Syrah Resources is on track to meet the lower end of its production guidance at the Balama graphite operation in Mozambique.
The company began commercial production at Balama at the start of 2019, overcoming fire-related issues in its journey to produce 33,000 tonnes of graphite in the December 2018 quarter.
Syrah expects to produce around 45,000 tonnes of of graphite during the first quarter of 2019, which is squarely in line with the low end of Syrah’s guidance target of 45,000–50,000 tonnes. The company’s full year target stands at 250,000 tonnes.
Conversely, the average graphite price of around $US460-470 ($649-663) per tonne is slightly lower than the anticipated guidance of $US500-600 per tonne.
Syrah stated its cash position still remained on track at around $55-57 million, against a $57 million guidance, for the first quarter of 2019. It anticipates its sales volume to slightly exceed production volume during the quarter.
The company predicts its cash reserves to fall in the second quarter due to increased capital expenditure at its Louisiana graphite processing plant and the continued ramp up of Balama.
The Balama mine is one of the world’s largest natural graphite deposits, containing an estimated graphite resource in excess of 1.19 billion tonnes over a 50-year mine life.