Phase 1 of the Molo graphite project, in Madagascar, has been delayed and the process plant will now only be commissioned in the September quarter, Toronto-listed NextSource has reported.
The company explained that although the processing plant, which was fabricated and constructed at an offshore facility, was ready to be shipped to the mine, Covid-19 travel restrictions and recent cyclone activity in Madagascar had delayed the start of earthworks and civil works at the mine site.
NextSource pushed back the commissioning of the 17 000 t/y processing plant from the second to the third quarter of 2022. Once operating, Molo would be one of the few producing graphite mines outside China.
Meanwhile, the company also announced the preliminary economic assessment (PEA) of expanding Molo. The Phase 2 study considered an enhanced expansion consisting of a standalone processing plant with a production capacity of 150 000 t/y of flake graphite concentrate over a 26-year mine life.
Capital CostsThe PEA projects capital costs for Phase 2 at $155.8-million, with a pretax net present value, using an 8% discount, of $929.6-million and a pre-tax internal rate of return of 41.1%.
CEO Craig Scherba said that he was pleased with the PEA results, which defined strong financial returns and underlined the scalability of the project.
“A Phase 2 expansion of this magnitude will position NextSource as a major global supplier and will underpin our vertical integration strategy to construct our own battery anode facility in due course, enabling direct supply to the electric vehicle battery market.”
The PEA’s enhanced Phase 2 capacity was determined based on discussions with automotive manufacturers and battery anode offtake partners.