ASX-listed International Graphite (IG6) on Wednesday told shareholders that the company had selected a preferred site for its proposed Collie graphite battery anode material (BAM) facility, in Western Australia.
The company has inked a non-binding memorandum of understanding for an option agreement to negotiate a lease over a 20-ha site in the Coolangatta industrial area. The lease period will be 20 years, with a further 20-year extension available.
IG6 MD and CEO Andrew Worland said securing the Collie site was a significant milestone in the development of the proposed Collie graphite BAM facility.
“The land is cleared, well served by sealed roads and civil infrastructure, with ample space to accommodate our initial design and future expansion plans. Most importantly, it is only metres from the existing power network which gives us the opportunity to purchase energy at the lowest possible transmission cost.”
An April scoping study into the proposed Collie graphite BAM facility estimated the processing of 40 000 t/y of graphite concentrate to produce up to 18 600 t/y of coated spheroidised purified graphite (CSPG) and 17 000 t/y of micronized by-products.
The study estimated a total capital cost of $222-million, including contingency, with operating costs estimated at $3 175/t CSPG produced. The project’s pre-tax net present value has been estimated at $626-million and its internal rate of return at 41%.
The scoping study also estimated average yearly revenue of $172-million and earnings before interest, taxes, depreciation and amortisation (Ebitda) of $100-milion.
If the decision is taken to only produce uncoated spheronidised purified graphite (USPG) facilities, the plant would be capable of producing 20 000 ty of USPG and 17 000 t/y of micronized by-products, at a capital investment of $87-million and yearly operating costs of $2 029/t USPG.
The USPG operation will have a pre-tax net present value of $290-million and an internal rate of return of 48%, and could generate annual revenues of about $59-million and Ebidta of $43-million.
IG6 previously said that while the financial forecasts for the scoping study were based on the purchase of graphite concentrates from third-party sources, it is the intention to integrate the company’s 100% owned Springdale graphite project with the development of the Collie graphite BAM facility. Once Springdale has been advanced to a sufficient level of detail to allow forecasts to be published, the company will update the scoping study accordingly.
