Evion Group NL (ASX:EVG) is making significant strides in the development of the Panthera expandable graphite joint venture (JV) project in Kurkumbh, India, ensuring it is on track for first production next quarter.
Evion is developing Panthera Graphite Technologies (PGT) in collaboration with JV partner Metachem Manufacturing Co Pvt Ltd.
''The PGT management and construction team is doing a wonderful job in fast-tracking development of our production site at Kurkumbh, near Pune, India,” Evion managing director Tom Revy said.
“Extensive infrastructure is now in place and we expect the main manufacturing building will be completed soon with equipment to be installed and commissioned shortly after.
“This will pave the way for the start of production and cash flow in the coming quarter, enabling us to capitalise on the strong global demand for expandable graphite.”
Good progress
Engineers and construction personnel are on site, working on civil works and pre-fabricating 4,000 square metres of buildings.
The installation of production equipment is set to conclude over the next three months, led by lead contractor Ulka Projects Private Ltd.
Prior to the construction commencement, a decision was made to amplify the main processing facility structure to accommodate a doubling of production in the short term.
This move is to optimise capital expenditure and ensure minimal disruptions when expansion takes place in the second year of production, financed by operational cash flow.
Key support infrastructure, such as offices and water and fuel storage facilities, is progressing with ongoing civil earthworks. Commissioning of these facilities is anticipated in the final quarter of the year.
The site has maintained a record of zero lost-time injuries so far.
Civil earthworks are ongoing.
Equipment installation
The procurement of long lead items is on track, with about half of the necessary equipment already ordered and the balance scheduled to be ordered within the next six weeks.
Evion foresees no logistical concerns regarding the delivery of the items as they are sourced from reputable local companies.
The commissioning of the processing facility is set to begin in November, boosted by a secondment arrangement with Metachem to bring in experienced personnel.
Sales talks
JV company PGT has placed large orders of graphite concentrate following successful testing to ensure that the resulting expandable graphite is suitable for European markets.
With the outcome positive, PGT has commenced negotiations with potential buyers for the sale of expandable graphite.
Discussions have been promising and the company anticipates achieving prices in line with or surpassing those laid out in the scoping study.
Robust returns
Evion expects the JV to bring in gross revenue of US$7 million in the first year of operations, growing to US$18 million annually following the planned expansion of production.
This optimism is based on partner Metachem’s track record of producing expandable graphite and supplying the product to the global market for decades.
It has a strong business model, which provides a degree of commercial security to the JV, while Evion leverages its strong logistics and global marketing network to market and sell the product.