The graphite mineralization found at the Property is best categorized as a disseminated flake graphite deposit according to Simandl and Kenan (1997), who referenced the Property in their paper entitled, “Crystalline Flake Graphite”. These deposits are commonly hosted by porphyroblastic and granoblastic marbles, paragneisses and quartzites in upper amphibolite or granulite grade metamorphic terrains.

Graphite mineralization on the Property is almost ubiquitous, occurring locally in all rock types except for the intrusions. Calc silicate gneisses are the preferred host for the most consistently higher-grade mineralization. The calc-silicate gneisses have been split into two groups (Augsten 2001), Cs1 and Cs2, on the basis of mineralogy (presence or absence of spinel), texture, colour and the concentration of graphite. Cs2 typically contains 2 to 5% flake graphite, or organic carbon, referred to as fixed carbon (FC). Graphite also occurs as discrete disseminated grains most typically from 0.5 mm to 1 mm in diameter. These crystals have developed with a preferred orientation parallel to sub-parallel to foliation. Cs1 typically contained 2 to 3% graphite. While pyrite is fairly common throughout the section, very fine grained disseminated pyrite ± pyrrhotite is common in the graphitic calc-silicate host rock.

A regolith has formed in-situ above both Cs units locally, and there also exists a transition zone of slightly weathered Cs material, which is less friable than the regolithic zone. Of the two calc–silicate units, the weathering is typically more pronounced over the Cs2 unit, and while both of these materials are graphitic bearing, the in situ weathered Cs2 material is of primary importance. As this material is sited immediately above the areas proposed for hard rock quarrying, it makes a desirable initial target due to the ease of extraction, higher grade, and the ease of beneficiation.

As mentioned above the regolithic and transition zones are by and large the best targets on the Property, as overall FC concentrations are often from 3 to 5% FC in the Cs2, and 2 to 3% FC in the Cs1 derived material. Graphite may reach concentrations of 1 to 2% FC in glacio-fluvial till locally, although there are areas where numerous blocks of Cs material comprise boulders or cobbles within the till, and graphite concentrations can be in the 2 to 3% FC range.

The graphite mineralization on the Property is particularly amenable to extraction by quarry methods as it is lying sub-parallel to slope of the hillside in the Mine Lease area and offers the benefits of a low stripping ratio.

The mining methods as laid out in the 2002 Mine Plan involved a Quarry to be a small seasonally run operation.

Weathered graphitic calc-silicate material would be extracted and transported to the Plant facility. Quarrying would utilize open pit extraction methods.

At present, under Eagle Graphite’s recently submitted Mine Plan, mining would continue to be carried out by open pit methods. The regolith material would be excavated, screened and crushed and transported to the storage transfer station at the base of the mountain. From the station, the material would be transported to the Plant facilities for processing.

The Crystal Graphite project hosts two distinct types of graphitic material: severely weathered surface regolith, which is currently being processed through a 30 tph capacity pilot plant, and hard rock graphitic material, which lies beneath the surface and comprises the majority of the deposit. To date, most of the testwork has been conducted on various composite samples of the regolith.

The stockpiled feed material is generally 0.5" passing screened fines from the oxide quarry, and is fed into the feed hopper by a front-end loader. The hopper capacity is 15 to 20 minutes at a 25 to 30 tph feed rate. The material discharges to a variable speed feed conveyor, from where it is metered into a pulping box and mixed with recycled tailings pond water and pine oil flotation reagent. (Fuel oil can also be added.) The conveyor is not equipped with a weigh scale, so the plant feed rate is determined by taking a manual cut of sample from a predetermined length of the feed belt. The wei ........