Syrah Resources highlights positive testwork for Balama graphite
Syrah Resources (ASX: SYR)
has produced a high grade 96.6% graphite concentrate through simple
processing of a bulk sample from its highly prospective Balama East
graphite and vanadium project in Mozambique.
The recovery of the
concentrate, 25% of which was abundant coarse to very coarse material,
was achieved by crushing to 2mm followed by four stages of floatation.
In separate tests, a potential customer achieved a 99.3% grade using simple flotation processes
Metallurgical
tests have also shown that Balama graphite can be easily upgraded to
99.9% total graphitic content using chemical wash operating at low
temperatures.
Balama graphite has also been shown to be
expandable based on customer testwork and hence can be sold into the
expandable graphite market, which is about 40,000 tonnes per annum.
It has been micronized down to 1 micron size and can be sold in the micronized graphite market.
Coarse Flake Graphite
Zones of coarse flake
graphite have been identified across the Balama deposit. These zones are
mainly associated with rock units XGS2 and XGS4.
These zones were identified during drilling at Balama East and West and mapped at surface at Balama West and East.
Syrah believes the heat from the granite intrusion at Balama East has upgraded significantly the flake size and flake purity.
XGS2
has been mapped around the perimeter of the granite. Syrah believes
that XGS 2 continues for a further 3.5 kilometres to the east and likely
connects between Balama East and Balama West in the undrilled 3
kilometre area between the two zones.
In addition there are zones of coarse grained graphite in the XGS1 unit at both Balama West and Balama East.
Syrah
added that while the market perception that very coarse flake graphite
is the desired product from a buyer’s perspective, the reality is that
the graphite market is relatively evenly divided by buyers requiring
coarse, medium and fine flake graphite.
Different size fractions sell at different prices. Many buyers choose to use finer flake due to the lower price.
The
company has graphite that ranges in size from jumbo to very fine and
its assemblage broadly represents the market demand across the different
categories of flake graphite.
High Purity Graphite
Syrah
also debunked the belief that it is difficult to upgrade graphite to a
99.9%TGC concentrate using chemical wash, noting that graphite is inert
whereas certain acids can dissolve almost all other minerals impurities.
The
consumables required for the purification process has been found to be
very low due to the composition of the impurities combined with the
graphite concentrate being very high grade.
It added that while
the market for high purity natural graphite is quite small – at less
than 20,000 tonnes per annum, it could sell for up to US$5,000 per
tonne.
Expandable Graphite
Based on
customer testwork, Balama graphite can be expanded. The potential
customer noted that the Balama graphite was superior due to expansion
qualities being 20% greater than their existing supplies of expandable
graphite.
Expanded graphite has use in areas such as fire
retardants, graphite foil, sealing material and others. The market for
expandable graphite is relatively small market (about 40,000 tonnes per
annum) but it sells for US$1,500 to US$5,000 per tonne.
Micronized Graphite Powder
Syrah’s
testwork has also shown that Balama graphite can be micronized down to
0.25 micron size material through a proprietary milling process.
Given
the high purity of Balama graphite, the micronised powder can be used
in a number of specialised applications such as carbon brushes, lamp
carbon, specific lubricants and possibly as a substitute for some
battery graphite applications.
High quality (low sulphur content) micronised graphite can sell for up to $3,000 per tonne.
Preliminary
testwork is ongoing as to the suitability of Balama graphite in battery
anode (spherical graphite) for lithium ion battery applications.
Balama Graphite Project
Syrah
was in December granted a 25 year Mining Licence for the project and
expects to start construction after the wet season ends in April 2014.
It
recently defined a Measured Resource of 11.6 million tonnes grading
19.9%TGC and 0.4% V2O5 at the Ativa Zone of Balama West that is defined
to be sufficient for 11 to 12 years of production.
The
company has indicated that Balama could become a mine well before the
first hole was drilled given the extremely high grades of graphite and
excellent grades of vanadium.
Analysis
The
encouraging metallurgical testwork carried out on samples from Balama
East is another feather in Syrah’s cap as it moves towards development
of its Balama Graphite and Vanadium Project.
These show the suitability of Balama graphite to meet multiple graphite markets.
Syrah
has been in discussions with potential debt financiers and off-take
partners for several months with an outcome expected in the first
quarter of 2014.
The company said it anticipates debt financing
the remaining amount required to develop the project, and is confident
that the project can be developed for under US$100 million.
Syrah is also in a position to begin construction of Balama as soon as the wet season ends in about April 2014.
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