Lomiko Metals (LMR-V)
In a now familiar story for Canada’s graphite mines, the discovery of Quatre Milles occurred at a time when the Chinese were flooding the market, forcing the delay of the mine’s development until now. With a project highlight drill result of 28.6 meters at 8.07% graphite (Cg), and most test holes averaging at least 4% graphite, Quatre Milles is thought to hold a minimum grade twice that of Northern Graphite.
Lomiko has 41% inside ownership including long-term holders Byron and Pinetree Capital. Lomiko will attract favorable financings because the project is considered low risk with high margin potential and is not capital intensive. With a clear plan and strategy, it should not be hard for Lomiko to raise $5M to $10M needed to develop Quatre Milles over the next 18 months and still be well under 100M fully diluted when it comes to financing mine construction. When Focus Metals came to the market with Lac Knife in 2010 at between $0.05 and $0.10 the company has successfully increased their share price 10 fold and raised well over $30M in financings and warrants for Lac knife.
Investing highlights…Exciting Graphite Discovery!· High Purity Large Flake Graphite (Battery grade)· Large target multiple graphite zones – deposit wide open· Advanced – drill tested – low risk exploration· 28.6 meters grading 8.07% graphite· Holes average 4% – 8% with peak value of 15%· 1Mt resource potentialLocated in the top mining region in the world· Quebec (exploration tax credits)· Located near Canada’s largest operating graphite mine· Potential mining synergies· Fast-track potential – drilling as early as Feb.Great Value – Even Better Value Creation!!· LMR currently undervalued at $0.075 and $4M market cap· $10M acquisition value· Potential >$100M market cap graphite minerGraphite… A metal entering criticality· Graphite forecasts increasing demand from ~1Mt to ~2.5Mt over the next 10 year cycle· Several graphite mines needed to meet upcoming demand 10 – 20 (depending on size)· Current prices expected to increase further due to Chinese restrictions, little substitution and no new supplyGreat Economics!!!· High degree of price sensitivity @ 6%· HIGH NPV / HIGH IRR / LOW CAP-EX· Potential to fast–track to production (3 years)