The Australian graphite company Kibaran Resources (ASX KNL / WKN A1C8BX)has developed a process for the production of battery graphite called EcoGraf, which is not only much more environmentally friendly than the usual methods, but also able to keep up with the costs of production in China. Now the company is presenting another positive study regarding the construction of an EcoGraf facility in Western Australia.
As Kibaran today announced, the independent experts at GR Engineering have completed technical studies to develop a battery graphitizing plant in the Kwinana Industrial Industrial Estate 30 kilometers south of Perth, the so-called Lithium Valley of Western Australia.
In it comes GR Engnineering on investment costs of 22.8 million USD for only 5,000 tons of capacity per year. The extension to 20,000 tonnes of battery graphite per year would then cost another $ 49.2 million. In addition, it is estimated that the investment in Kwinana would have net pre-tax value of $ 141 million and an internal rate of return (IRR) of 36.6%. The investment to achieve EBITDA is estimated at $ 35 million a year.
These figures are similar to those of another plant that Kibaran plans in the Asia-Pacific region, as reported in April. They are based on new studies based on an optimized flow chart. The material for the production of the battery graphite is to be obtained from various graphite producers worldwide, to ensure that Kibaran can also operate independently of its graphite project Epanko in Tanzania.
The final product will be delivered to lithium-ion battery production customers in Asia, Europe and the US, according to the company's announcement today. Once the Epanko project is in production, Kibaran can also consider potential further processing options in Tanzania and the East African region.
The company has already received confirmation from the Western Australian authorities that a 4 hectare site will be made available for the new plant in the Kwinana Industrial Zone. Importantly, in this regard, a number of possible shipping options - as part of GR Engineering's studies - were investigated and demonstrated that the Kwinana site can compete on the cost side with existing production in China. In addition, Australia's reputation as a reliable producer of high quality industrial products is significantly better.
Kibaran also notes that there are several initiatives by the Australian and Western Australian governments to promote the emergence of lithium-ion battery manufacturing facilities. Kibaran's plans for the construction of a production facility for battery graphite were met with great interest, it was said.
Because the demand for battery raw materials is high and should continue to increase - and graphite is an important part of lithium-ion battery production. This is an opportunity Kibaran will benefit from establishing EcoGraf facilities in the Asia-Pacific, Europe and Australia regions.
In addition, regarding the financing of the Epanko project, Kibaran recently reported significant progress in its discussions with the Tanzanian Government, allowing the German KfW IPEX-Bank to promote the granting of an Unbound Loan Guarantee by the German Federal Government. Given the positive results of the studies on Kwinana, Kibaran has now decided to try to obtain financing and the necessary environmental permits. A final investment decision is planned in the first half of the coming calendar year.
KNL Price at posting:
15.0¢ Sentiment: None Disclosure: Held
