Strike Graphite Corp.

Strike Graphite Corp.

February 14, 2012 08:30 ET

Strike Graphite Corp. Acquires Wagon Graphite Project in Quebec in Vicinity of Timcal's Lac des Iles Graphite Mine

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 14, 2012) - Strike Graphite Corp. (TSX VENTURE:SRK) (the "Company" or "Strike") is pleased to announce that it has signed an agreement to acquire a 100-per-cent interest in the Wagon Graphite Property located in southwestern Quebec.

The Wagon Property consists of three separate claim blocks totaling approximately 3,000 hectares situated within the vicinity (approx. 15 km east) of Timcal's Lac des Iles Graphite Mine, 150 km northwest of Montreal. Lac des Iles is the largest of two Canadian graphite producers. It has been in production for over twenty years and produces graphite products of various sizes and purities.

The Wagon Property was originally explored by Graphicor Resources Inc. ("Graphicor") in 1989 based on the results of a helicopter-borne EM survey. Ground exploration followed in 1990.

The geology of the property is consistent with the Central Metasedimentary Belt of the Grenville Province and includes quartzofeldspathic rocks, quartzite, biotite gneiss, marble and locally pegmatitic quartzofeldspathic rocks. Graphite is locally present in quartzite and biotite gneiss and in shear zones where the graphite content usually ranges from 3% to 7% Cg exhibiting flakes up to 3 mm in diameter. Large flake graphite is generally considered as 0.2 mm and above.

Prospecting and reconnaissance geological mapping followed by line cutting and multifrequency-coil separation Maxmin II and Mise-à-la-Masse surveys identified multiple zones of parallel conductors. According to reports by Derry, Michener, Booth & Wahl ("DMBW"), graphite is present in all lithologies on the property. DMBW wrote: "Diamond drilling is warranted to test the prospective regions of this property."

About one hundred outcrops were located on the property. 15 were sampled and returned assays of 0.57% to 18.13% Cg. The highest grades were more frequently from the paragneiss lithologies. The property covers 18 km strike length of the formations.

Wagon Property - Sampling Results

Area Outcrop number Sample Number Percent Graphite
North Block K1 51001 13.73
K3 51002 1.31
K4 51003 7.83
K6 51004 1.88
K7 51005 4.36
K9 51006 2.07
K10 51007 5.33
Center Block K27 na 4.17
K31 na 4.78
K33 na 3.45
K34 na 2.01
na 42413 2.07
na 42414 3.27
na 42415 2.64
na 42416 14.14
East Block na 42418 1.02
na 42419 0.57
na 42420 1.22
na 42421 18.13

Maps are available for download on the Company's website at:

The Company cautions that it has not verified the quality and accuracy of the historic sampling results reported in this news release which predate the introduction of National Instrument 43-101 and cautions readers not to rely upon them. The historic figures were generated from sources believed to be reliable, however, they have not been confirmed. Although the sampling results are relevant, they have not been verified.

Strike plans to mount an aggressive exploration campaign on the property commencing with a complete compilation of historic geologic work followed by surface mapping, prospecting, mineral testing and processing, and follow-up diamond drilling.

Graphite Market

Global consumption of natural graphite has increased from ~600,000 in 2000 to 1.2 MM t in 2012. Demand for graphite has been increasing by approximately 5% per year since 2000 due to the ongoing modernization of China, India and other emerging economies, resulting in strong demand from traditional end uses such as the steel and automotive industries. Graphite also has many important new applications such as lithium ion batteries, fuel cells and nuclear and solar power that have the potential to create significant incremental demand growth. There is roughly 20-30 times more graphite required by weight to produce a lithium-ion battery than there is lithium. Demand for graphite is expected to rise as electric vehicles and lithium battery technology are adopted as well as increasing uses in new technology applications.

Natural graphite comes in several forms: flake, amorphous and lump. Of the 1.2 million tonnes of graphite produced annually, approximately 40% is of the most desirable flake type. China, which produces about 73% of the world's graphite, is seeing production and export growth leveling and export taxes and a licensing system have been instituted. A recent European Commission study regarding the criticality of 41 different materials to the European economy included graphite among the 14 materials high in both economic importance and supply risk (Critical Raw Materials for the EU, July 2010). Graphite prices have been increasing in recent months and over the last couple of years prices for large flake, high purity graphite (+80 mesh, 94-97%C) have more than doubled.


Strike has an option to earn a 100-per-cent interest in the Wagon Property from Zimtu Capital Corp. and three of their prospecting partners by making the following payments and issuing the following common shares to the vendors: i) $15,000 upon signing the letter agreement, ii) $15,000 and 500,000 common shares on receipt of the TSX Venture Exchange ("TSX-V") acceptance of the agreement, iii) $20,000 and 500,000 common shares six months from TSX-V acceptance, iv) 500,000 common shares 12 months from TSX-V acceptance. During the period which is 12 months from the date of TSX-V acceptance, Strike will complete a minimum of C$100,000 of exploration on the Property. The vendors will retain a 2-per-cent net smelter royalty on the property.

A finder's fee will be payable with respect to the acquisition pursuant to the policies of the TSX Venture Exchange.

Jean-Sebastien Lavallée (OGQ #773), geologist, a Qualified Person as defined by National Instrument 43-101, has reviewed and approved the technical content of this release.

Due to an aggressive focus on graphite exploration and its North American projects, Strike has elected to drop the acquisition of the BOMA project in Tanzania, reported earlier in the Company's news release of October 17, 2011.

About Strike Graphite Corp.

Strike Graphite Corp. is an exploration company with a seasoned management team targeting strategic assets on a global scale. In addition to the Wagon, Deep Bay East and Simon Lake Graphite Properties, the Company is also active advancing its Satterly Lake Gold Project in northwestern Ontario.


Geoff Balderson, President

We seek safe harbor.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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