Mosquito Pass

Graphite One scouts access routes to proposed mine

Graphite One Resources Inc. continued its efforts this summer to determine if a proposed graphite mine located on the northern slopes of the Kigluaik Mountains towards Imuruk Basin would be a feasible proposition.
According to the company’s new Chief Operating Officer Stan Foo, who took over from Dave Hembree, the field program has resulted in approximately 800 meters of core drilling in the deposit area for resource definition and for metallurgical samples. The company staged a work force of about 15 people at their camp at the Tisuk River and continued to sample surface water and conducted aerial fish reconnaissance surveys. They operated from late-July to early October, Foo said.
Also, the company is looking at different routes to build a road to the mine site. This summer, an Anchorage survey company, Recon, completed a so called LIDAR (Light Detection and Ranging) survey as well as ground surveys. Foo said the ground survey established survey control points along possible routes connecting to the Bob Blodgett Nome-Teller Highway and the Kougarok Road. Foo declined to say how many alternate routes were investigated and said repeatedly “several” possible access routes were looked at. “We do not have a final proposal on how to access the mine,” Foo stated in an email. “We will be looking at all alternatives — as the state and federal agencies will require us to do. We recognize that access is always a significant issue for any mine project.  Should a mine be proposed and the project progress to permitting, all reasonable access routes will be thoroughly evaluated for their environmental impacts.
“State and federal agencies have rigorous processes to determine environmentally preferred alternatives.
“There will be many opportunities for comment to us and the agencies during permitting,” Foo said.
Evidenced by Recon survey markers and the remnants of Tyvek foil, stakes and ropes, one of the routes scouted would veer off the Kougarok Road and head through Mosquito Pass, the Cobblestone and towards the mine site.
Currently, the Kigluaik Mountain range is mostly owned by the federal Bureau of Land Management. Tom Sparks, Associate Field Manager of the Anchorage Field Office, at the Nome field station, points to the 2008 Kobuk-Seward Peninsula approved resource management plan, which shows two designations for the area in question. One designation is the Mt. Osborn area of critical environmental concern and spans an area from Fall Creek in the west to east of Mt. Osborn. Another designation is the Salmon Lake-Kigluaik special recreation management area, which spans a greater area from the upper Cobblestone to the Kougarok Road in the east and the Teller Highway in the west. However, most of those lands that are currently held by BLM are state selected, meaning that eventually the land will be conveyed to the State of Alaska and designations under BLM would be a moot point.
As for the routes, Foo said the company will compare the advantages and disadvantages of the various route options from an engineering, economic and environmental perspective.  “We expect to select the preferred option from that analysis and propose it in the NEPA process.  The regulatory agencies will evaluate our preferred option and other alternatives through rigorous processes, including opportunities for public input, and determine the environmentally preferred alternative through the NEPA process.” Asked if the road would be a public use or closed industrial road, Foo said it has not been decided yet and may depend on the route and ownership of portions of the route.  “Our early feedback from the local communities is for any access road to be restricted to authorized use.  This will be a topic for additional public input during the permitting process,” Foo said.
 
How would the road be financed?
“We have no preferred option on financing the road at this time,” responded Foo. “The road would be financed by either equity from shareholders or debt financing from lending institutions.  A loan from AIDEA, one of the potential lending institutions, is an option; however, there has been no decision made regarding AIDEA’s future involvement.”
Senator Donny Olson earlier this year introduced a bill, SB 203, to the legislature. The bill proposes to authorize the Alaska Industrial Development and Export Authority, or AIDEA, to issue bonds to finance the infrastructure and construction costs of the Graphite Creek graphite project. Included in the infrastructure development would be “an access road and related infrastructure, port improvements, power generation. The infrastructure shall be owned and operated by AIDEA or financed under a statute spelling out AIDEA’s stake in a development project. The amount was not to exceed $80 million. The bill stalled in the Community and Regional Affairs Committee.
In the summer of 2017 Graphite One completed a Preliminary Economic Assessment. In it, the company outlined the proposal to mine graphite from the Graphite Creek property, process the ore into concentrate at a graphite processing plant at the mine site. Coated Spherical Graphite and other value-added graphite products would likely be manufactured from the concentrate at the Company’s proposed graphite product manufacturing facility, the location of which is the subject of further study and analysis
“At this time, we have no firm proposal on how a mine, if economically and environmentally feasible, would be constructed,” Foo wrote in an email to the Nugget. “We plan to undertake a Preliminary Feasibility Study and continue efforts to collect environmental baseline information in 2019.  Permitting could begin in a couple of years.”
According to a press release, the company will make a production decision once a feasibility study is completed. The same press release said that the “2018 Field Program follows on the July 19, 2018 closing of the final tranche of private placement financing that exceeded $4 million.”
Asked about the financing of the future exploration program, Foo said “the company has raised all of its funding to date through equity financing from a wide range of shareholders and we expect to continue doing so at least through to the completion of the feasibility study.”
 As of press time, the Graphite One (GPHOF) stock traded at 3.8 cents.

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