Black Rock Mining (ASX:BKT) has signed a partnering memorandum of understanding with global lithium-ion battery market participant, Meiwa Corporation (TYO:8103) of Japan.
The MOU establishes a framework for the organisations to determine the most amenable products to ensure commercial viability of Black Rock’s Mahenge Graphite Project and the basis of a long-term commercial relationship.
Meiwa Corporation participates as a joint venture partner in a spherical graphite production facility in Shandong Province, China.
Steve Tambanis, managing director, commented: “The company looks forward to working with Meiwa Corporation, a highly experienced and globally recognised participant in the lithium ion battery supply chain.
“The MOU with a Meiwa corporation is a significant step in our strategy to produce high purity graphite for the emerging global lithium-ion battery market and reinforces the quality of the company’s flagship Mahenge Graphite Project.”
Background
Black Rock owns graphite tenure in the Mahenge region, Tanzania, a country that hosts world‐class graphite mineralisation.
The Mahenge project resource is comprised of three deposits – Ulanzi, Epanko and Cascade and is one of the largest JORC graphite resources globally.
During December 2016, the company reported a substantial increase in its Cascades resource estimate to 53 million tonnes at 8.3% total graphitic content (TGC) including a high grade portion of 14 million tonnes at 12.1% TGC.
This increased its total resource to 203 million tonnes at 7.8% TGC.
This high grade portion is expected to have low strip ratios and similar metallurgical characteristics as Ulanzi, which should deliver a high purity concentrates from simple flotation circuit processing.
It is expected to deliver the Mahenge graphite project industry leading low capital and operating costs.
Coupled with this development, the company has also decided to plan for a much larger mine to be delivered in stages.
Key Terms of the MOU
The memorandum of understanding (MOU) establishes a framework for the organisations to work together to:
- Determine appropriate development routes, sales and marketing strategies;
- Evaluate the commercial viability of a long-term business relationship including the appropriate products to produce, market opportunities and other items relevant to the construction and operation of the Mahenge Graphite Mine; and
- Discuss a variety of pricing options that would provide for the sale of products by Black Rock to
Meiwa Corporation, including a sales and marketing agreement, a supply agreement or an option agreement once the project has proven its feasibility.
Meiwa Corporation
Meiwa Corporation of Japan is a listed Japanese trading house that was established in 1947.
It is involved in numerous businesses, including chemicals, plastics, construction materials, fuel, machinery and metals.
In 2010 Meiwa Corporation became a joint venture partner in a spherical graphite production facility in Shandong Province, China.
Analysis
This MOU builds on test work that has been conducted on Mahenge’s graphite, which to date has delivered industry leading results.
Test results suggest Mahenge’s graphite has the potential to enable battery manufacturers to produce more stable lithium-ion batteries at a lower cost with a longer cycle life.
Therefore the potential to displace synthetic graphite in lithium-ion batteries once performance, cost advantages and the ability to consistently supply spherical graphite for long term production can be demonstrated.
Recently Black Rock’s chairman, Stephen Copulos, increased his stake to 24.63% from 22.76% in the company.