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Nouveau Monde share price spikes after graphite sampling results

Published: 12:21 08 Jul 2013 EDT

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Shares in Quebec’s Nouveau Monde Mining Enterprise (CVE:NOU) spiked by more than half Monday on the back of news from the Gatineau-based explorer of the discovery of a high grade flake graphite zone on one of its properties, according to a statement released the same day.

Shares in the company hit 28 cents per share from a previous close of 18 cents hours after the news broke of favourable assay results from the company’s recent exploration program on the Matawinie graphite property.

Channel sampling on the property north of Montreal returned results of 15.16 per cent Cg (graphitic carbon) over 5 metres.  Five consecutive samples, each measuring 1 metre in length and approximately 4 cm in width, were collected on the Ti-Nou showing located on the property block sharing the same name.

Graphite mineralization was open in all directions and coincident to an electromagnetic airborne anomaly measuring about 2 km by 250 m, the company said. 

A total of 33 grab samples were collected, of which nine returned significant results ranging from 5 per cent to 16.8 per cent Cg, results that further expanded the graphite mineralization observed in the area during a 2012 reconnaissance property visit.

The property itself consists of a group of six claims, all of which fall within 50 kilometres of St-Michel-des-Saints in the Matawinie regional municipality, and are located at the eastern limit of the Central Metasedimentary belt of the Grenville geological province, host to many active graphite projects.

The host rocks in that region are graphitic crystalline marbles and paragneiss, similar to the host stratigraphy at Timcal's Lac des Iles graphite mine, currently Canada's only producing graphite mine.

The company has the option to acquire a 100 per cent interest in the property.

The field work, conducted in late May this year, targeted electromagnetic anomalies provided by the regional airborne geophysical survey carried-out earlier this year on the property.

The project is in line with Nouveau Monde’s business model, which is based on the generation of projects in new underexplored territories using advanced remote sensing and geophysical tools, an approach geared to save on exploration costs and maximize discovery chances.

 “Our exploration program on the Matawinie property area is a good example of our ability to generate quality projects from grassroot to drill-ready in underexplored territories using our expertise in implementing regional remote sensing and geophysical campaigns in the right geological context,” said president and CEO of Nouveau Monde, Eric Desaulniers, in a company statement accompanying the drilling results.

“The excellent exploration results achieved during the ground follow-up phase are leading us to start a drilling campaign in the upcoming weeks."

Graphite is a commodity poised to benefit from an anticipated surge in demand, coupled with an expected decline in supply over the coming years. Industry sources put the current size of the natural graphite market around 1 million tonnes per annum, and while more than 70 per cent of the world’s graphite supply originates in China, most mines in Shandong Province – one of two main graphite producers – are believed to be nearly exhausted.

Shares in the company were trading up on the TSX Venture Exchange, lately adding 3 cents to the stock's previous close to hit 21 cents per share, an increment of more than 16 per cent as of 12:15pm EST.

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on 06/01/2021