Water Supply - Approval Construction of Pipeline from Chipembe Dam

PatientMan questioned whether water supply was an issue for another graphite company - Post #:22686347 - it raised a question in my mind about SYR - I don't recall SYR advising they had received approval to construct the "planned" pipeline from Chipembe Dam to Balama - perhaps I missed but they normally put out a PR to announce these types of important approvals.  

We know SYR currently holds a water licence for the Balama Project (due to expire in November 2019, subject to renewal) and I believe it was extended from 5 - 10 years.  

The December Quarterly mentioned ....
"Water licence for extraction from Chipembe Dam has been extended from 5 to 10 years with construction of pipeline to commence in February 2017. All equipment is on site ready for installation"

September Quarterly.....
"Water pipeline – pipe is on site and ready for installation to commence after the installation contract is awarded"

August PR....
"SNC-Lavalin awarded construction services contract - will provide structural mechanical and piping construction services for the processing plant, including piping supply and platework"

Not sure if this includes the pipeline from the dam to Balama ,but still does not answer the question re government approvals.


The licence may have been extended and they may be ready to commence construction but have they actually received approval to commence construction?   Perhaps PatientMan could look into and give us his thoughts.

PatienMan was also concerned about drought conditions in relation to the other competitor - I recall this was also a risk mentioned by SYR.  

The following is an extract taken from SYR's Equity Capital Raising Presentation in June 2016.  

Water sources

Any restrictions on Syrah’s ability to access water may adversely impact the costs, production levels and financial performance of its operations. There is no guarantee that there will be sufficient future rainfall to support Syrah’s future water demands in relation to its sites and operations or that access to water will otherwise remain uninterrupted. Any interruption to water access could adversely affect production and Syrah’s ability to develop or expand projects and operations in the future. In addition, there can be no assurance that Syrah will be able to obtain alternative water sources on commercially reasonable terms or at all in the event of prolonged drought conditions or other interruptions to existing water access arrangements. Syrah currently holds a water licence for the Balama Project (due to expire in November 2019, subject to renewal), in respect of a river that flows through the Chipembe Dam. Syrah has assessed that the optimal means of supplying water to the Balama Project is to construct a pipeline between the project and the Chipembe Dam. Syrah has sought approval to construct such a pipeline and is currently in discussions with relevant government authorities in Mozambique. If the necessary approval is not obtained in a timely manner, Syrah will need to explore alternative means of water supply. This could result in project delays and/or additional costs which could delay ramp up and otherwise adversely impact Syrah’s operational and financial performance.