Slocan Valley Flake Graphite Project
The Slocan Valley, thanks to very unique geological processes, is very prospective for high quality, near-surface flake graphite and features western North America's only producing natural flake graphite mine which is operated by privately-held Eagle Graphite Corporation. The potential world class deposit is 21 kilometres due west of Rainbow's Gold Viking Property, part of the Big Strike Gold-Silver Project, while Eagle Graphite's processing plant (mill site) is approximately 20 km to the south near Nelson (see map below).
Eagle Graphite and Rainbow are the largest landholders in the area (the Valhalla Metamorphic Complex). Rainbow recently staked claims covering more than 5,500 hectares based on favorable geology and location. This is beyond the original 4,200 hectares in two large claim blocks that RBW acquired through staking last spring. Flake graphite occurrences have been reported over a nearly 30-km north-south stretch of this under-explored region that has the potential of becoming one of the world's largest flake graphite districts with a processing plant already in place.
Eagle Graphite's mine site in the Slocan Valley
"We plan to grow our production capacity several times over," stated Jamie Deith, President of Eagle Graphite, in a recent interview with Resource World Magazine. "Demand for our product is very strong, and we want to use this opportunity to establish ourselves as a leading producer. It will require a moderate amount of capital to get there, but we feel that the market is becoming increasingly receptive to graphite mining."
Rainbow Graphite Claim Block #1
Rainbow holds a 12.5-km-long claim block, totalling 2,100 hectares and flanked on either side by Eagle Graphite claims, beginning five km northeast of Eagle Graphite's mill site and immediately north of the highly prospective Blu Starr Property. Anglo-Swiss reported May 9, 2012, that up to 15% graphite has been mapped in outcrop over the northern part of its Blue Starr Property and appears to be associated with a 3-km-long electromagnetic (EM) anomaly identified in an airborne geophysical survey completed in 2010. Less than 25% of the property was covered by the airborne survey.
Rainbow Graphite Claim Block #2
Rainbow also holds a 9-km-wide claim block, also totalling 2,100 hectares, contiguous to the southern boundary of Blu Starr.
Additional Rainbow Graphite Claims
During the last half of 2012, Rainbow has staked more than 5,500 hectares of additional claims prospective for near-surface flake graphite including ground contiguous to the Eagle Graphite processing mill.
"It appears that part of the Slocan Valley - the Valhalla Metamorphic Complex - has undergone some very unique geological processes that have created highly favourable conditions for high quality, near-surface flake graphite," explained Rainbow President David W. Johnston. "The host rocks are ideal. Something special has been cooked up here. Rainbow has the boots on the ground and the right geological team to take advantage of this graphite opportunity in the immediate vicinity of our flagship Big Strike Project."
Graphitic Outcrops Discovered On RBW Claims
Initial prospecting has confirmed the presence of graphite bearing rocks on RBW's claims. Work continues. Below is just one sample (with flakes) from RBW's northern claim block.
Graphite is an important industrial mineral. Graphite and diamonds, in fact, are the only two naturally formed polymers of carbon. Graphite is essentially a two dimensional, planar crystal structure whereas diamonds are a three dimensional structure.
Graphite is an excellent conductor of heat and electricity, and has the highest natural strength and stiffness of any material. At the same time, it's one of the lightest of all reinforcing agents and has high natural lubricity, making it especially valuable to the steel and automotive industries.
Graphite is a major component of lithium batteries - lighter and more powerful than traditional batteries - that are finding their way into ever broader markets, from laptops and cordless power tools to hybrid electric vehicles.
According to the U.S. Geological Survey, the major uses of natural graphite in 2011 were estimated to be:
Refractory applications and crucibles combined, 33%;
Foundry operations and steelmaking combined, 26%;
Brake linings, 7%;
Batteries and lubricants combined, 5%;
Other applications, 29%
Graphite fits into two primary classifications: natural graphite and synthetic graphite. Natural graphite, which is a third of the cost of synthetic graphite, exists in three forms: flake, amorphous, and vein or lump graphite. The most desirable and expensive of all three is flake graphite, which is produced from less than a half of the world's graphite mines and is suitable for high-tech applications. Only synthetic graphite produced from petroleum coke can serve as a substitute for costly flake, but that process is quite expensive due in part to high oil prices.
Consumption of flake graphite is growing as amorphous graphite consumption falls and accounts for at least 50 percent of consumption in mature industrialized economies.
Graphite Demand & Supply
The graphite market has been compared to the market for rare earth metals: they're both deemed "critical" by several countries, and China - one of the world's leading producers - has tightened supply. In fact, in 2011 about 65% of global graphite mine production came from China, followed by 15% from India. China holds 71% of the global graphite reserves, again followed by India with 14%. Brazil, North Korea, Austria and Canada also produce graphite.
Graphite demand, driven by Asian steel and auto markets, has grown by 5% annually over the last decade to about 1.14 million tonnes (the estimated worldwide market in 2011 was $12 billion). This is split nearly evenly between the large flake variety and amorphous graphite used for industrial purposes, according to Industrial Minerals.