International Graphite’s (ASX: IG6) plans to produce battery-quality anode material in Western Australia for the burgeoning electric vehicle industry has received a $1.3 million boost after securing a timely tax rebate from the Australian Taxation Office for its research and development (R&D) activities in the past year.
The cash injection bolsters the company’s funding for its pathway to developing its battery anode material and management says its recently-updated scoping study provides a compelling set of numbers for its mining and downstream operations. It says the R&D rebate gives it a stronger working capital position as it continues its mission.
The company’s Springdale graphite project, about 25km from the small WA town of Hopetoun, has a mineral resource estimate of 49.3 million tonnes of graphite at 6.5 per cent total contained graphite (TCG) for 3.2 million tonnes of the highly sought-after battery mineral. Hopetoun sits about 590km south-east of Perth.
Management says its recent, integrated mine-to-market scoping study provided robust economics for the project, with significant potential for expansion at both the Springdale mine and its anticipated Collie downstream processing facility. It says it plans to provide graphite concentrate from the Springdale mine to its proposed processing operation at Collie – a trucking distance of about 500km.
The Collie battery anode material facility (BAM) is designed to process a 95 per cent concentrate, producing anode material for the lithium-ion battery industry.
The company says key outcomes from the study include a globally competitive cost structure and multi-decade mine life using only about 15 per cent of the existing resource, with an average TGC feed grade of 9.5 per cent and a concentrator throughput of 500,000 tonnes per annum.
It believes there is tremendous potential to significantly scale-up the project from the base-case scenario used in the study.
Our immediate focus is to move rapidly through the definitive feasibility phase for Springdale and to accelerate further infill resource and exploration drilling at Mason Bay, one of the newest graphite finds at Springdale, so we can continue expanding and upgrading the current Mineral Resource estimate.
International Graphite managing director and chief executive officer Andrew Worland
The company has received strong support from both State and Federal Governments, in addition to the local communities of Hopetoun, Ravensthorpe and Collie, for its planned operations.
The Chinese Government’s recent decision to restrict the export of its graphite products has triggered a greater importance for the development of world-class operations in alternative regions to provide for the future demand for the “black lead”.
The significance is highlighted with China currently supplying more than 80 per cent of the world market. When you consider businesses across Europe, North America, Korea and Japan have made huge financial investments to build battery gigafactory capacity, it drives the point home that there will almost certainly be a growing need for a reliable and consistent supply of graphite.
And International Graphite appears as well placed as any aspiring company to meet the future ramp-up in demand for the important battery commodity.
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