PERTH (miningweekly.com) – Graphite developer Walkabout Resources has signed a binding global sales, purchase and marketing agreement with international commodities trading house Wogen Pacific.
Under the terms of the agreement, Wogen will actively market Walkabout’s graphite concentrate, initially contracting to buy and market a minimum of 20 000 t/y and a maximum of 30 000 t/y of concentrate from the Lindi Jumbo project, in Tanzania.
The agreement will have a five-year term.
Walkabout will receive an advance payment on 80% of the value of each consignment of concentrate contracted by Wogen, which will be paid following the receipt of shipping documents.
The remaining 20%, less the Wogen commission, will be paid to Walkabout on the receipt of full payment by Wogen.
Walkabout executive chairperson Trevor Benson said on Thursday that the Wogen agreement perfectly complemented the company’s strategy to outsource the major components of the Lindi Jumbo project.
“As a result, Lindi Jumbo will not need to establish large and expensive marketing offices across several jurisdictions to manage its sales, customer relations and global logistics.
“The company will be able to leverage the marketing expertise of Wogen across the globe for sales at favourable prices, and to secure additional offtake arrangements.”
Benson said that the agreement was a key element to de-risking the graphite project and attracting development capital leading up to construction and the first period of production.
Walkabout has previously inked two binding offtake agreements at Lindi Jumbo, accounting for up to 75% of the planned annual production over the first five years of the operation.
The 40 000 t/y project is expected to have a mine life of some 24 years, and will cost $27.8-million to develop.