BlackEarth Minerals NL (ASX:BEM) is putting the final pieces in place for a cornerstone feasibility study on its Maniry Graphite Project in Madagascar.
As part of the study completion process, managing director Tom Revy updated the Minister of Mines and Strategic Resources, Dr Olivier Rakotomalala, in Madagascar late last month.
The discussion and study completion pave the way for BlackEarth to accelerate negotiations around binding offtake contracts and secure final project development permits and approvals.
Maniry — reported to host 2.58 million tonnes of contained graphite — is planning to commence construction in 2024.
This timing will enable BlackEarth to capitalise on the surge in graphite demand, which is widely forecast to occur due to the huge increase in lithium-ion battery production and the lack of investment in new graphite projects.
Ultimately, this ‘perfect storm’ of conditions is expected to result in a supply deficit from as early as next year.
“Next chapter in our growth”
Commenting on the study’s conclusion, Revy said: “Completion of the Maniry feasibility study will be a pivotal point for BlackEarth as it paves the way for the execution of our three-pronged strategy to cash in on the forecasted deficit of graphite production.
“Once the definitive feasibility study is finished, we will move quickly to secure binding offtake agreements which will in turn enable us to push ahead with project development.
“We have a huge opportunity to benefit from the surge in graphite demand and prices expected to result from the ramp-up of lithium-ion battery production.
“Maniry is the cornerstone of our strategy and completion of the feasibility study will mark the start of the next chapter in our growth”.
Three graphite verticals
As it prepares to close out the study, BlackEarth has developed a three-pronged strategy to capitalise on the expected surge in graphite demand.
Down the line, it’s hoped these three verticals will generate multiple revenue sources.
First off, BlackEarth plans to focus on mining and concentrate production at the Maniry Graphite Project. This will generate a series of concentrate products for downstream processing that can be sold to third parties.
Second, the company plans to process the project’s concentrate fines into lithium-ion battery anode material.
A scoping study is underway to assess the viability of a manufacturing plant that can produce the spheronised and purified graphite required for lithium batteries in Europe.
Third, BlackEarth plans to generate expandable graphite for use in non-battery purposes, such as fire retardants and foils at the Panthera processing joint venture facility in India.
The plant is on track for commissioning in the 2023’s March quarter. Initially, it will process suitable concentrate from third parties, with Maniry to supply feedstock once it enters operation.