Battery Minerals has inked a memorandum of understanding (MoU) with US-based graphite processing specialist Urbix for a potential joint venture (JV) in Mozambique.
Under the terms of the MoU, the two companies will work together to develop an environment-friendly graphite purification facility in Mozambique, completing all the necessary feasibility study work.
It is envisaged that the facility will source graphite concentrate from Battery Minerals’ Montepuez project, as well as potentially toll-treat graphite from other mines in the area, and would use the proprietary Urbix purification method.
“There is overwhelming evidence that the demand for graphite is going to soar as the take-up of lithium batteries gains speed,” said Battery Minerals MD Jeremy Sinclair on Thursday.
“The proposed processing JV with Urbix is aimed at ensuring we are well positioned to capitalise on the demand for not only graphite concentrate but also the higher-margin processed product which is essential to the battery manufacturers.
“At the same time, we believe there is excellent potential to reduce the cost of developing Montepuez through a partnership approach with contractors. The strong outlook for the project is also reflected in the fact that some contractors have expressed an interest in being part of the project funding package.”
As part of its funding strategy, Battery Minerals has been investigating options to reduce the capital expenditure at its project, including a review of the owner-operator model currently assumed for Montepuez.
The ASX-listed company said that the switch to a contracting model could reduce the current funding requirements for Montepuez of $55-million by up to $6-million.
This reduction in funding requirements, combined with the participation of contractors in the funding solution, will be weighed up against possible increases in operating costs, which could result from the shift towards a contractor model.
Battery Minerals intends to start graphite flake concentrate production at Montepuez at a rate of 50 000 t/y, with production set to grow to over 100 000 t/y as the project expands.
