Mar. 7, 2012 – With increasing demand for graphite, global graphite market has breathed new life into a mine northeast of Huntsville, near the border of Algonquin Park, that was closed almost 18 years ago.
It is an economically depressed area where the up to 80 jobs created at the small open-pit mine operation will be a welcome addition.
"If everything comes together we will be open in September of this year,” Tom Myatt, president and chief financial officer of Ontario Graphite Ltd., added there are only two other graphite mines in North America, one in Quebec and the other in B.C.
"We saw that the increase in the pricing and the increase in the demand for the product justified us going back in there and reopening it,” he said.
The one irritant for Ontario Graphite Inc. has been lack of broadband service in the area, making Internet communications difficult.
Ordinarily open-pit mines are a magnet for controversy, but so far even the cottagers aren’t fussed and the mayor of the closest village of Kearney says the new jobs are exactly what the area needs.
Demand for the most part is tied to the steel industry, where graphite is used to increase the carbon content of steel and is used as a liner for ladles and in bricks for furnaces, because it can withstand temperatures of 3,600 C. Other industrial uses include brake linings, gaskets, batteries, lubricants, fire retardants, and reinforcements in plastics.
Demand for graphite has been growing at about 5 per cent a year and could jump even more because of green initiatives such as battery-powered vehicles, fuel cells and solar energy.
The first hurdle for reopening the graphite operation was to get the Ministry of Northern Development and Mines to approve the company’s closure plan, which spells out exactly what it will do with the site once the graphite is played out, and provides a guarantee there will be money to close it properly.
A side issue for the mine is the fact that until the company puts up a satellite dish, the operation will be in communication darkness.
The lack of phone and Internet infrastructure is a long-standing issue for the area, Kearney Mayor Paul Tomlinson said.
Aided by cottagers, he has been after Bell Canada and the federal and provincial governments to serve the area with fibre-optic cables and cell coverage, but the requests have been met with polite rebuff.
As for the mine being reopened, Tomlinson said, “there are more positives than negatives.”
People in Kearney, population 800, “are very excited about this,” he said, and nearby Huntsville, which has 18,000 residents and has been hit with job losses, will also benefit.
Ron Duff, president of the Grass and Loon Lakes Residents Group, said “generally speaking” the relatively remote mine will be a positive addition.
"I think once people have the right information they will see the benefits,” Duff said.
There is enough graphite at the site to keep the mine going for at least 30 years, Myatt said. Before it was shut, it had operated on and off for about four years.
Ontario Graphite has about $60 million worth of mine and mill infrastructure at the site and has raised about $23 million, which the company says is sufficient to fully fund the project through the restart of production and beyond.
After rock from the mine has been ground to sand and mixed with water, the graphite floats to the surface, looking “kind of like pepper flakes,” Myatt said.
High quality graphite flake sells now for $2,200 to $3,000 a tonne. “We’ll produce about 20,000 tonnes a year, which is maybe about four or five truckloads a week,” Myatt said.
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