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This strategy is a significant departure from the company’s original intention to reopen the Lochaber mine site, he adds. “Through a number of circumstances, we discovered the Matheson facility was sitting unused with micronization equipment. So we rearranged components of our business plan and moved the micronization ahead of the mining piece and struck a five-year lease with an option to extend it for another five years. Now we have the facility, a supply of graphite feedstock and the personnel — including two key players, Mike Coscia, senior vice-president of sales, and Jerry Janik, chief operating officer — to pursue potential market opportunities.”

In time, Great Lakes Graphite may transition to mining its own graphite to improve margins further, he adds. “Right now we’re focusing on getting revenues going as fast as we can.”

Production at Matheson is expected to reach 500 tonnes by the end of 2015 and scale up to 3,500 tonnes in 2016. “By 2017, we will reach 10,000 as we go up the value-add ‘ladder’ into more sophisticated markets,” Ferguson says.

The further up the ladder one travels, the greater the revenue potential. By way of comparison, the total cost to bring in graphite for processing is $1,200 per tonne. Micronized material pricing averages around $3,000 per tonne, while highly purified carbon (99.5% pure) for advanced applications such as lithium batteries can fetch up to $7,500 a tonne.

Ben Kramer-Miller, chief analyst with Mining Wealth, a subscription service newsletter investment service in Chicago, says Great Lakes’ approach is sound. “The difficulty in graphite is not getting it out of the ground. The real value is turning it into something useful in various industries and selling it. That’s the area where most graphite companies have failed. Great Lakes, however, has put the right pieces in place to succeed because it understands that there is money to be made in buying, upgrading and selling consistent quality products that are valuable to end users.”