Graphex Mining
Graphex Mining's Chilalo graphite project in Tanzania

ASX-listed Graphex Mining has made significant progress on the updated feasibility study, EPC arrangements and offtake for the development of its Chilalo graphite project.

Tanzania – Recent meetings with the Suzhou Design and Research Institute for Non-Metallic Minerals have confirmed the flow sheet for the Chilalo processing plant. The meetings were attended by the company’s MD and representatives of BatteryLimits.

BatteryLimits has been reengaged to update the existing feasibility study to incorporate technical work previously completed by both BatteryLimits and Suzhou.

Graphex and Suzhou have agreed to an industrial trial that will involve processing a minimum of 5 t of Chilalo ore for detailed design and with a view to enabling the engineering, procurement and construction (EPC) contractor to provide performance guarantees for the targeted throughput and product specifications, including flake size, grade and recoveries.

The industrial trial will produce at least 500 kg of product, which will be provided as sample material to all the major players in the Chinese expandable graphite market.

Graphex Mining has also signed five statements of sales intent (SSIs) for the supply of flake graphite to expandable graphite producers and traders in China. The SSIs cover 80 000 tpa of Chilalo graphite and the company anticipates that further SSIs will be signed in the future, reflecting the strong demand for Chilalo graphite.

The company expects to convert the SSIs into binding offtake agreements in the near future.

Owing to a serious shortage of coarse flake graphite supply in China, existing expandable graphite manufacturers are experiencing critical issues with the availability of feed stock.

This tightness of supply of coarse flake graphite to expandable graphite manufacturers is highlighted by the fact that a significant portion of refractory brick manufacturers, who had traditionally used +80 to +100 mesh (150-300 microns) material, are now using -100 mesh (<150 microns) material because anything coarser than +100 mesh (150 microns) is being used for expandable graphite. ><150 microns) material because anything courser than +100 mesh (150 microns) is being used for expandable graphite.

Graphex understands that the parties to the SSIs represent a large portion of the existing expandable graphite market, which gives Graphex extensive coverage of that market. The counterparties also cover the main graphite production provinces of Heilongjiang and Shandong.

“We are pleased with the progress of the updated feasibility study and look forward to the proposed industrial trial, which will guide detailed design and allow for performance guarantees under an EPC contract. We remain confident that the updated feasibility study will produce industry-leading results,” says Graphex MD Phil Hoskins.

“Entering into these SSIs is a significant and material step forward for Graphex. We now look forward to converting the SSIs into binding offtake agreements in the near future. These relationships will ultimately see high quality Chilalo graphite placed into the expandable graphite market.

“With the use of flame retardant building materials receiving significant policy and regulatory support from governments around the world, Chilalo is expected to form a baseload of supply of coarse flake graphite to the expandable graphite market.

“The flake graphite supply issue in China, driven largely by the enforcement of environmental policy that has resulted in the closure of a large number of mines, is a reality. We are confident that there is demand for Chilalo graphite that vastly exceeds the tonnages in these agreements.”