Australia to begin graphite production in SA

Australia’s only operating graphite mine has reopened today for the first time since its closure in 1993.

The Uley Mine near Port Lincoln, South Australia, is operated by Valence Industries who have been developing the mine and stockpiling graphite ready for processing.

The mine was in production intermittently since discovery of the mineral there in the 1920s, but was forced to close in 1993 after price slumps were caused by Chinese oversupply of the global graphite market.

With processing plant now fully refurbished and commissioned, Phase 1 of production will process 10,900 tonnes of stockpiled graphite left behind by the 1993 closure.

This will be followed by processing of newly mined graphite from Uley Pit 2.

Prior to the closure Uley produced approximately 14,000 tonnes of graphite per year, but now the plant will be able to produce 29,000 tonnes per year to meet demands set by several Memoranda of Understanding over the next two to three years.

The mine is currently estimated to contain 360,000 tonnes of graphite, and employs 30 people per year, although 60 more will be hired in 2015 as Phase 2 comes online, bringing the total to 90 employees.

A revised feasibility study for Phase 2 is expected by the end of the year, which will include a new open pit and a new processing plant worth $35 million to construct, which will ramp total production up to 50,000 tonnes per year.

Valence has continued exploration in the area with success, finding grades of more than 60 per cent Total Graphitic Content near the surface.

Valence has trademarked the brands ‘Uley Graphite’ and ‘Arterial Flake’.

Demand for graphite looks set to surge over the coming years, as the mineral sees more use as batteries for electric cars, and in product ion of the high-tech material graphene.

Valence Industries managing director Christopher Darby said the year 2014 had been a transformative year for the company.

“The Company listed on the ASX earlier this year; the refurbishment of Uley is complete and we are on the cusp of restarting production at this historic site, which when it was in full production supplied high quality material to meet the world’s graphite needs,” he said.

“Graphite is globally recognised as a critical commodity, with applications in a wide variety of products such as lithium‐ion batteries and consumer electronics that are vital to the modern world.

“Of particular importance for Valence is the robust demand for high purity flake graphite which is a necessary component in new technologies and can command premium prices.

“Recent exploration has proven that our Uley Graphite has a material amount of high quality flake graphite, particularly with the discovery of the Arterial Flake graphite, and the Company is well positioned to exploit this as it prepares to embark on the development of Phase II of Uley.”

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