A definitive feasibility study (DFS) for the Siviour graphite project, in the Eyre Peninsula, has estimated that the project would require a capital investment of A$118-million based on a staged development, with an initial production of 80 000 t/y during the first four years of operation.
ASX-listed Renascor Resources on Monday said that the project would be expanded to 144 000 t/y from year five onward, with the A$77-million expansion to be funded from project cash flows.
Over the 40-year mine life, the Siviour project is expected to produce 105 000 t/y, generating average earnings before interest, taxes, depreciation and amortization of A$83-million.
Operating costs for the project have been estimated at A$508/t over the life of the project.
The DFS estimated a post-tax net present value of A$388-million and an internal rate of return of 33%.
“This DFS confirms Siviour’s status as a low-cost, tier one graphite project that can achieve consistently attractive profit margins even in the current lower graphite price environment,” said Renascor MD David Christensen.
“We believe the cost advantage, coupled with our location in the low sovereign risk jurisdiction of South Australia, will enable Siviour to become a premier provider of graphite for the growing lithium-ion battery market, as this sector becomes the dominant end-user of natural flake graphite.”
Christensen said that with the DFS now complete, Renascor will work to advance binding offtake agreements, and will work with finance partners to secure funding for the Stage 1 development.
