NEWS & ANALYSIS
Major role for Africa in battery minerals

Perth, 15 March (Argus) — Melbourne-based graphite producer Syrah Resources' development of its Balama project in Mozambique is a vote of confidence for Africa to play a major role in battery minerals production.

The project has gone from discovery to initial production in four years, delegates at a battery mineral conference in Perth were told.

It is awaiting final ratification of its Mining Agreement before starting commercial output of high purity flake graphite at a rate of 160,000-180,000 t/yr in 2018 moving up to 250,000-300,000 t/yr from 2019.

At full production, it will be one of the world's largest producers of graphite for use in the anode of lithium-ion batteries.

Despite political risk and regulatory uncertainty in Africa, battery mineral projects are progressing on the continent.

Regulatory uncertainty has cast doubts on the sustainability and profitability of some projects in countries. Tanzania and the
Democratic Republic of Congo have both recently made sweeping changes to their mining legislation and taxation codes.

"Syrah will show that graphite can be produced outside of China in a compressed time. This could be a big vote of confidence for battery minerals production in Africa," Black Rock Mining's chief executive John de Vries said.

Black Rock is nine months into developing the Mahenge graphite project in Tanzania, the world's fourth largest graphite resource.

Africa is not the only difficult jurisdiction in the world, he said. It can take two to three years to get heritage rights in Australia. "I worked on mining projects in the former Soviet Union and would rather work in Africa any day," he said.

African countries should not be lumped together, but considered as individual cases with different experiences in nations such as Namibia and Botswana, compared to desionations such as the DRC, Nigeria and Zimbabwe, BlackEarth Minerals managing director, Tom Revy said.

BlackEarth is developing the Maniry and Lanapera graphite projects in Madagascar which is often treated as an African country although it is a separate island nation.

"Madagascar is open for business with major cobalt, nickel and miner sands projects and has China , the US and Germany among its major trading partners," he said.

The reality on the ground in Africa is often better than the headlines, Force Commodities' chief executive, Jason Brewer said. The company is developing the Kitotolo and Kanuka lithium projects in the DRC.

"It is definitely a case of buyer beware. I have spent half of my time in the DRC over the past two years and I now love the place. You have to have a strong appetite for risk and a lot of flexibility. I would go crazy in Australia waiting for two years to start drilling," he said.

Although conflict minerals are a problem in the DRC, companies such as Force Commodities are engaging independent audit consultants to ensure that their supply chains meet the standards required by major trading groups such as Glencore and Trafigura as well as global automakers.

The focus for battery minerals-focused companies in Africa has to be on building a mine that has a product that the market wants, Battery Minerals' chief financial officer Jeff Dawkins said.

Battery Minerals is developing the Balama and Montepuez projects in Mozambique.

Other battery minerals project in Africa include several cobalt projects in the DRC, a cobalt project in Namibia, and lithium projects in the DRC, Zimbabwe and Mali.

The DRC is the world's largest producer of cobalt, a critical battery mineral, and increasing amounts of graphite and lithium are being discovered and developed across the continent.

This analysis was published in Argus Metals International.


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