Oar Resources Limited (ASX:OAR) continues to make progress at its Oar Graphite Project in the Western Eyre Peninsula, South Australia, with the initiation of graphite sample testing and the acquisition of required permits in preparation for an upcoming Air Core (AC) drilling program.
OAR has made several positive advancements at the Project, which has resulted in an improved confidence in the potential for the Oar Graphite Project to become a flake graphite critical mineral deposit.
Geophysical surveys were conducted across the Project by Terra Resources, which were successful in highlighting areas of graphite mineralisation.
These areas will be tested through OARs upcoming AC drilling program with the goal of significantly adding to the current indicated and inferred Mineral Resource Estimate of 13.47Mt @ 3.3% TGC, including 6.31Mt @ 4.7%TGC1.
OAR dispatched eight samples from two historic holes at the Project for metallurgical analysis to the Beijing General Research Institute of Mining and Metallurgy (BGRIMM) in China, with the goal of producing a saleable graphite product. OAR is now partaking in discussions with one of the world’s largest anode producers to evaluate product from metallurgical test work.
Upcoming Drill Program
The ongoing drilling and geological analysis at the Project have identified an unconsolidated layer of clays and sand, ranging from 20 to 30 metres in thickness, overlying a saprolite that extends from 20 to 40 metres in depth. This saprolite has developed in the Archean basement.
The Company has obtained approval for the Exploration Program for Environmental Protection and Rehabilitation (EPEPR) concerning the 5,000-metre AC drilling initiative. This program aims to explore additional geophysical target areas and extend the current Mineral Resource Estimate (MRE).
The Next Steps
The metallurgical results for the samples sent to China are currently pending, and OAR expects to receive them within the next four months.
Positive outcomes will play a crucial role in guiding the Company’s strategic planning, leading to the initiation of a more comprehensive drill-out of the Project to expand the existing MRE.
OAR intends to kickstart bench-scale metallurgical test work to develop a scalable processing flowsheet, allowing for the production of a marketable product. This phase can commence promptly upon receiving favourable results from China, as the Company still possesses ample samples from the 2015 drilling activities.
If everything proceeds as planned, this development will significantly impact the Company’s capacity to undertake pilot-scale processing studies. This, in turn, will expedite OAR’s ability to establish strategic partnerships with offtake partners, bringing about mutually beneficial collaborations within a shorter timeframe.
Graphite & China
Positioned strategically in the Western Eyre Peninsula, OAR is well-positioned to realise its objectives of expediting graphite exploration and formulating plans for future production.
This strategic location gains significance in light of the growing demand for graphite as a critical mineral, particularly following China’s export restrictions.
Graphite’s crucial role in the global shift toward green energy amplifies its importance. As a much-needed component, graphite deposits in western countries assume heightened value.
The fast-growing sector of graphite is pivotal in supplying components for the burgeoning solar and wind industries, as well as meeting the demands of battery manufacturers. OAR’s strategic position thus aligns with the broader trends and demands shaping the landscape of graphite exploration and production.
In October, China declared the necessity for export permits on certain graphite products to safeguard national security. This move triggered a broader effort in Western nations to manage the supply of critical minerals, responding to concerns about China’s dominant role in global manufacturing.
As the largest graphite producer globally, China’s control over significant portions of the graphite supply has resulted in considerable tension across the global supply chain. This development has particularly impacted the Eyre Peninsula in South Australia, known for its concentration of graphite projects, positioning OAR to capitalise on the evolving market conditions in this region.
OAR Resources Managing Director Paul Stephen said that the Company is making progress at the Project.
“Our team has been working closely alongside a range of critical minerals development experts to accelerate momentum at Oakdale Graphite Project and test our product throughout various stages of the graphite supply chain,” he said.
“As well as progressing a 5,000m RC drilling campaign at Oakdale to test graphite mineralisation detected through geophysical surveys, OAR is working on multiple fronts to extract maximum value from our sizable landholding and critical mineral interests on the Western Eyre Peninsula.”
OAR’s Australian Stock Exchange-listed share price is currently trading at $0.004 (11:20am UTC+ 8 hours).