Lac Carheil’s Expanded Graphite Resource Could Slash Mining Costs—But Will Funding Follow?

Significant Resource Expansion at Lac Carheil

Metals Australia Ltd (ASX, MLS) has announced a major milestone in the development of its Lac Carheil high-grade flake-graphite project in Quebec, Canada. The company’s recently completed 9,538-meter diamond drilling program has yielded a remarkable ~595% increase in graphitic carbon intercepts compared to the original resource base. This substantial addition of nearly 5 kilometers of graphitic carbon intervals is poised to underpin an updated Mineral Resource Estimate (MRE) due for release this quarter.

Notably, the drilling has confirmed a continuous graphite strike length of 2.3 kilometers across four zones, including a newly identified southeast (SE) extension zone. This new zone alone accounts for 2,777 meters of graphitic carbon with a weighted mean grade of 12.4% Total Graphitic Carbon (TGC), positioning it as a priority target for early production phases.

Enhanced Orebody Definition and Mining Prospects

The expanded drilling has not only increased the volume of graphite but also improved the understanding of orebody geometry. In the SE resource zone, additional drilling has extended graphite mineralization closer to surface and revealed wider and deeper zones than previously recognized. This improved definition is expected to reduce stripping ratios significantly, lowering both operational and capital expenditures in mining.

Continuity between the original northwest (NW) and SE resource zones has been established through the connector zone drilling, supporting the development of a single, extensive open-pit mine. The average graphite grade in this corridor is 9.0% TGC, further enhancing the project’s overall resource quality.

Advancing Mine Planning and Infrastructure Design

To capitalize on these drilling results, Metals Australia has appointed DRA Americas Inc., a Canadian mining consultancy, to lead the mine planning and infrastructure design components of the ongoing Pre-Feasibility Study (PFS). This includes optimizing the extraction sequence, establishing the Ore Reserve, and designing essential mine infrastructure such as haul roads, stockpiles, and overburden disposal facilities.

Complementing the mine development, the company is progressing downstream processing studies with Dorfner Anzaplan, focusing on battery anode material production. This aligns with the strategic goal of supplying premium battery-grade graphite to the North American lithium-ion electric vehicle market.

Strategic Funding and Future Outlook

Metals Australia is actively pursuing grant funding to support infrastructure development, including hydroelectric power supply and access road construction, through Canadian government programs. The company has also submitted proposals to the U.S. Department of Defense to secure funding for domestic battery anode material supply chains, reflecting the geopolitical importance of critical minerals.

With the MRE update imminent and the PFS advancing, Metals Australia is well positioned to unlock the multi-decade potential of the Lac Carheil project. The enhanced resource base and improved mine plan are expected to strengthen project economics and attract further investment.