Name of the Project
Balama graphite project.

Location
Cabo Delgado, Mozambique.

Project Owner/s
Syrah Resources.

Project Description
Balama is one of the highest-grade, large-flake deposits globally. The project has mineral reserves of 108-million tonnes grading 16% total graphitic carbon (TGC) and mineral resources of 1.42-billion tonnes grading 10% TGC.

The project 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 using a sealed highway south-east of the project and shipped at the Port of Nacala, about 490 km away.

The mine is expected to produce an average of 365 000 t/y of graphite concentrate during its first ten years of production. Balama has a 50-year mine life.

The mine’s production will be sold to traditional industrial graphite markets and emerging technology markets.

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 that is currently in significant demand, owing to its use in lithium-ion batteries for electric vehicle and energy-storage applications.

Potential Job Creation
The labour contingent increased to 499 staff in the quarter ended June 2021, excluding contractors.

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 the start of commercial production.

Capital Expenditure
Not stated.

Planned Start/End Date
Not stated.

Latest Developments
The US International Development Finance Corporation (DFC) has approved a $150-million conditional loan commitment to Syrah Resources’ subsidiary Twigg Exploration and Mining.

If completed, the loan will fund the capital requirements for the Balama project, including feasibilities for the development of the vanadium resource, expansions of the tailing storage facility, and working and sustaining capital at the project.

The loan facility will have a 13-year term and interest will be fixed at applicable long-dated US Treasury rates, plus a margin.

Pending US Congressional notification, the DFC will be able to issue a conditional commitment letter to Twigg for the loan. The loan is subject to the completion of due diligence, negotiations of detailed terms and legal documentation. 

Key Contracts, Suppliers and Consultants
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.