First Canadian Graphite’s flagship asset is the Lac Guéret South graphite project in the Côte-Nord region of northern Quebec, about 230 km north-northwest of Baie-Comeau, next door to Nouveau Monde Graphite’s Uatnan project. We talked about the new Zone 13 target, the planned fall drill program, the treasury and upcoming financing needs, metallurgy, First Nations engagement, and his stated plan to take the project straight to production as a concentrate seller rather than positioning it for a takeover or going vertically integrated into battery materials.
TL;DR
Currently, the main story is Zone 13, a roughly 4 km by 600 m EM anomaly that has never been drilled, where crews found visible graphite at surface and have traced a conductor over 3.1 km of strike. CEO LaGourgue told me they plan a 20,000 metre drill program starting around November at a cost of about $4 million, aiming for a resource update in early 2027 with a target of at least 30 million tonnes and ideally 50 million tonnes, versus the current small 2019 resource of 1.76 million tonnes indicated at 17% graphitic carbon plus about 1.5 million tonnes inferred at 16.4% on Zone 1. They have roughly $3.4 million in the bank, which means a raise is likely needed before the drill program. Metallurgy results from Corem are expected around August, a PEA is now an early 2028 event, and he says he’d like to be in production within four years.
What have they done for shareholders lately?
Since LaGourgue came in as CEO earlier this year, the company flew a new airborne EM survey over ground that was last flown in 2003 by SOQUEM with much older technology, which generated the Zone 13 target. Field crews using beep mats then found visible high-grade graphite at surface on Zone 13 on day one and have since traced the conductor to 3.1 km of strike, which the company announced on July 7 as a discovery, though I pushed back on that word since nothing has been drilled. Samples are heading to the lab and bulk samples are going to Corem for metallurgical and flotation testing. They also expanded the claim package, rebranded as FC Graphite, brought in a new independent board including former federal minister Christian Paradis and Mike Iverson, who sold Niogold to Osisko, and started formal engagement with the Pessamit Innu, including a letter of intent and field participation through the community’s exploration arm. Antoine Fournier is also rewriting the technical report, with the 2019 resource being moved to historical status.
How much money do they have and what are they spending it on?
He told me they have about C$3.4 million in the bank with corporate burn around C$50,000 a month. The current two-week field program cost about C$100,000, and he expects to spend roughly C$400,000 total on field studies before drilling, leaving about C$2.7 million heading into the planned 20,000 metre, roughly C$4 million drill program, so they will need to raise before then, especially since he doesn’t want the treasury below a C$2 million cushion. The company raised C$2.8 million at 30 cents in February with a half warrant at 50 cents for two years, plus C$1 million of flow-through at 50 cents with no warrants, following an earlier C$700,000 raise at 15 cents with a 20-cent warrant. There are 27.2 million warrants and 1.8 million options outstanding against roughly 45.5 million shares out, so options and warrants make up about 40% of the 74.5 million fully diluted count, and he expects 10-cent warrant exercises to help fund things. Quebec refunds 45% of critical minerals exploration spending, which stretches the budget. On alignment, LaGourgue owns about a million shares bought at an average around 30 cents, 1.4 million warrants at 10 cents transferred from the previous group, and about 800,000 options at 30 and 50 cents. There is no royalty on the project, and he has no employment contract yet, so no change-of-control terms exist at this point.
Upcoming catalysts
Technical: assay results from the current surface sampling in the coming weeks, a summary map and geophysical data release after crews finish on July 12, metallurgy and flake size results from Corem expected around the first or second week of August, channel sampling and trenching in the fall once ATI permits are in hand, a roughly 20,000 metre drill program at Zone 13 planned for around November, and a resource estimate targeted for early 2027, with a PEA pencilled in for early 2028. Operational: field crews back out in early August, and potential offtake or strategic conversations once metallurgy is in hand, with automakers already calling. Corporate: a likely financing before the fall drill program, a possible memorandum of understanding with the Pessamit Innu within a few months after their late-August elections, management contracts with KPIs to be set by the new board, and conference appearances including Planet MicroCap events.
Risks
The main risk is that this is an undrilled target, and everything from the resource growth story to the production timeline depends on Zone 13 delivering when drilling starts, which he acknowledged, though he pointed to Zones 3, 4, and 6 as backups. He also mentioned that Zone 13 appears to trend off their claims a bit, which he is trying to mitigate. Financing risk is real since they will need to raise roughly C$4 million worth of drilling money before fall, likely through flow-through, and dilution is already a factor with 40% of the fully diluted count in options and warrants. Metallurgy is unproven under current management, with historical 2018 test work showing only 46 to 54% mass yield and up to 31% graphite loss to fines, so the Corem results in August matter a lot. Beyond that, the First Nations agreement is still at the letter stage, permitting timelines are outside their control despite Quebec’s fast-track talk, and the company’s history of four rollbacks in ten years is a reminder of how this can go when exploration doesn’t cooperate.
First Canadian Graphite CEO Interview
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