Walkabout Resources Ltd (ASX:WKT) has produced and shipped the first consignment of on-specification graphite concentrate from the Lindi Jumbo Graphite Mine in Tanzania.
The first consignment of on-spec bagged graphite concentrate has been shipped to Dar es Salaam for sale to Wogen under the exclusive offtake agreement. This first sale forms part of a larger order from an end customer in Europe.
Volumes shipped are still relatively modest due to limited plant availability and utilisation during the commissioning and early ramp-up phase. The commissioning team is now focused on improvements in plant performance, availability and utilisation.
An “exciting milestone”
Walkabout managing director and CEO Andrew Cunningham said, “The successful production of on-spec, saleable product during the commissioning process at the Lindi Jumbo plant facility is an exciting milestone.
“To achieve our first concentrate shipment from site, at a time when customers are looking to shore up their graphite supply chains is a rewarding and outstanding outcome for the tenacity of our people, community, contractors and shareholders.
“We now have the opportunity to engage with more end-users as we continue to demonstrate we have a viable product and that we are serious contenders in development of non-Chinese graphite supply.”
Costs cut
Walkabout explained that the largest production cost for Lindi Jumbo is power. While Lindi Jumbo has 4MW of installed diesel generated backup power available it was not required at all during May.
Having the plant run 100% on grid lowers the power cost by around 80%.
With the successful commissioning of the burner for the rotary dryer, the operations team has been able to successfully run the dryer at a lower temperature while still meeting requisite moisture levels in the graphite concentrate. This has resulted in fuel savings for the dryer of more than 50%.
The company says that if these experiences are sustained into the future, it should result in meaningful reductions to plant operating costs.
Coming to market at a “fortuitous time”
Walkabout has provided the following assessment of the graphite market:
“In mid-May, the US government announced the future imposition of a 25% tariff on Chinese natural graphite. This has added to market concerns over security of supply chains after China imposed export restrictions for graphite.
“Reflecting these developments, there appears to be a widening gap between Chinese domestic and ex-China prices. That has also been our experience in sales orders received to date. Lindi Jumbo production is coming to market at a fortuitous time and remains fully exposed to resulting price increases.”