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PERTH (miningweekly.com) – The share price of graphite hopeful Triton Minerals soared by nearly 65% on Wednesday, as the company announced that it had signed a binding offtake agreement worth $2-billion.
Under the terms of an agreement inked with China’s Yichang Xincheng Graphite Company, Triton would supply 100 000 t/y of graphite concentrate for a period of 20 years, with the graphite to be priced at a minimum sales price of $1 000/t.
“This is a very special day for Triton as this binding commercial agreement is with a graphite specialist organisation that has mined, manufactured and sold expended graphite products for nearly 20 years,” said Triton MD and CEO Brad Boyle.
A recent scoping study into Triton’s Nicada Hill graphite project, in Mozambique, estimated that the project could support production of 210 000 t/y of graphite concentrate.
The scoping study was based on a 51-million-tonne indicated resource, grading 12.4% graphitic carbon, for 6.3-million tonnes, and incorporated a 1.8-million-tonne-a-year throughput plant.
It was estimated that the project would require a capital investment of about $110-million, while the free-on-board cash costs were estimated at $315/t.
Production would likely start in 2017, and the project was estimated to have an initial mine life of 30 years.
Boyle noted that with the adoption of the binding long-term offtake agreement, Triton was now positioned to continue with the rapid development of the large scale production.
The offtake agreement would be subject to Triton receiving all government approvals, commissioning the processing plant and achieving commercial production within 36 months of signing the agreement.
Triton shares were trading at a high of 71c each on Wednesday, up from a low of 52.5c each.