Thanks for your email.
I appreciate that the recent drop in the share price has been unsettling.
On our side, we are still on track with our programs to accelerate the development of phase one of the upstream as soon as possible. To minimise the construction timetable, we have already moved ahead with more detailed engineering and procurement activities. You may have seen the recent announcement regarding the agreement to acquire the freehold rights to the land that overlays the mineral lease. This will permit us to move forward with more on-ground activities. Perhaps most importantly, we continue to work to conclude beneficial offtake agreements that will permit to make a final investment decision.
I am also mindful that the graphite sector (as well as the broader space) has been experiencing downward commodity price pressure for the last year. When China was importing significant amounts of graphite a year ago, prices pushed up to levels would incentive new production sources like ours. Chinese net imports then faded away, and the graphite price declined. Inexpensive synthetic graphite added to downward prices on graphite.
As we move forward into 2024, the factors that impacted graphite last year could quickly change. Whilst China has its own graphite supply, it will be difficult for its own supply to meet its forward demand for much longer. With respect to synthetic, we similarly do not see the factors leading to low-priced synthetic as being sustainable, nor replicable outside of China. Finally, policy initiatives like the IRA in the USA and the graphite export restrictions in China have the potentially to quickly change the graphite market.
We believe our project remains one of the highest quality sources of new graphite supply globally, with this quality recently backed up by the work on our BAM Study. On this basis, we plan to continue our work to start the Siviour mine as soon as possible, while simultaneously working to move into the downstream phase and expand growth opportunities.
Our entire team in quite busy now, and we expect we will be able to make good progress. We intend to provide the market as we progress through Siviour’s development, with a view to restoring some of the value that we believe is inherent in both our project and the overall graphite sector.
I hope this answers your questions.
If you have any more queries, please let me know.
Kind regards,
David
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David Christensen
MANAGING DIRECTOR
Level 5, 149 Flinders Street
Adelaide, South Australia 5000
Australia
p. +61 (0)8 8363 6989
m. +61 (0)429 643 770
e.
[email protected]find: www.renascor.com.au
follow: @Renascor_ASX
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