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In a landmark deal that is expected to further solidify Quebec as a major North American hub for the enormous quantities of graphite needed for the lithium-ion batteries powering the electric vehicle revolution, Nouveau Monde Graphite Inc. has agreed to invest in advancing Mason Graphite Inc.'s Lac Guéret graphite project toward development.

Under an option and joint venture agreement announced on May 16, Nouveau Monde will invest up to C$5 million into the equity of Mason Graphite and at least C$10 million into the Lac Guéret project, including the completion of an updated feasibility study for a mine that would produce at least 250,000 metric tons of graphite concentrate per year.

Upon completion of the terms of the agreement, Nouveau Monde will earn a 51% joint venture interest in Lac Guéret.

"The partnership announced today has the potential to propel Québec's graphite industry on the world stage and consolidate its position as a leader in North America," said Quebec Minister of Economy and Innovation Pierre Fitzgibbon. "By combining the strengths of the two most advanced projects in North America, both of which located in Québec, we are solidifying our battery value chain."

High-grade potential

Located about 175 miles (285 kilometers) north of Baie-Comeau, a Quebec town on the shores of the St. Lawrence River, Lac Guéret hosts a very high-grade graphite deposit that would complement Nouveau Monde's Matawinie graphite mine being developed about 380 miles (610 kilometers) to the southwest.

Lac Guéret hosts 65.54 million metric tons of measured and indicated resources averaging an impressive 17.2% (11.27 million metric tons) graphite.

A feasibility study completed for Mason in 2018 detailed the development of a mine at Lac Guéret that would produce an average of 51,900 metric tons of graphite concentrate annually for 25 years.

The mine considered in the economic and engineering study was based on 4.7 million metric tons of reserves averaging 27.8% graphite, a particularly high-grade but small fraction of the larger resource available.

As part of its JV earn-in, Nouveau Monde will investigate the potential of a nearly five times larger operation to feed graphite into the EV battery supply chain.

This aligns well with Quebec's strategy to leverage its abundance of battery raw materials to establish a complete EV supply chain within the Canadian province that includes mines, battery materials processing facilities, lithium-ion battery manufacturing and recycling plants, and increased EV production.

"I am delighted to see the creation of this alliance, which combines and leverages the best attributes of the North American graphite industry in support of the ambitious vision of the Government of Québec," said Mason Graphite Chairman Fahad Al-Tamimi.

First, Matawinie mine

In the meantime, Nouveau Monde is developing a mine at Matawinie that will produce 100,000 metric tons of graphite concentrate annually over an initial 26-year mine life, based on 59.8 million metric tons of reserves averaging 4.35% graphite.

Utilizing the abundant hydropower available in Quebec and battery-electric mining equipment being developed for Matawinie by Caterpillar Inc., Nouveau Monde intends to shrink the carbon dioxide footprint of all its operations to net-zero.

The high-purity flake graphite produced at its mine near Saint-Michel-des-Saints will be trucked roughly 95 miles (150 kilometers) to its advanced material plant at Becancour, where it will be upgraded to the coated spherical graphite that serves as the anode material in most lithium-ion batteries.

A small Quebec town along the shores of the St. Lawrence River about midway between Montreal and Quebec City, Becancour has emerged as an epicenter for producing the advanced materials needed for EV batteries. General Motors, POSCO Chemical, and BASF are among the auto and battery materials manufacturers that have set up shop in this area of Quebec that has become known as Canada's "Battery Valley."

Lac Guéret has the potential to deliver even more graphite concentrates to Battery Valley as the EV market continues to heat up.

"The Matawinie and the Lac Guéret deposits are instrumental in establishing a strong, meaningful and resilient local supply of lithium-ion anode material to cater to the electric vehicle market expansion in the Western World and beyond," said Nouveau Monde Graphite President and CEO Eric Desaulniers. "This transaction has the potential to strengthen our phased development approach and provide us with significant volumes, therefore indicating to our large prospective tier-1 customers that we have a robust and realistic growth strategy and the ambition of being their preferred supplier for the generation to come."

In addition to advanced anode material for lithium-ion batteries, some of Nouveau Monde's graphite could be transformed into graphene, a 2D form of graphite with special properties used in a growing number of high-tech and medical products.

Black Swan Graphene Inc., a subsidiary of Mason, has developed a process for exfoliating graphene from graphite at large volumes.

Nouveau Monde Graphite Inc.

Nouveau Monde's coated spherical purified graphite plant is being developed in an industrial park with ready access to rail and a Lawrence River port in Becancour, Quebec.

Nouveau Monde intends to enter into a preliminary agreement for the implementation of Black Swan's graphene processing technology into its 1,000-metric-ton-per-year graphite concentrate demonstration plant at Matawinie. Under the tentative deal, it is expected that the Black Swan process would utilize Matawinie ore averaging 4.5% graphitic carbon to establish a fully integrated graphene facility.

Al-Tamimi said the installation of Black Swan Graphene technology in Nouveau Monde's processing facility "should greatly accelerate the path towards large scale graphene production and is sure to create considerable value for the shareholders of Mason Graphite."

With graphene emerging as an important ingredient in high-performance rechargeable batteries, commercial-scale production of this 2D miracle material could further Quebec's ultimate goal.

"These projects contribute to our ambition to build an integrated value chain, from mining to recycling, and to position Québec at the forefront of electrification," said Fitzgibbon.