International Graphite Ltd (ASX:IG6) is preparing to begin construction at the Collie Micronising Facility in Western Australia after entering into a funding agreement with the WA Department of Jobs, Tourism, Science and Innovation (JTSI) for $4.5 million.
The agreement, made on behalf of the State Government of Western Australia, will be drawn down over the project construction period as milestones are achieved.
IG6 expects to use about $2 million of the grant for the first stage of construction, building a 3,000-tonne-per-year micronising facility at a total estimated capital cost of about $4 million – Stage 1 is already fully funded to mechanical completion.
The remaining $2.5 million will be applied to the second stage of facility expansion, which is set to double production capacity to about 10,000 tonnes per year.
Mine-to-market strategy
“We are excited to be pushing ahead with the construction of the new plant at Collie,” International Graphite managing director and CEO Andrew Worland said.
“Establishing a micronising business in Collie has been an important step in our development plans.
“Critically, it will establish the company as a producer in the graphite industry and build further our technical skills as we progress our Springdale mine to market battery anode material strategy.”
IG6 intends to feed its graphite micronising facility with graphite from its flagship Springdale Graphite Project, the second-largest graphite deposit in Australia.
The company recently secured a second mining licence over the project, unlocking the potential of both main deposits and its 3.2-million-tonne graphite resource.
Read more: International Graphite exceeds battery-grade specifications in graphite concentrate purification tests
International Graphite is targeting graphite products of 95% total graphitic content (TGC) and 99% TGC micronised products from graphite concentrates produced at Springdale.
“At those production levels, our Collie facility will be amongst the most significant global producers of micronised graphite outside of China,” Worland explained.
Next (LON:NXT) steps toward construction
From here, IG6 will advance a front-end engineering and design (FEED) study which will confirm the implementation schedule and forecast economics of stage 1 construction, expected to be complete within the coming months.
The company has identified several critical path items to advance, including:
- Local building approvals
- Construction of new buildings
- Connection to utilities and services including electricity grid
International Graphite is confident it can successfully bring its two-staged construction strategy to fruition, having gained operating experience from the Collie Graphite Processing & R&D Facility, which includes pilot scale micronising and spheroidising equipment and a qualification scale micronising plant.
“The facility has been instrumental in optimising equipment selection, vendor assessment, operating conditions and scaling of Stage 1 production capacity to achieve lower unit capital costs than was envisaged in the original 2023 feasibility study,” the company stated.
Read more: International Graphite to capitalise on US demand for Australian graphite