TSX-listed NextSource Materials recently released the results of its 2019 Feasibility Study (FS) for its 100%-owned Molo graphite project in southern Madagascar.
Madagascar – The FS takes into account updated mine capital equipment and mining costs, as well as current 12-month rolling flake graphite pricing on a FOB China basis, supplied by UK-based battery mineral commodities research firm, Benchmark Minerals Intelligence.
The FS was based on a Front End Engineering and Design study (FEED), and subsequent Detailed Engineering studies. It incorporates the procurement of all mining equipment, off-site modular fabrication and assembly, factory acceptance testing, module disassembly, shipping, plant infrastructure construction, onsite module re-assembly, commissioning, project contingencies and working capital.
All capital and operating costs expressed for Phase 1 are considered to be accurate to +/- 10%, and accurate to +/- 12.5% for Phase 2.
In order to ensure that NextSource maintains a first-mover competitive advantage, the FS was designed to provide a flexible mine development approach that comprises a unique, all-modular build solution yielding optimal cashflow and return metrics with suitable flexibility to enable a rapid response to the anticipated market demand for graphite.
Off-take agreement in place
NextSource has an off-take agreement in place with a prominent Japanese trader, whom is a major supplier of flake graphite to Japan’s largest battery processor and manufacturer of graphite anode material in lithium ion batteries for electric vehicle applications.
The company is currently in the process of formalising an additional sales agreement with a leading European trader.
Phase 1 of Molo’s production plan is 17 000 tpa of finished SuperFlake concentrate for the first two years of production followed by a ramp-up to Phase 2 production of 45 000 tpa.