EV batteries to drive 9x graphite growth
Will Alaska be future US source of vital battery ingredient?
Last updated 6/22/2020 at 11:04am
At least 125 million electric vehicles are expected to be traveling global highways by 2030, which means the world is going to need a lot more graphite in the coming decade and beyond.
This is because graphite serves as the anode in the lithium-ion batteries that power these EVs, not to mention the growing number of portable tools and electronics that use the same type of battery.
According to Mineral Commodity Summaries 2019, an annual report published by the United States Geological Survey, there are currently no graphite mines in the United States, a dearth that required domestic manufacturers to import mined graphite for roughly 40,000 metric tons of the carboniferous material used in the U.S. during 2018.
China was the largest supplier of this graphite, followed by Mexico, Canada and Brazil.
This dependence on foreign suppliers and rocketing demand are the key reasons USGS includes graphite on its list of 35 minerals and metals considered critical to the United States.
USGS sees a major spike in U.S. demand for graphite when Tesla Motor's Gigafactory, an enormous lithium-ion battery facility being constructed in Nevada, is fully operational.
The Gigafactory, partially complete, is producing the batteries going into the cars coming off Tesla's assembly-line.
Once complete, this 10-million-square-foot plant in Nevada is expected to be able to manufacture enough batteries for roughly half a million Tesla's per year.
This plant alone will need around 35,200 tons of spherical graphite per year, a special form of graphite that is manufactured for batteries.
The spherical shape allows the graphite to be more efficiently packed into battery cells, while the coating extends the graphite's lifetime capacity.
It is expected to take about 2.9 tons of average flake graphite to make 1 ton of spherical graphite.
Graphite One Inc. has plans to provide an American source of spherical graphite from Graphite Creek, an enormous deposit in western Alaska with unique characteristics that makes it well suited for lithium-ion batteries.
"Our goal for Graphite One is to become a reliable producer of high-quality graphite for the rapidly evolving energy and high-tech sectors," said Graphite One CEO Anthony Huston.
Holding the power
With the growing number of EVs expected to drive lithium-ion battery demand, Benchmark Mineral Intelligence Managing Director Simon Moores told U.S. legislators that America is not doing enough to secure reliable sources of graphite and other materials that go into these cells.
"We are in the midst of a global battery arms race in which the U.S. is presently a bystander," the global battery materials authority inked in a testimony to the U.S. Senate Energy and Natural Resources Committee.
Benchmark estimates that the amount of graphite needed for the anode material in lithium-ion batteries will rocket to 1.75 million metric tons by 2028, a nine-fold increase over 2017 levels.
The battery analysts said China supplied 56 percent of the world's flake graphite supply – the mined feedstock that is used to manufacturer lithium-ion battery anodes – and 100 percent of the world's uncoated spherical graphite supply during 2017.
Moores' primary message to Washington D.C. lawmakers is the U.S. cannot afford to stand on the sidelines when it comes to lithium-ion batteries, and the graphite, lithium, cobalt and nickel that goes into them.
"Those who control these critical raw materials and those who possess the manufacturing and processing know-how, will hold the balance of industrial power in the 21st Century auto and energy storage industries," he wrote.
Graphite One hopes to leverage its enormous deposits of graphite in western Alaska to provide the U.S. a domestic source of the lithium-ion battery anode material.
While the Vancouver B.C.-based graphite exploration and development company has only systematically drilled a small section of the near-surface mineralization at this vast western Alaska graphite project, it has outlined a deposit that could provide a healthy domestic supply of this critical battery ingredient for decades.
Located about 35 miles north of Nome, the Graphite Creek deposit hosts roughly 5.7 million metric tons of graphite in resources, mostly inferred.
While globally significant, this deposit only considers a small fraction of the thick lenses of graphite surfacing along a 11-mile-long stretch of the Kigluaik Mountains on Graphite One's property.
In addition to size, the graphitic carbon at Graphite Creek has unique characteristics that make it ideally suited for being refined into the coated spherical graphite that lithium-ion battery manufacturers are looking for.
TRU Group Inc. – a technology metals consultant with expertise along the entire graphite-graphene supply chain – identified characteristics of the Graphite Creek deposit that may make the material a good fit for many of the high-tech and green energy sectors that are driving a large part of the growing market for graphite.
The graphite specializing consultant postulated that these distinctive characteristics could lend to different specialized applications with minimal processing.
Graphite One has coined the acronym STAX to describe these unique and naturally occurring properties.
Tests carried out by TRU found that more than 74 percent of the STAX flake graphite could be turned into spherical graphite without milling.
This is a monumental achievement considering that only about 40 percent of the best-performing flake graphite found in any other known deposit can be converted to spherical graphite, even using high-end equipment.
"From the time we identified the unique mineralization of our STAX graphite, we've observed a number of potential performance advantages," said Huston.
Domestic graphite producer
Establishing that the Graphite Creek deposit has both the size and graphite characteristics to be a domestic source of graphite for lithium-ion battery anodes, Graphite One completed a preliminary economic assessment for the project early in 2017.
This PEA outlines plans for a roughly 2,800-metric-ton processing facility at Graphite Creek that would produce 60,000 metric tons of graphite per year.
At the time, the deposit hosted 10.32 million metric tons of indicated resource containing 744,000 metric tons of graphite; plus 71.24 million metric tons of inferred resource with another 4.97 million metric tons of the graphitic carbon.
A six-hole infill drill program carried out in 2018 has upgraded and expanded these resources.
The best hole of the program cut two layers of graphite – 5.8 meters of 8.06 percent graphite from 27.8 meters and 16.3 meters of 11.93 percent graphite from 44 meters.
Other intercepts from the 2018 drilling include:
• 25.3 meters of 7.76 percent graphite;
• 8.5 meters of 10.81 percent graphite;
• 8.7 meters of 8.05 percent graphite;
• 4.6 meters of 12.27 percent graphite;
• 5.3 meters of 9.32 percent graphite;
• 20.5 meters of 7.71 percent graphite; and
• 1.7 meters of 25.14 percent graphite.
"Graphite Creek continues to show potential to be a significant domestic source of critical materials for electric vehicle batteries, power storage and various other critical and strategic end uses," said Huston.
With this drilling, Graphite Creek now hosts 10.95 million metric tons of measured and indicated resources averaging 7.8 percent (850,534 metric tons) graphite; plus 91.89 million metric tons of inferred resource averaging 8 percent (7.34 million metric tons) graphite.
This marks the first graphite reporting to the measured category; an 8 percent increase in grade and 14 percent increase in total graphite in the combined measured and indicated resource categories; and a 14 percent increase in grade and 48 percent increase in inferred resources, when compared to the resource calculation used to complete a preliminary economic assessment for the project in 2017.
"This increase in resources demonstrates the potential for a robust, high-grade U.S. graphite project," said Huston.
Graphite One will use the upgraded resource to advance the Graphite One project towards prefeasibility.
This higher level economic and engineering study will further investigate plans to ship concentrates from Graphite Creek to an advanced material processing facility that would refine them into an expected 41,850 metric tons of coated spherical graphite and 13,500 metric tons of purified graphite powders annually.
Graphite One would prefer to build this processing facility in Alaska but is also looking at locations in Washington, due to the lower cost power in the Pacific Northwest state.
Together, the mine and refinery are known as the Graphite One project.
"This PEA shows the strong potential of our project as America's emerging producer of lithium-ion battery-grade coated spherical graphite," said Huston.
"With the prospect of a low-cost, 40-year mine life using half of the identified graphite mineral resources and, given our projected production costs and conservative pricing assumptions, we are confident that Graphite One has the potential to become a reliable provider of graphite materials critical to clean-tech, high-tech and national security applications," the Graphite One CEO added.
Tapping AIDEA's expertise
To help with search for a viable Alaska locale to build the advanced graphite processing facility, Graphite One entered into a memorandum of understanding with the Alaska Industrial Development and Export Authority.
Alaska candidates for the facility would need to have reasonably priced electricity and adequate supply; industrial zoned land; be close to tidewater and port facilities; and infrastructure that allows easy access for the workers needed to operate the facility.
In a 2018 report, AIDEA identified four Southcentral Alaska locations – Homer, Kenai, Port Mackenzie and Seward – that meet the criteria and "are very interested in discussing this project with Graphite One management."
The development authority said Alaska has advantages that could outweigh the higher power costs at these sites, compared to sending the concentrates to the Lower 48 for further refinement.
"While Outside locations may provide cheaper power costs, Alaska is a mining and industrial friendly state that supports the development of value-added activities, and has a regulatory regime that supports responsible development while being less costly than other potential Northwest locations," AIDEA penned in the preliminary report.
Producing a significant portion of the coated spherical graphite needed for America's growing lithium-ion battery sector from Alaska mined ore would make the Far North state a domestic hub for this increasingly important critical mineral.
"Tapping AIDEA's expertise in helping us assess potential refinery sites is the first step towards making Alaska a key player in the clean-tech energy sector," said Huston. "The AIDEA report confirms the considerable interest Alaska localities have in serving as a base for our advanced-material spherical graphite refinery."
In my opinion it's not a matter of if, but when Tesla will officially announce their interest in Graphite One. The writing is on the wall. Elon Musk mentioned that Tesla might go into the mining business during their June shareholder meeting. A recent article in Mining News mentioned that Graphite One is collaborating with a major electric vehicle manufacturer.
11/15/2019, 9:21 am