 miles north of Nome, the Graphite Creek hosts 744,000 metric tons of graphite in 10.32 million metric tons of indicated resource grading 7.2 percent graphitic carbon; plus 4.7 million metric tons of graphite in 71.24 million metric tons of inferred resource averaging 7 percent graphitic carbon.

This resource makes up only a small section of the larger graphite mineralization that spans some 11 miles of the Kigluaik Mountains.

A preliminary economic assessment for Graphite One Resources Inc., the company advancing the Graphite Creek project, outlines plans for a mine that would produce 60,000 metric tons of graphite concentrates per year.

Under the legislation introduced by Olson, AIDEA would own and operate the access road, port improvements, power generation facility and related infrastructure for the Graphite Creek project site.

The concentrates produced at the Seward Peninsula deposit would be shipped to an advanced material processing facility that is expected to produce roughly 42,000 metric tons of coated spherical graphite and almost 14,000 metric tons of purified graphite powders per year.

In a report published last May, AIDEA identified four Southcentral Alaska locations – Homer, Kenai, Port Mackenzie and Seward – that could host this facility to produce the spherical graphite needed in lithium-ion batteries.

In 2017, the United States imported 50,000 metric tons of graphite to meet its domestic needs

Tesla's Gigafactory, an enormous lithium-ion battery manufacturing plant in Nevada, is expected to need nearly twice this much graphite when its reaches full production capacity, expected late 2018 or early 2019

"When the plant is complete, it will require 93,000 tons of flake graphite to produce 35,200 tons of spherical graphite for use as anode material for lithium-ion batteries," the U.S. Geological survey penned in its 2018 minerals report.

Currently, the U.S. relies on foreign sources for 100 percent of its natural graphite needs.

In 2017, principal U.S. import sources of natural graphite were, in descending order of tonnage, China, Mexico, Canada, Brazil, and Madagascar.

Sen. Olson said the Graphite One project has the potential to be a domestic source for the growing graphite demand in the U.S. and boost the Seward Peninsula economy in the process.

"The Seward Peninsula Kigluaik Mountains has a significant graphite surface deposit that can lend a positive impact on the local economy," he said. "This is an opportunity to meet those economic needs, create more jobs in rural Alaska, and supply the United States with a local source of graphite."

Senate Bill 203 has been referred to the Community & Regional Affairs and Finance committees.

–SHANE LASLEY