Battery Minerals has signed an offtake agreement that covers 20 per cent of the first phase of production from its Montepuez graphite project in Mozambique.
The three-year agreement with United States-based graphite processor, Urbix Resources, involves up to 11,000 tonnes of graphite concentrate per year from the initial forecasted annual output from Montepuez.
In addition, Battery has signed a binding test-work term sheet and memorandum of understanding (MoU) covering toll treatment and technology commercialisation with Urbix.
Battery Minerals chairman David Flanagan said the agreement marked another key milestone along the path to project development and cash flow.
“The deal is pivotal for three reasons: it reflects the quality of the Montepuez product, it highlights the outstanding future of the project and it underpins the sale of significant share of our forecast production,” Flanagan said.
“With our $20 million capital raising recently completed, engineering studies progressing rapidly and now binding sales agreements in place, we are firmly on track to start construction in the next quarter and be commissioning in December 2018.”
Flanagan said Battery would also be working with Urbix to develop and market the products to sell into the US battery market.
“Ongoing market development will include optimising development of a spherical graphite for use as anode material in lithium-ion batteries as part of an international marketing strategy.”
Urbix will have a right to bid for up to 6000 tonnes per annum of additional production when the Montepuez project expands. The US company will also be able to bid for a further 6000 tonnes a year when Battery’s Balama Central graphite project comes on stream.