Name of the Project
Balama graphite project.

Location
Mozambique.

Client
Syrah Resources.

Project Description
A feasibility study has confirmed Balama as a project with low capital intensity and technical risk, but attractive returns. As part of the study, a maiden proved and probable graphite ore reserve has also been declared. This ore reserve has since been increased to comprise 114.5-million tonnes at 16.6% total graphitic carbon (TGC) for 19-million tonnes of graphite.

Balama will be a high-grade, openpit operation using conventional mining methods, with an extremely low stripping ratio. Operations will start with free-dig mining within the high-grade pits of Balama West using conventional truck-and-shovel mining. Operations will shift to the pits in Balama East thereafter.

The processing plant will have a feed rate of two-million tonnes a year using conventional processes, including crushing and screening, grinding, flotation, filtration and drying, as well as classification, screening and bagging.

Graphite concentrate will be transported to and shipped at the Port of Nacala, about 490 km away, using a sealed highway south-east of the project.

Syrah also intends to pursue its downstream strategy, which involves further processing of flake graphite from Balama into spherical graphite at a plant in Louisiana, in the US. Spherical graphite is a high-margin, value-added product, which is experiencing significant demand, owing to its use in lithium-ion batteries for electric vehicle and energy-storage applications.

Jobs to be Created
Not stated.

Net Present Value/Internal Rate of Return
Based on the assumptions used in the feasibility study dated May 2015, the Balama project has a post-tax net present value, at a 10% discount rate, of $1.1-billion and an internal rate of return of 71%, with a payback period of less than two years from commercial production.

Value
The initial capital expenditure for the project is $185-million.

Duration
Commissioning is expected in the second quarter of  2017.

Latest Developments
Attrition cells have been added to the Balama process flowsheet, which will potentially enable 96.5% to 98.8% TGC concentrate to be consistently produced across a range of flake sizes. Higher selling prices can be achieved for graphite concentrate grades higher than 97% TGC. A higher concentrate grade will also reduce the downstream processing costs of spherical graphite by decreasing acid consumption.

The estimated capital expenditure for the attrition cells will have no material impact on the capital forecast for the project, and a minimal increase in operating costs (less than $10/t of concentrate produced). Installation of this equipment is expected to be easily integrated into the existing flowsheet.

On-stream analysis have also been added, which will monitor the TGC content of the graphite slurry and assist in ensuring that the final graphite concentrate produced will be to the required TGC specifications.

On Budget and on Time?
Commissioning remains on schedule for the second quarter of 2017.

Key Contracts and Suppliers
CPC Engineering (detailed engineering and design).

Contact Details for Project Information
Syrah Resources, GM – investor relations, John Knowles, tel +61 419 893 491 or email ljknowles@optusnet.com.au
CPC Engineering, tel +61 8 9365 0300, fax +61 8 9365 0333 or email CPCprojects@cpceng.com.au.