As a firm believer in the global movement of the transition towards clean energy sources, ASX–listed graphite developer Battery Minerals believes that its Montepuez graphite project in Mozambique can significantly contribute to this movement.
Newly-appointed MD, JEREMY SINCLAIR updated GERARD PETER on the mine’s progress.
Battery Minerals is focused on two graphite projects in Mozambique – Montepuez and Balama Central.
Both projects are located in the Cabo Delgado province in the north of the country, which is fast becoming a hive of graphite mining activity, led by a number of Australian companies. Montepuez has a Reserve of 42.2 Mt at 9.3% TGC.
According to a feasibility study completed in December 2018, Balama Central, with a Reserve of 19.7Mt at 11.1% TGC will produce circa 58 000 tpa of 96% TGC graphite flake concentrate over a 40 year lifespan.
Montepuez, the first of the projects to be developed, envisions a Stage 1 production output of circa 50 000 tpa graphite flake concentrate at 96% TGC.
And while production outputs and ore grade (%TGC) is higher at Balama Central, Sinclair explains that the Reserve size and battery quality characteristics of the Montepuez graphite will allow it to produce at much higher production rates as market demand increases in line with the transition to clean energy – at Stage 1 production outputs, life of mine expectancy is in excess of 80 years, making it a very lucrative and sustainable project.
Sinclair adds that the mining concession and port allocation have been granted and that offtake agreements are already in place. “Already, there is a 100-man camp constructed at the mine and two civil engineering projects have already been completed.
These are a tailings storage facility wall which is 750 m long, and the earthworks and roads for the process plant and site,” he adds. The completion of the process plant, opening of pits and erection of onsite office buildings now relies on funding.
Already the company is engaged in meaningful discussions with potential backers and should these come to fruition, Sinclair believes it will take about 15 months to complete construction from the point of funds being available.
In order to maximise the potential of the mine, Sinclair explains that the company has designed a lower capex Stage 1 around a lower production rate to increase the appetite for funding and lower execution risk, whilst still retaining optionality for modular expansion.
“Once we reach our production target and ensure that the supply chain is up and running and we are achieving our product specification, we can then look at increasing production to circa 100 000 tpa with a Stage 2.
Now, while Battery Minerals has identified the potential in supplying to the clean energy market, whether it be electric vehicles or stored energy, Sinclair states that its graphite can also meet the demands of traditional graphite markets such as lubricants, fire retardants and refractory materials.
“Our material has been tested for applications in the traditional graphite industry and meets specification, however the growing clean energy market will be the big catalyst to our growth,” he adds.
Given an increase in demand for battery metals, Sinclair believes that this market will be sustainably profitable in the long-term.
He alludes to the fact that the market has been under some pricing pressure of late, particularly because of subsidy cuts in China, but this should not have adverse long-term impact on profit margins.
Meanwhile, Sinclair acknowledges the role that the Mozambican government and the local community has played in helping get Montepuez closer to commercial production.
“In any country, securing the necessary approvals can be a challenge,” he states. “That said, it is good to have a regulatory framework to work with and to date we enjoy good relationships with the government.”
In addition, Battery Minerals currently employees 38 individuals from the local community on site – in total the company employs 60 Mozambicans for the Montepeuz project.
Furthermore, the company is also involved in various socio-economic initiatives in the areas it operates. For example, the company built a school in Nquenene, 7 km from the Montepuez project.
“Rather than just supplying a school building we also provide learning materials. We also provide all our local workers with a nutritious meal each day to ensure a standard of health is maintained.,” Sinclair points out
With a considerable resource, a very advanced project, and encouraging forecast demand for graphite, Sinclair is confident that Montepuez ticks all the right boxes and that Battery Minerals will secure funding to commence full-scale operations.
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