Focus Graphite Inc. has received formal interest from FLSmidth to further evaluate their Lac Knife Project, providing a comprehensive “One Source” solution for engineering & technical services and the supply of mineral processing equipment. The proposed mineral processing equipment for the Lac Knife project is estimated to cost $12 million and may include a second component for dewatering, filtration, and conveyance equipment for tailings management.
The addition of a revised tailings management system in the Environmental and Social Impact Assessment report aims to reduce the environmental impact of Lac Knife’s site layout. FLSmidth, a Danish multinational corporation with expertise in mineral processing equipment and dry-stacked tailings management, sees potential in the project and has introduced it to the Danish Export Credit Agency for potential credit support.
Focus Graphite President and Chief Operating Officer, Don Baxter, views FLS’s interest as a significant financing option for the company’s structured project financing. The potential debt facility represents 7% of Lac Knife’s total project financing requirements, adding to the total vendor financing potential of approximately 20%.
This announcement follows the recent Caterpillar Structured Finance announcement as Focus continues project-financing discussions with stakeholders and investors. With a goal of minimizing shareholder dilution, the company is exploring a mix of debt and equity financing options for the project.
The Lac Knife Project Feasibility Study, published in August 2014, highlighted the economic viability of the project with a capital expenditure requirement of $165.6 million. With continued interest and support from key stakeholders, Focus Graphite is well-positioned to advance the Lac Knife Project and establish itself as a low-cost producer of technology-grade graphite.
