{"id":59525,"date":"2012-02-20T09:49:27","date_gmt":"2012-02-19T22:49:27","guid":{"rendered":"http:\/\/www.fnarena.com\/index.php\/2012\/02\/20\/graphite-pencil-it-in\/"},"modified":"2012-02-20T09:49:27","modified_gmt":"2012-02-19T22:49:27","slug":"graphite-pencil-it-in","status":"publish","type":"post","link":"https:\/\/staging.fnarena.com\/index.php\/2012\/02\/20\/graphite-pencil-it-in\/","title":{"rendered":"Graphite: Pencil It In"},"content":{"rendered":"<p>\n\tBy Richard (Rick) Mills<\/p>\n<p>\n\t<em>As a general rule, the most successful man in life is the man who has the best information<\/em><\/p>\n<p>\n\tSometime between 1500 and 1565 a large graphite deposit was discovered in <span>Cumbria<\/span>, England. Because the graphite was extremely pure and solid it could easily be sawed into sticks. The graphite was actually thought to be a form of lead and called plumbago &#8211; Latin for lead ore.<\/p>\n<p>\n\tThe <span>Borrowable<\/span> Mine was soon ordered to be put under armed guard by Queen Elizabeth because the &ldquo;lead&rdquo; could be used to line the <span>moulds<\/span> for making her armies cannonballs. But black marketers managed to smuggle out the graphite for continued use in pencils. Artists from all over the known world quickly learned to appreciate the qualities of <span>Cumbria&rsquo;s<\/span> graphite but it wasn&rsquo;t until 1795 that Nicholas <span>Conte<\/span> learned to mix graphite powder with clay and fire it in a furnace to actually make something with the equivalent quality of <span>Borrowables<\/span> plumbago.<\/p>\n<p>\n\tToday graphite (named for the Greek word meaning &quot;to write&quot;) is attracting the attention of investors, and for just as good a reason as it once attracted all those artists 500 years ago.<\/p>\n<p>\n\t<strong>Carbon<\/strong><\/p>\n<p>\n\tBy mass carbon is the fourth most abundant element in the universe (after hydrogen, helium, and oxygen) and it&rsquo;s the <span>15th<\/span> most abundant element in the Earth&#039;s crust. Carbon is present in all known life forms and is the second (oxygen is first) most abundant element by mass &#8211; about 18.5% &#8211; in the human body.<\/p>\n<p>\n\tCarbon is the stuff of life, it is the foundation, the chemical basis, of every living thing on Earth, yet because of its pervasive familiarity we all take it for granted.<\/p>\n<p>\n\tAs investors we might want to rethink that.<\/p>\n<p>\n\tAllotropes are structural modifications of an element &#8211; the allotropes of carbon include:<\/p>\n<ul>\n<li>\n\t\tDiamond &#8211; The carbon atoms are bonded together in a tetrahedral lattice arrangement<\/li>\n<li>\n\t\t<span>Fullerenes<\/span> &#8211; The carbon atoms are bonded together in spherical, tubular, or ellipsoidal formations<\/li>\n<li>\n\t\tGraphite &#8211; The carbon atoms are bonded together in sheets of a hexagonal lattice<\/li>\n<li>\n\t\t<span>Graphene<\/span> &#8211; A flat two-dimensional sheet of carbon atoms<\/li>\n<\/ul>\n<p>\n\t<strong>Graphite<\/strong><\/p>\n<p>\n\tGraphite has long been used in the aviation, automotive, sports, steel and plastic industries, as well as in the manufacture of bearings and lubricants. Graphite is an excellent conductor of heat and electricity, is corrosion and heat resistant and is also strong and light.<\/p>\n<p>\n\tCurrently, the automotive and steel industries are the largest consumers of graphite and demand across both industries is rising at five percent per annum.<\/p>\n<p>\n\tThe steel industry uses graphite as liners for ladles and crucibles, they use it in the bricks which line blast furnaces and to increase the carbon content of steel. Graphite has already replaced asbestos in automotive brake linings and pads and is used for gaskets and clutch materials. Sparks plugs are also made incorporating graphite.<\/p>\n<p>\n\tBut demand for graphite has been rising for other applications as well; Flexible graphite sheets, lithium-ion and vanadium batteries, fuel cells, semi conductors, nuclear, wind and solar power.<\/p>\n<p>\n\t<strong><span>Graphoil<\/span><\/strong><\/p>\n<p>\n\t<span>Graphoil<\/span> is flexible graphite sheets and one of the fastest growing graphite markets. Flexible graphite is desirable for compression packing and gaskets, whose ability to seal comes from filling gaps through which fluid might flow.<\/p>\n<p>\n\tFlexible graphite products have valuable properties:<\/p>\n<ul>\n<li>\n\t\tFree from creep under constant load<\/li>\n<li>\n\t\tStable from cryogenic temperatures far below zero to temperatures well above the melting point of most ferrous and non-ferrous metals<\/li>\n<li>\n\t\tResists a wide range of corrosive materials<\/li>\n<li>\n\t\tNuclear radiation resistant even when exposed to massive doses of radiation<\/li>\n<li>\n\t\tFire-safe in the presence of highly volatile fluids and extremely high temperatures<\/li>\n<\/ul>\n<p>\n\t<strong>Nuclear Power<\/strong><\/p>\n<p>\n\tGraphite plays a key role in many current, and future, nuclear reactor designs. The next generation nuclear reactor (the <span>INL-led<\/span> Next Generation Nuclear Plant (<span>NGNP<\/span>) and other proposed high temperature, gas-cooled reactors) temperatures are expected to reach as high as 1,000 &deg;C in their cores &ndash; graphite, having a higher melting point then steel, doesn&#039;t burn until 3,000 degrees Celsius. Because graphite has a huge heat-absorbing capacity it&rsquo;s also used to keep nuclear fuel at safe temperatures during unexpected events &#8211; as an aside graphite is also used as a heat sink in computers.<\/p>\n<p>\n\tChina&rsquo;s Pebble bed reactors (<span>PBR<\/span>) are a graphite moderated, gas cooled nuclear reactor. The base of the <span>PBR&#039;s<\/span> design is the spherical (billiard ball-sized) fuel elements called pebbles. In the <span>PBR<\/span>, thousands of pebbles are amassed to create a reactor core. The pebbles are made of <span>pyrolytic<\/span> graphite (a protective graphite coating which moderates the pace of nuclear reactions) and they contain thousands of micro fuel particles called <span>TRISO<\/span> particles. These <span>TRISO<\/span> fuel particles consist of a fissile material such as <span>235U<\/span>. These reactors are cooled by non-explosive helium gas instead of depending on a steady source of water.<\/p>\n<p>\n\tSubstantial amounts of graphite are required to charge the reactor at startup &ndash; 3000 tons and a percentage of the balls must be replaced each year as the fuel is spent necessitating a further 600 to 1000 tons of graphite each year of operation. China has one operating prototype, is now building two commercial units and plans to have 30 Pebble Bed nuclear reactors in operation by 2020.<\/p>\n<p>\n\t<strong>Fuel Cells<\/strong><\/p>\n<p>\n\tThe two major types of fuel cells &#8211; the phosphoric acid fuel cell (<span>PAFC<\/span>) and the proton electrolyte membrane fuel cell (<span>PEMFC<\/span>) &#8211; currently under development rely heavily on <span>graphitized<\/span> carbon. <span>PAFCs<\/span> are for stationary power generation (primary or backup power for remote locations such as cell phone towers), whereas <span>PEMFC&#039;s<\/span> have attracted widespread interest for use in transportation applications.<\/p>\n<p>\n\tA fuel cell is not a battery &#8211; a battery is an energy storage device, it will stop producing electrical energy when the chemical reactants are consumed or it needs to be recharged. The fuel cell is an energy conversion device and will produce electrical energy as long as the fuel, and the oxidant, are fed to the electrodes.<\/p>\n<p>\n\tMore and more fuel-cell applications are in development every year and fuel cell technologies rely heavily on graphite &#8211; the proton exchange fuel cell (<span>PEMFC<\/span>) requires 80-100 pounds of graphite per vehicle.<\/p>\n<p>\n\t<em>&quot;Large-scale fuel cell applications are being developed that could consume as much graphite as all other uses combined.&quot;<\/em> U.S. Geological Survey<\/p>\n<p>\n\t<strong>Solar Thermal Collectors<\/strong><\/p>\n<p>\n\tThe biggest limitation of Solar or Photovoltaic (PV) panels is that they can use only a fraction of the sunlight that hits them, the rest of the sunlight turns into heat which actually hurts the performance of the panels.<\/p>\n<p>\n\tAn alternative that can make use of all of the sunlight, including light frequencies <span>PVs<\/span> can&#039;t use, is the solar thermal collector &ndash; they collect heat that&rsquo;s used to boil the water to make the steam which drives the turbine which creates the electricity.<\/p>\n<p>\n\tTo further increase the efficiency of solar collectors, <span>nanoparticles<\/span> &#8211; particles a billionth of a meter in size &#8211; are added into the heat transfer oils normally used in solar thermal power plants. In laboratory tests <span>nanoparticles<\/span> increased heat collection efficiency by up to 10 percent. 100 grams of <span>nanoparticles<\/span> provides the same heat-collecting surface area as an entire football field.<\/p>\n<p>\n\tGraphite <span>nanoparticles<\/span> are very efficient heat collectors.<\/p>\n<p>\n\t<strong>Vanadium <span>Redox<\/span> Batteries<\/strong><\/p>\n<p>\n\tWhen the sun doesn&rsquo;t shine and the wind doesn&rsquo;t blow neither solar or wind plants are generating electricity, these two green energies need batteries to store the excess energy they can produce under optimal conditions. The vanadium <span>redox<\/span> battery (<span>VRB<\/span>) could be the perfect answer as they:<\/p>\n<ul>\n<li>\n\t\tHave unlimited capacity simply by increasing the size of their storage tanks<\/li>\n<li>\n\t\tCan be left completely discharged for long periods of time with no ill effects<\/li>\n<li>\n\t\tHave low maintenance requirements<\/li>\n<li>\n\t\tCan be recharged by simply replacing the electrolyte<\/li>\n<li>\n\t\tHave a nominal environmental footprint<\/li>\n<\/ul>\n<p>\n\t<span>VRB&rsquo;s<\/span> also require almost 300 <span>tonnes<\/span> of flake graphite per 1,000 megawatts of storage capacity.<\/p>\n<p>\n\t<strong>Lithium-ion Batteries<\/strong><\/p>\n<p>\n\tThe most important application for increased graphite demand might come from the lithium-ion batteries found in electric vehicle batteries and used to power our modern consumer electronics.<\/p>\n<p>\n\tWhile lithium is the cathode the anode is graphite and these batteries need 10 to 30 (depending on which expert you are listening to) times more graphite than lithium and the lithium-ion battery industry is growing at a 30 to 40% annual rate.<\/p>\n<p>\n\tAs many as six million <a href=\"http:\/\/aheadoftheherd.com\/Newsletter\/2012\/Obamas-Clean-Energy-Agenda-on-Track.html\">electric vehicles<\/a> might be manufactured in 2020, each of them requiring 40 pounds of graphite for its battery system &ndash; the electric motorcycle and scooter markets are growing even faster.<\/p>\n<p>\n\tLithium-ion batteries are also crucial to the consumer electronics industry &ndash; power tools, cell telephones, laptops, tablets and media players etc.<\/p>\n<p>\n\t<strong><span>Graphene<\/span><\/strong><\/p>\n<p>\n\t<img decoding=\"async\" alt=\"\" src=\"http:\/\/www.fnarena.com\/ckfinder\/userfiles\/images\/aheadofherd15-2a.jpg\" style=\"width: 300px;height: 256px\" \/><\/p>\n<p>\n\tIf you took a close look, a very close look, at a graphite pencil lead you will see layer upon layer of carbon atoms, multiple two dimensional planes that are loosely bonded to their neighbors.<\/p>\n<p>\n\tThe reason graphite works so well as a writing material, and industrial lubricant, is because the layers of atoms slip easily over one another &#8211; the layered structure facilitates easy cleavage along the planes.<\/p>\n<p>\n\t<img decoding=\"async\" alt=\"\" src=\"http:\/\/www.fnarena.com\/ckfinder\/userfiles\/images\/aheadofherd15-2b.jpg\" style=\"width: 300px;height: 250px\" \/><\/p>\n<p>\n\tEach of those single layer of atoms is grapheme.<\/p>\n<p>\n\tSeparating the individual layers of graphite sets the electrons free and allows carbon to behave differently.<\/p>\n<p>\n\t<strong>Properties<\/strong><\/p>\n<p>\n\t<span>Graphene<\/span> has unique combinations of optical, electrical and mechanical properties:<\/p>\n<ul>\n<li>\n\t\tAstonishing electrical conductivity &#8211; <span>Graphene<\/span> has the highest current density (a million times that of copper) at room temperature; the highest intrinsic mobility (100 times more than in silicon); and can carry more electricity more efficient, faster and with more precision than any other material<\/li>\n<li>\n\t\t<span>Graphene<\/span> also beats diamond in thermal conductivity &#8211; it&#039;s better than any other known material<\/li>\n<li>\n\t\tIt is the thinnest and strongest material known to man; 200 times stronger than steel, is almost invisible and weightless, stretches like rubber &#8211; <span>graphene<\/span> can stretch up to 20 percent of its length &#8211; and yet is the stiffest known material, even stiffer than diamond<\/li>\n<li>\n\t\t<span>Graphene<\/span> is the most impermeable material ever discovered<\/li>\n<\/ul>\n<p>\n\t<strong>Uses<\/strong><\/p>\n<p>\n\t<em>Touch Screens<\/em><\/p>\n<p>\n\t<span>Graphene<\/span> is transparent in infra-red and visible light, absorbing just 2.3 percent of light that lands on it. But, with your naked eye, you can see a single layer of <span>graphene<\/span> laid on a blank piece of white paper.<\/p>\n<p>\n\tIndium Tin Oxide (ITO), the current touch screen material of choice, absorbs 10 percent of incident light, but it&rsquo;s quite brittle, the exact opposite of graphene. Graphene is ideal for use in touch screens.<\/p>\n<p>\n\tAccording to some reports the world has only 5-10 years of ITO reserves remaining and prices already exceed US$700,000 per tonne.<\/p>\n<p>\n\t<em>Photovoltaic (PV) Cells<\/em><\/p>\n<p>\n\tGraphene has no band gap &#8211; everything is accepted.<\/p>\n<p>\n\tWhat this means is that graphene solar panels have a huge advantage over silicon solar panels &#8211; graphene can absorb light from all over the solar spectrum, whereas silicon is confined to just certain frequencies.<\/p>\n<p>\n\tThat makes graphene solar panels much more efficient than any other material &#8211; instead of waiting 10 12 years for payback it might come as quickly as 5 years.<\/p>\n<p>\n\t<em>Transistors<\/em><\/p>\n<p>\n\tIt is possible to induce a small band gap in graphene by doping it, which means grapheme can be used a transistor &#8211; you need the band gap if you want to be able to turn the transistor off.<\/p>\n<p>\n\t<em>Spintronics<\/em><\/p>\n<p>\n\tSpintronics is a technology for controlling not only individual electronics, but also their spin, this increases the amount of information that can be stored per electron &#8211; data is stored in the spin of an electron, not its presence. Since graphene has a long spin diffusion length the technology promises to increase the efficiency with which devices consume power and increase data storage capability.<\/p>\n<p>\n\t<em>Superconductivity At Room Temperature<\/em><\/p>\n<p>\n\tThe mean free path is the distance an electron can travel freely without bumping into something, or having its path disrupted by scattering &ndash; both cause resistance which means heat is generated.<\/p>\n<p>\n\tIn graphene, the mean free path is 65 microns &mdash; long enough that electronic components could be made that would operate at ambient temperatures with virtually no resistance.<\/p>\n<p>\n\tWe&rsquo;re talking ambient temperature unimpeded conduction of electrons &#8211; superconductivity at room temperature.<\/p>\n<p>\n\t<em>Sensors<\/em><\/p>\n<p>\n\tGraphene is the most impermeable material ever discovered, not even helium atoms can squeeze through. Highly sensitive gas detectors can be manufactured because the smallest quantity of a gas will get caught in its lattice producing an electrical signal that flags the presence of the chemical.<\/p>\n<p>\n\tMedical imaging devices that won&rsquo;t do the harm X-rays cause are possible, as are strain sensors &ndash; when you pull or push the strain can be monitored &ndash; this could be useful for buildings in earthquake prone areas or in airplane wings.<\/p>\n<p>\n\t<em>DNA sequencing<\/em><\/p>\n<p>\n\tIf you pass a strand of DNA through a sheet of grapheme with a small gap in it the electrical properties of graphene change on exposure to each base pair. Because graphene is 2D, it can &quot;read&quot; one base at a time, making it much more accurate than anything used today.<\/p>\n<p>\n\t<em>Derivatives<\/em><\/p>\n<p>\n\tAll the chemical derivatives of graphene are useful. You can dissolve graphene and the solutions (fluorographene, graphene oxide, hydrogenated grapheme) have applications in printable electronics that are already ten times better than current state of the art technology.<\/p>\n<p>\n\t<strong>Criticality<\/strong><\/p>\n<p>\n\tIn 2010 a European Commission included graphite among the 14 materials it considered high in both economic importance and supply risk. The British Geological Survey listed graphite as one of the materials to most likely be in short supply globally.<\/p>\n<p>\n\tThe US has also declared graphite a critical material. The U.S. Department of Homeland Security, and the State Department, said America could be hurt if terrorists were to disable graphite mines in China.<\/p>\n<p>\n\tMarket<\/p>\n<p>\n\tThe natural graphite market is 1-1.2 million tons per year and consists of several different forms of graphite &ndash; flake, amorphous and lump. Historical applications primarily use amorphous and lump graphite, most newly emerging technologies and applications use flake graphite. Of the up to 1.2 million tons of graphite that are processed each year just 40% is flake.<\/p>\n<p>\n\tChina, India and Canada are responsible for most graphite mining and processing with China producing the lion&rsquo;s share at 70&ndash;80%. China&rsquo;s production is 70% amorphous and lower value small flake graphite.<\/p>\n<p>\n\tCurrently China imports a significant amount of North Korea&rsquo;s large flake graphite production raising considerable doubts in regards to China&rsquo;s abilities to ramp up its graphite supply. Indeed China has already taken steps to retain its graphite resources by restricting its export quota &#8211; China imposed a 20% export duty, a 17% VAT and also closed state owned enterprises.<\/p>\n<p>\n\t<em>&ldquo;The days of cheap, abundant graphite from China are over.&rdquo;<\/em> Industrial Minerals Magazine May, 2011<\/p>\n<p>\n\tIt&rsquo;s thought that the increased use of lithium-ion batteries could gobble up well over 1.6 Mt of flake graphite per year by 2020 &#8211; only flake, upgraded to 99.9% purity and synthetic graphite (made from petroleum coke, a very expensive process) can be used in lithium-ion batteries.<\/p>\n<p>\n\t<em>&ldquo;Annual flake graphite production will have to increase by a factor of six by 2020 to meet incremental lithium carbonate requirements for batteries.&rdquo; <\/em>Canaccord research report<\/p>\n<p>\n\tThe U.S. Geological Survey says large-scale fuel cell applications are being developed that could consume as much graphite as all other uses combined &ndash; a bold statement, but even if only half of the USGS demand is realized graphite use is going to explode just because of fuel cells, let alone other known demand drivers and new applications.<\/p>\n<p>\n\tWhat if the current market almost doubles &ndash; new demand, between now and 2020, comes in at one million tonnes on top of the existing 1.2 million?<\/p>\n<p>\n\tToday&rsquo;s graphite producers, other than the ones in China, are going to have to produce more and junior companies are going to have to get busy and start to develop deposits. There will be a premium placed on mines in stable, safe areas for investment.<\/p>\n<p>\n\tSince a large scale producer puts out 20,000 to 40,000 tons per year that&rsquo;s a lot of new mines and a lot of opportunity for investors &ndash; one million tonnes divided by 40,000 could be the equivalent of up to twenty five mines worth of new production needed &ndash; and that&rsquo;s a severe low-balling of the experts forecast increased usage numbers.<\/p>\n<p>\n\tConsider also that most of the mines expected to come online, and the ones already in production, will not produce the highest grades of graphite &#8211; crystalline large flake &ndash; which runs between 94% and 97% carbon and starts at 80 or higher mesh size. Indeed most will produce medium, small-flake, lump and amorphous graphite.<\/p>\n<p>\n\t<strong>Conclusion<\/strong><\/p>\n<p>\n\tThe extraction of graphite and its processing is very well known in the west and western countries are the leaders in graphite and graphene application research.<\/p>\n<p>\n\tChina is not going to be much of a factor in the large flake graphite market, except perhaps as a future importer &#8211; the west has large flake graphite deposits, knows how to extract and refine the graphite and are the leaders in technological advancements regarding this space and demand is going to grow exponentially.<\/p>\n<p>\n\tNew, high-tech applications require more and more graphite production while graphene seems to be a wonder material and a lot of time, effort and money is being spent researching it &ndash; 3000 research reports were written just in 2010.<\/p>\n<p>\n\tAn investor needs to be doing his\/her due diligence on junior resource companies with near surface, high grade large flake deposits close to all necessary infrastructure in politically safe jurisdictions.<\/p>\n<p>\n\tGraphite should be on every investors radar screen. Is it on yours?<\/p>\n<p>\n\tIf not, maybe it should be.<\/p>\n<p>\n\tRichard (Rick) Mills<br \/>\n\trick@aheadoftheherd.com<br \/>\n\twww.aheadoftheherd.com<\/p>\n<p>\t<em>Disclaimer: The views expressed are the author&#039;s, not FNArena&#039;s (see our disclaimer)<\/p>\n<p>\tFind out why FNArena subscribers like the service so much: &quot;<a href=\"http:\/\/www.fnarena.com\/index4.cfm?type=dsp_newsitem&amp;n=29EB960D-9DFF-C00E-7F6B464E5D52E250\">Your Feedback (Thank You)<\/a>&quot; &#8211; Warning this story contains unashamedly positive feedback on the service provided.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Ahed of the Herd&#8217;s Rick Mills suggests graphite should be on the radar screen of all investors.<\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[23],"acf":[],"_links":{"self":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/59525"}],"collection":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/comments?post=59525"}],"version-history":[{"count":0,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/59525\/revisions"}],"wp:attachment":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/media?parent=59525"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/categories?post=59525"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/tags?post=59525"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}