Strategic Graphite to restart operations at world class Uley Graphite project

Highlights:

• Newly appointed & industry experienced CEO Christopher Darby to lead team
• Plans are in place to re-commence operations at the Uley Graphite mine into early 2014
• Patersons appointed as Corporate Adviser in relation to capital raising and ASX listing
• New ASX listing for Strategic Graphite Limited planned by late 2013

Obviously with some confidence in future demand for the product together with the low CapEx they’ve decided to move without an international partner. Perhaps they’ve timed the right phase in the cycle?

Link: http://www.asx.com.au/asxpdf/20130821/pdf/42ht0prjy83zd0.pdf

@Tim Ainsworth: thanks, as always, for the clarification :-) The SER folks, when I asked, mentioned the 20% that they owned, but omitted to mention that the rest was held by SER shareholders – good to know. Definitely a project we’ll be keeping an eye on, especially, as you said, because of the potentially low capex required.

Just a little clarification re Uley. As part of the deal with Mega SER agreed to break out Uley into an unlisted subsidiary which would then have been merged into Mega in exchange for equity, once conditions were satisfied. After the demerger SER gave Mega two extensions to meet the terms of the deal which they failed to do and the agreement was cancelled Nov 12. Uley was never in Mega’s ownership despite their spruiking to the contrary.

So Uley now sits in the unlisted Strategic Graphite Limited, with SER holding 20% equity. As the remain 80% was distributed pro rata to SER SH’s the controlling interests are effectively the same.

One clause in the Mega agreement allowed them to process and sell stockpiled material from previous operation to recoup funds spent on refurbishment in the event of the deal not proceeding. There is no advice that this has occurred but it is potentially an overhang on further development.

To that end SG has continued to sponsor the research at Monash University:

http://www.strategicenergy.com.au/pdf/29-5-2013/20130529%20-%20Strategic%20Energy%20-%20Uley%20Graphite%20suitable%20for%20production%20of%20highly%20commercial%20graphene.pdf

Completed an engineering study:

http://www.strategicenergy.com.au/pdf/22-4-2013/20130422%20ASX%20Release%20-%20April%20Scoping%20Eng%20MM%20-%20ASX%20FINAL.pdf

We await further news but it still holds the potential to be a near term producer with modest CapEx.