Mason is led by Benoit Gascon one of the only people to operate a graphite mine in North America (Company)

Mason is led by Benoit Gascon one of the only people to operate a graphite mine in North America (Company)

Mason Graphite (LLG:TSXV), the company developing one of the highest grade graphite deposits in the world, the Lac Gueret deposit, announced a large increase to the resource base of over 658%.  Lac Gueret now hosts a Measured and Indicated resource of over 50Mt at 15.6% Cg and another 2.6Mt of Inferred resource at 30.5% Cg.  The previous resource estimate, which was based on 25 drill holes, was comprised of roughly 7.6Mt in Measured and Indicated resource at an average grade 20.4% Cg.  Although the grade did come down slightly, the company believes the average grade estimated by the PEA of 27.4% Cg remains in tact.  Met-Chem, the group that completed the PEA in May of this year, confirmed that the conclusions of that report are still valid under the new resource model, although now the modeled PEA deposit only covers a fraction of the known mineralization.

The PEA shows a 22 year mine life with an average mineable grade of 27.4% Cg with a low-strip and $390 per tonne operating costs.  This large increase to the tonnage while remaining very high-grade lends itself to improved project economics in the next economic study.

“We are very pleased to see the success of our 2012 drilling program materialize in this updated mineral resource estimate”, commented Benoit Gascon, President and CEO of Mason Graphite. “We expect the scale of growth of our project to positively impact what is already expected to be an economical project. Results from the Lac Gueret Project continue to reinforce our belief in the world-class potential of this asset.”

Lac Gueret is a large flake, high-grade graphite deposit

Lac Gueret is a large flake, high-grade graphite deposit

This new resource estimate still leaves room for more deposit growth as the company notes that this latest estimate is based on one of two mineralized zones the company has identified.  The GC zone has seen 170 holes drilled into it which has identified 1.2km of strike length and 600m of width.  The mineral resource estimate is based almost entirely on drilling done at GC and it remains open in all directions.  The second zone, GR has only seen 18 holes drilled into it, but the company has already identified a prospective area 1km by 110m.  The GR is roughly 1km north of the GC zone.

Mason is led by Benoit Gascon who was the CEO of Stratmin Graphite which operates the Lac-des-Iles deposit; one of North America’s only producing graphite mines.  The company burned roughly $400,000 per month in the third quarter and is now sitting on $3.8 million in cash which at that rate will last them 3-4 months.

LLG shares were up over 25% to $0.50 per share at the time of writing.

Read: MASON GRAPHITE REPORTS 658% INCREASE IN MEASURED AND INDICATED MINERAL RESOURCES TO 50 MILLION TONNES, INCLUDING 6.7 MILLION TONNES GRADING 32.4% CG

Here’s a short interview Larry King recently did with Benoit Gascon:

LLG is a client.  This is an opinion and not investment advice.  Due your own due diligence.