A Front End Engineering and Design (FEED) study has confirmed the financial viability of International Graphite Ltd’s proposed micronising facility in Collie, Western Australia.
The flagship Collie facility is a key plank in the company’s broader strategy to develop value-added industrial and battery anode graphite processing capabilities.
“We see the Collie development as a first step in the build-out of our Australian and international downstream industrial facilities,” managing director and CEO Andrew Worland said.
The study looked at the technical, economic, and regulatory framework for developing a 4,000-tonne-per-year (t/y) graphite micronising plant, with an option to expand production to 7,500 t/y.
Highlights of the study
Key findings of the FEED study include:
- initial production capacity of around 4,000 t/y of micronised graphite;
- a capital cost estimate of A$6.3 million, including infrastructure to support future expansion;
- average annual sales revenue projected at A$14.1 million;
- expansion option to increase production to 7,500 t/y, with additional capital cost of A$1.7 million;
- project supported by existing government grants totalling A$6 million; and
- targeted commencement of operations by late 2026.
The study estimates total revenue of A$282.3 million over 20 years for the base case and A$560.5 million for the expanded capacity.
The net present value (NPV) for the initial plant is projected at A$25.8 million (pre-tax) with an internal rate of return (IRR) of 43%, increasing to A$74.1 million and 72% respectively under the expansion scenario.
Project development and strategy
The capital cost estimate includes provisions for building design, civil works and infrastructure upgrades to facilitate a low-cost expansion.
The project is expected to leverage the existing Collie Graphite Processing and Research and Development Facility, established in 2022, to streamline commercial-scale production.
The company anticipates that early cash flow from micronised graphite production will help finance the development of its Springdale Graphite Project and strengthen its mine-to-market strategy.
The FEED study financials are based on independent market analysis, assuming a production mix of 95% and 99% purity graphite with particle sizes ranging from 15 to 45 microns.
The final production strategy, including ramp-up schedules and product specifications, will be adapted to prevailing market conditions and customer requirements at the time of commissioning.
Cost estimates and funding
The capital cost estimate has been developed as a Class 3 estimate, with a ±15% accuracy range, making it suitable for funding decisions and procurement planning.
The estimate includes site preparation, civil works, equipment procurement, utilities and commissioning costs, reflecting current market conditions and material and labour costs.
Revenue projections remain highly sensitive to key variables, including production ramp-up rates, product pricing, and feedstock costs.
The company expects a significant reduction in feedstock expenses once graphite concentrates from the Springdale Graphite Project are integrated into the supply chain, further enhancing project economics.
International Graphite continues to refine cost assumptions as it moves towards final engineering and procurement stages, ensuring the project remains on track for its targeted operational launch by late 2026.
“The economics for the Collie Micronising Facility are strong,” Worland said.
“Successful implementation and progressive expansion option would rank International Graphite as an international force in the industrial graphite market.
“We believe the key to advancing graphite projects is through the control of value-adding industrial and battery anode downstream processing facilities.
“Our goal is to develop markets and generate early cashflow that will assist in the financing of our Springdale Graphite Project and mine to market strategy.”