Name and Location
Epanko graphite project, Tanzania.

Client
Kibaran Resources.

Project Description
A bankable feasibility study (BFS) on the Epanko project has confirmed the viability of a conventional opencut mine and conventional flotation processing plant.

The project has maiden proven and probable reserves of 10.9-million tonnes at 8.6% total graphitic carbon (TGC).

Mining will be conducted on a five-day, day-shift-only basis, with total movement of 57 000 bcm a month using an 80 t excavator and 40 t articulated trucks.

Mining will be from the Eastern and Western deposits, located within 1 km of the run-of-mine (RoM) pad. The Western deposit consists of mining a strike length of 850 m along the top of the hill to a depth of 180 m, with the Eastern deposit in a small valley and mined to a depth of 120 m.

The mine schedule has been formulated to target RoM feed within the limit of 440 000 t/y mill throughput, with a maximum of 40 000 t of concentrate output. From the ore reserve, only material over an 8% TGC cutoff will be fed to the plant for the first 16 years, after which stockpiled lower-grade material will be reclaimed and processed. There is 6.5-million tonnes at 9.9% TGC of high-grade feed sourced from 68% proved and 32% probable ore reserve over this period.

The prestrip will be limited to total movement of 180 000 bcm over four months to establish the Eastern deposit, RoM pad, haulage roads, and diversion bunds and drains. The Eastern deposit will be the main source for high-grade plant feed, with the Western deposit starting as a feed source after six months of processing.

The processing plant will include a two-stage crushing circuit that will deliver product to a storage bin. Ore will be reclaimed from the storage bin and delivered to a single-stage rod mill operating in closed circuit with a screen. The undersize ore from the mill product screen will report to a flotation circuit for recovery of the graphite using a circuit comprising rougher, scavenger, primary cleaner and secondary cleaner flotation stages. Graphite concentrate will be filtered and dried. Dry graphite concentrate will be screened into various product sizes and bagged for shipping. Flotation tailings will be transported to the tailings thickener and then be pumped to the tailings storage facility.

While the Epanko production rate has been set at 40 000 t/y of concentrate, the process plant has a nameplate throughput capacity of 480 000 t/y and can thus produce additional product.

Kibaran has developed an expansion strategy that can cater for expected future increases in demand for premium-quality large-flake graphite. The Epanko deposit can easily support a production rate of 100 000 t/y of concentrate, with the expansion capital being funded from cash flow. The additional footprint required for the expansion has been catered for in the design layout.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at a 10% discount rate, of $197.4-million and a pretax internal rate of return of 41.2%, with a payback of 2.7 years.

Value
Capital expenditure is estimated at $77.5-million.

Duration
First production from the project will start about 17 months after the completion of project financing.

Latest Developments
After securing $2-million through a share placement earlier this year, in conjunction with additional funding mechanisms, junior graphite developer Kibaran Resources has announced that technical due diligence on its Epanko graphite project is now complete, making Kibaran the first ASX-listed company to undergo banker’s due diligence for a graphite project in Africa.

Independent engineering firm SRK, which was appointed by KfW IPEX-Bank to conduct technical due diligence as part of the bank’s senior debt financing due diligence on Epanko, has submitted its final IER to the bank. The IER includes a detailed action plan to address the recommendations that have been identified.

Kibaran has noted that the Independent Engineer’s Report (IER) is considered the key aspect of KfW IPEX-Bank’s rigorous approval process for an up to $40-million senior debt facility for the development of the project.

Having now confirmed the bankable status of the Epanko feasibility study, prepared by GR Engineering, KfW IPEX-Bank is reviewing the IER to prepare for the submission of the UFK Guarantee application.

The IER has focused on the Epanko BFS and the associated financial model. It has also involved detailed analysis of the BFS including the geology, mining, metallurgy, process testwork, pilot plant work, capital and operating costs, pricing and the financial model. The review has also assessed all project-related risks and included a site visit to Epanko at the end of January.

The IER will be forwarded to Nedbank, which has indicated an interest in providing senior project debt financing of up to $30-million, alongside KfW IPEX-Bank.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Kibaran Resources, tel +61 8 6380 1003 or email info@kibaranresources.com.