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“The Next Big Thing … Be Among the First”

"Not yet public" Swedish Graphite pick teased by Michael Robinson

By Travis Johnson, Stock Gumshoe, February 14, 2012

The folks at the Money Map Press are pitching one of those “kitchen sink” deals where you pay up front to get all of their newsletters for life — these are usually in the neighborhood of $3,000-5,000 with an “annual maintenance fee” that’s generally around a hundred bucks, and this one is right in line with that (and yes, as many publishers do they give it a twist by saying they’ll “send you a check” — for $2,500 in this case, which is pretty much like a car salesman giving you a “cash back” offer, saying “discount” just doesn’t hit your lust receptors in the same way).

The deal, which they call the “Passport Club,” includes more newsletters and trading services than you’d have time to read, from all the heavily teased editors they promote to our mailboxes every day (Dr. Kent Moors, Shah Gilani, Peter Krauth, etc.), but the big teaser pitch behind the promotion is from another guy, Michael Robinson, who used to work for sister publisher Wealth Daily/Taipan, but whose American Wealth Underground appears to have disappeared.

Let’s pause to have some sympathy for our friendly neighborhood Stock Gumshoe, who gamely tries to keep track of all these letters — many of them don’t stick around long enough to even get one year of renewals under their belts.

But back to the point of today’s sleuthification exercise, yes?

The pitch is that Michael Robinson has identified a pick that’s so darn selective and juicy that we can’t even buy it yet … but apparently we’ll be able to do so soon, and it’s apparently a whiz-bang excitement maker.

Here’s how they tease this “not yet available” investment idea:

“Recently the firm closed out a private placement surrounding this deal worth about $5 million. To have gotten in on that round, you’d have to be pretty wealthyโ€ฆ know the partnersโ€ฆ or have some pretty high-up contacts in the industry.

“Of course, we all know the ‘burning match’ analogy as it applies to deals like this, where the earliest people in typically see the greatest benefitsโ€ฆ and as the match is passed down the line to other investors, it gets shorter and shorter until the flame goes out or somebody gets burned.

“Fair or not, that’s just the way these deals work. Founding partners, friends, relatives, wealthy clients of the banks handling the deal โ€“ they tend to get in under the best terms.

“While we can’t be the ones who ‘strike the match,’ we could be the second to hold it โ€“ by being among the very first to own shares from a small initial offering set to be released as early as March, at a very advantageous ‘first issue” price.'”

OK, so it’s some kind of junior IPO — they tease that it’s likely to be offered at about 50 cents (and imply that perhaps you could buy 5,000 shares with that “$2,500 check” they’re going to send you).

And the company? It’s somehow related to graphite — here’s the pitch:

The ‘Next Big Thing’

“There’s a lot of talk about what will be the ‘green energy’ technology that will save us from dependence on Middle Eastern oil and further destruction of the environment.

“Whether it’s wind power, solar, fuel cells, nuclear โ€“ one thing is for sureโ€ฆ batteries will be needed to store the excess power these and other sources generate.

“Battery technology has already come a long way with the development of lithium-ion batteries, which allow laptops, cell phones, smart phones, iPads, iPods and other “portable” technologies to hold charges longer while using up less space. But the greatest demand for lithium batteries โ€“ and the unique specialty metals required to make them โ€“ will come as more and more electric cars and motorbikes make their way on to streets around the world โ€“ something that’s already happening in Europe and Asia, where people aren’t so attached to gas-guzzling SUVs.

“The ‘electric’ mineral our company will be mining is a key component of the modern lithium-ion batteries.

“But it’s not lithiumโ€ฆ It’s graphite. Specifically, large-flake graphite, of which there is up to 10 to 15 times the amount in the average lithium-ion battery than lithium itself.”

So at least it’s a teaser that focuses on graphite as a key supply item for advanced batteries, not as the raw material for graphene — we’ve seen the graphene teasers a few times, and the stuff is awesome, but the actual quantity of graphite used to make graphene nanomaterials is teensy (flake graphite, after all, is priced by the ton, and we’re talking about materials that are the thickness of a single atom).

But yes, there are high-volume demands for graphite, too, and batteries are a big deal, helping to drive the price up several hundred percent in the last decade. So which graphite supplier is Robinson trying to tell us about?

Well, they’ll apparently have a conference call with the company in a few weeks to reveal more, but this is what they tell us now about this company and their mine:

“Our contact… and a consortium of geologists and rare-earth business professionals recently snapped up an idle mine in Sweden that they believe just happens to have an estimated 30-year supply of graphite sitting in the ground.

“Better still, the mine is fully functional, with production facilities on siteโ€ฆ roads and other infrastructure elements in place. There’s even a stockpile of medium- and large-flake graphite ready to be shipped!

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“… back in 1993, the previous owners of the mine spent as much as $70 million on the project โ€“ a reasonable baseline for what it takes to get a mine like this up and running….

“Problem was, they were about a decade too early.

“It wasn’t until about 2006 โ€“ when electric cars and power-hungry hand-held computing products really started to take hold โ€“ that the demand for large-flake graphite started to soar.

“Unable to sustain a profit with graphite trading at a paltry $480 per metric ton, the mine closed in 2001. And it’s been sitting idle ever since.

“Today’s a different story.

“With graphite trading at $1,500 for the regular-grade stuff โ€“ and upwards of $2,500 for large-flake โ€“ they saw an opportunity. When they learned that the property was still available, they went to check it out.

“What they found was a ‘working’ mine 150 feet deep, with enough graphite stores to be productive a full 30 years, and supply Europe with an estimated 8% of its current annual demand.”

And a few more details about this potential IPO:

“… further tests revealed the mine could have graphite deposits as far down as 1,500 feet โ€“ which means there could be substantially more graphite than they originally expected the mine to produce.

“So they put in a bidโ€ฆ won the rights to itโ€ฆ got the money together through the $5 million private placement I told you aboutโ€ฆ and bought the property.

“And now they’re about to go publicโ€ฆ with a very small initial stock offering of roughly 35 million shares at 50 cents each. Which brings us to the opportunity at hand.”

And apparently these investors have some sort of nordic connection, because they were involved in a rare earths play in Scandinavia as well:

“This whole situation is unfolding almost identically to another ‘rare earth’ company our contact and his group started back in 2009.

“He found a very productive property, this one also in Scandinavia.

“He put a top-notch team together.

“They raised some startup capital. Then he issued some stock through the same exchange via a very small offering, priced at 60 cents a share…

“Within 24 months, that very stock had climbed to $5.73 a share โ€“ an 855% gain!”

Well, I’ll wager that the other scandinavian rare earths pick they’re referring to is Tasman Metals, which I covered when Michael Robinson teased them last fall for his former employer. Of course, he was teasing that not when it ran from 60 cents to $5.73 (which was an all-time intraday high back in the rare earth go-go days in early 2011), but last Fall in the $2.50 range, which is where it still is today.

And today’s graphite pick? This goes into the Thinkolator … and our answer comes out the other end, just as easy as lutfisk … this is going to be Flinders Resources.

The graphite mine and processing plant is called Kringel Graphite, it is in Sweden, and it’s owned by Burke Resources, a private company. They agreed to merge with a Canada-listed (venture exchange) “blank check” company called Tasex Capital last year, which is roughly a $5 million deal, and they will be raising money this year to fund the restart of the Kringel project.

They think they should be able to produce some graphite from the stockpile during 2012, and that they can ramp up to full capacity production while they’re also drilling to expand the resource over the next three years.

With a name like Flinders you probably know there’s an Australian connection, and yes, this is basically an Aussie company despite the Swedish mine and the Canadian listing — the list of proposed directors includes basically everyone from Tasman Metals. The presentation they made available about the qualifying transaction and the basic potential of the Kringel mine is here, the preliminary company fact sheet is here, and the announcement of that “qualifying transaction” with Tasex is here.

And no, as far as I can tell you can’t yet trade this emerging company — Tasex has been in a trading halt since the qualifying transaction was announced, and I assume that the Money Map folks have got good information when they say that the initial offering and additional fundraising will take place sometime over the next month or so. Haven’t seen any news on that front myself. So if you’re interested, you can keep your eyes peeled or get in touch with the company (their contact info is on their very bare-bones website here).

So that’s all I know about Flinders — looks like it is real, it is becoming funded, it is buying that mine in Sweden, and apparently the bull market in graphite is here to stay if the teaser-meisters are on the ball, since several of them are talking it up to no end. Whether or not that means they will manage to IPO soon, and whether buying that IPO right away will be a good choice, well, I have no earthly idea. If you’ve got a graphite opinion, or a Flinders opinion, or, heck, even a Money Map or Michael Robinson opinion, let it loose with a comment below.

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John
Member
February 14, 2012 1:17 pm

Byron King of Agora is pitching graphite as well. Wonder if this is the same company?

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Gary
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Gary
February 14, 2012 2:04 pm
Reply to  John

The company that Agora is pitching is Graphtech International, Ltd., Ticker Symbol “GTI”.

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Maxy
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Maxy
February 14, 2012 1:56 pm

NGC.V….just on Canadian investment tv channel BNN (Business News network) citing graphite mining ops and planned mine in Canadian province of Ontario under dev.

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GeorgeW
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GeorgeW
February 14, 2012 2:11 pm

I think the one from Agora is Northern Graphite (NGPHF)!

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Dave Wallace
Dave Wallace
February 14, 2012 4:04 pm

I wassearching this morning and I went to Google to look for an Ontario, Canada and it gives it company of Northern Graphite Corp. On the Canadian stock Market: NGC and in the US symbol it is:NGPHF.

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nocdavis
Member
nocdavis
February 14, 2012 4:42 pm

Looking at the fact sheet isn’t it FLNDF (Flinders Mines Ltd) closed at .33 today?

๐Ÿ‘ 21793
Tom t
Tom t
February 14, 2012 5:53 pm

I read somewhere that currently China has been the dominant graphite supplier, and that they are now nearly out of large flake. I’m not so sure large flake is important for batteries, and regular graphite is around $700/ton. So now there are 4 large flake deposits – with GTI being the only one already producing.

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blackjack
blackjack
February 14, 2012 8:12 pm

SER on the Australian ASX is also in a deal with Canadian Co MEGA
MEGA bought most of ULEY a large flake graphite deposit in Australia
ULEY was an operating mine and MEGA’s money is refurbishing the plant.
MEGA also plan an IPO in Canada this year and so share price should bounce
Established deposits, an operating mine, and IPO, customers already – what more could you want

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alex
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alex
February 14, 2012 8:45 pm

that is the one i am waiting for,how can i be informed of the ipo for mega in advance,what site do i kept a i on , thanks

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blackjack
blackjack
February 14, 2012 10:24 pm
Reply to  alex

if you want to keep up to date on whats happening you will need to go to http://www.hotcopper.com.au
there is a thread there and there are a few legal issues with the demerger and IPO that you can read about
if you are an SER holder you will get some MEGA shares and some royalties and also SER
will continue to hold some shares and also has agreements with a university that is working with graphene
hope this helps

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jimbo0421
Member
jimbo0421
February 15, 2012 7:29 am
Reply to  blackjack

Do any of the tickers you listed trade on the pink sheets?

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blackjack
blackjack
February 15, 2012 8:58 pm
Reply to  jimbo0421

doesnt look like it but a broker can buy for you

Riggbov
Guest
Riggbov
February 15, 2012 6:14 pm
Reply to  alex

Maybe creating a Google alert could be helpful as well.
Just give them a few keywords , MEGA IPO GRAPHITE and you will be contacted.
A fantastic tool.

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alainbm
alainbm
February 21, 2012 1:19 pm
Reply to  Riggbov

Thanks for the tip. I have used it to notify me of any news on some junior mining companies I am thinking about investing in and its already been very useful.

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Gary E. Shearer
February 15, 2012 12:37 pm

Demand is 600 times supply. Big banks are gorging on it – should you?

Anyone know what Elliot Gue is “Pitching”

Janus
Guest
Janus
February 17, 2012 3:43 pm

The companies recommended by Byron King (Agora) are:
Outstanding Investments: GTI
Energy & Scarcity: FMS (!)
NGC is (to my knowledge) not promoted by Agora…
Burke/Flinders/Tasex looks promising, but without more data
it’s a highly speculative gamble… especially so early in the game.
Happy hunting ๐Ÿ™‚

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Marc, Toth
Guest
February 19, 2012 10:56 am

well, for what its worth, i followed Michael Robinson’s American Wealth Underground…and found it to be quite well done( he made great calls on the REE in mid 2010- among other things) … such to the point that i’d be interested in whatever his next newsletter would be…

Marc, Toth
Guest
February 19, 2012 10:59 am

and a question – was there ever an idea about the Nick Hodge Pitch for that Massive Canadian mine that had enough Rare Earths for like the next Century and was just sitting on the ground in the middle of nowhere??? thanks ๐Ÿ˜›

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alainbm
alainbm
February 20, 2012 3:08 pm
Reply to  Marc, Toth

I think its DNI Metals

Gumshoe has covered here http://stockgumshoe.com/reviews/wealth-daily/is-this-the-goldmine-of-the-future/

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Stu
Member
Stu
February 20, 2012 11:13 am

I sent an email to Flinders for more info and all I got back was, the website will be up shortly. copy below.

Thank you for your interest in Flinders Resources.
In the next few weeks we will be updating the flinders resources website to include a place where you can register for automatic updates.
Regards, Martin McFarlane, M +61 467 749 759

Bonsap
Guest
Bonsap
February 23, 2012 12:31 pm

To Mark Toth re Nick Hodge’s Canadian mine with REE lying on the ground.
It is DNI. It is also being pitched heavily for a wide variety of other metals. The “heap” extraction process is based on chemical disolving of metal salts and processes that then precipitate out the various metals. The process will be “similar” to those used at Talivera (sp?) in Finland, but they must be distinct for each set of minerals, so much research remains to be done on them. My first trade made money on the stock. It recently hit $0.62 and currently has fallen back. I would reenter cautiously at about $0.49.

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aoibhneas
February 23, 2012 1:23 pm

Fwiw, I received notice that whatever the company is it will open on Monday with offering at 50 cents. MGP today is no change. TAS is up 7 1/2% today and NGPHF is currently up 10.86%. No news on any of it that I can find. Someone mentioned Graftech (GTI) but it down 15% today.

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kinnorth
Member
kinnorth
February 23, 2012 3:22 pm

I have a few companies including Northern Graphite and Focus Metals. Focus Metals is in the news today with some glorious announcement. It increasingly seems like a “Greater Fool” type of asset play as the promoters jump on the latest bandwagon. So, I sure can see this resource quickly reaching a short term oversupply situation. All the potential, which is huge, is far in the future. i.e. Have you bought a hybrid vehicle lately?

Right now there is little need for more resource but much more supply will come along soon as all these companies race to be the biggest and best.

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blackjack
blackjack
February 23, 2012 9:19 pm

well theres graphite and theres graphite – quality, mesh size, ease of mining all go towards a good stock
PLUS – the uses now and in the future are going to be staggering.
Graphite used for
huge storage capacitors for storing excess electricity generated from cola burning (already happening in China)
EV’s already happening in USA and China
Graphene – each day new uses found – stronger than steel, thin coating stops metals corroding up to 7 times other products, conductor, etc etc
etc etc
if you are worried about the boom and bust then put stops on your shares

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Mike Dee
Member
Mike Dee
February 24, 2012 6:58 am

Super work Michael
I think you got it on the money. Yeah it looks like Tasex will create a new company from the Kringel mine. We have to wait. But According to my Geiger subscription on Money Morning, I’d need to sign up some more with them to find out the name. But now i dont need to, just watch for new IPOs who match the criteria any day now – perhaps even today or Monday. Ill check back to see if you confirm too. Rock on! – pun intended ๐Ÿ™‚

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Bob T
Member
Bob T
February 24, 2012 11:27 am

I have had previous success with the rare earth and natural resources picks of Michael A. Robinson. I had subscribed to his publication and selected six of his many suggested stocks that made sense to me. I placed trailing stop losses on all, and when the market in rare earths tanked, I found that I had a profit of $35,000. That is why I have been tracking down this recommendation without buying in to the sales pitch for $$$$ membership.

alainbm
alainbm
February 24, 2012 12:10 pm
Reply to  Bob T

Everything that was rare earth related regardless of merit shot up in August 2010. It’s a tougher market now a days in regards to rare earths.

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GH
Irregular
February 24, 2012 10:41 pm

The new company is Flinders Resources Ltd. The TSX exchange listing will be FDR. It will initiate trading on Monday morning and the company has not applied for a Pink Sheet listing nor does it have any immediate plans to do so. This comes from having spoken with a young lady at the company, today, who identified herself as head of customer relations. Unfortunately there seems to be a 40 day waiting period before american brokerage houses can purchase shares for their customers on an IPO without connection to an american exchange. Having spoken with this young lady’s personally referred broker in Vancouver, he seems to be the same person that brought forward Tasex Capital, LTD previously. Apparently the only way to purchase this stock for the first 40 days after the IPO is through a Canadian broker. If anyone has any knowledge of how to circumvent this, please let it be known. I am all ears. I confirmed all of this information with directors at the international trading office of Schwab and, despite being one of their active options traders, could open no hidden doors. Any help would be appreciated, especially prior to the Monday morning opening. As Forrest Gump so eloquently said: “That’s all I have to say about that.” GH.

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PR
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