PERTH (miningweekly.com) – A definitive feasibility study (DFS) on a concentrate-only production scenario at the Munglinup graphite project, in Western Australia, has confirmed that the project would become a crucial asset in ASX-listed Mineral Commodities’ ambition to supply natural graphite.

With the completion of the DFS, the company has now taken the decision to increase its shareholding in the Munglinup project from 51% to 90%, under a farm-in and joint venture (JV) agreement with Gold Terrace.

Mineral Commodities will pay Gold Terrace A$800 000 in cash and would issue 30-million fully paid ordinary shares in exchange for the additional stake.

The DFS into the Munglinup project estimated that the project would require a $61-million capital investment to produce an average of 52 000 t/y of graphite over a mine life of 14 years.

The study estimated a post-tax net present value of $111-million and an internal rate of return of 30%, while life-of-mine revenues were estimated at $853-million and life-of-mine earnings before interest, taxes, depreciation and amortization at $426-million.

Mineral Commodities executive chairperson Mark Caruso on Wednesday said that the completion of the DFS was an important milestone in the anticipated development of the project.

“The DFS further enhances the company’s ambitions to build a global, vertically integrated carbon business based on two global strategic operating production centers in tier 1 jurisdictions, Australia and Norway, producing sustainable natural graphite concentrate as a crucial raw material for the production of precursor and active anode materials.”

With the DFS now complete, Mineral Commodities will continue ongoing testwork and market analysis as part of a determined integrated downstream value-adding strategy, focused on the production of precursor and active anode materials.

The company will continue with its technical and economic study work, considering the production of purified, micronized, spheronised and coated Munglinup concentrate to identify the optimal economic outcome from the deposit.