The global graphite chain is desperately seeking options for lower risk but longer life alternative supply sources for key battery minerals.
Australia can offer a niche solution, according to an Adelaide-based developer of the world’s fifth largest reported graphite reserve.
Addressing the Paydirt 2019 Battery Minerals Conference in Perth, Renascor Resources’ MD, David Christensen, said while the Chinese had historically dominated supply and production, that dynamic had now changed and China was even becoming an importer of graphite.
“Everyone has known for five years that China will reach a tipping point and we are at that point,” Christensen said.
“But this has forced users to look worldwide for projects of substantial scale that have the grade but can deliver the two modern era requirements of long-term potential and low sovereign risk.
“Our Siviour project in South Australia – the largest graphite ore body in Australia – offers that potential by a wide margin compared with other Australian offerings – and within a mining jurisdiction that is well regulated and understood.
“Siviour can easily join this global graphite supply chain because we can be competitive on cost against China and some of the key African sources.”
Rencascor is close to securing mining approvals for Siviour near Arno Bay on South Australia’s Eyre Peninsula.
Its initial 30 year mine life has a Stage 1 start-up cost of US$29 million from next year at a rate of 22,000 tonnes of graphite concentrate per annum then moves to a Stage 2 expansion at an additional US$91 million cost but significantly expanding output to 156,000 tonnes p.a. concentrate.
Feasibility studies have indicated Siviour can generate mine concentrate at US$335 per tonne at full development – one of the lowest operating costs of any graphite producer in the world.
A DFS is well advanced and a decision to mine is expected later this year.
The project, whose mineralisation commences just two metres below surface and is continuous in width, breadth and depth, contains ore reserves of 45 Mt for 3.6 Mt of contained graphite.
Renascor is in advanced negotiations with initial offtake customers and expects to move on some of those during 2019.