Volt Resources Ltd (ASX:VRC) has provided advanced working capital to recommence graphite production from the Zavalievsky Graphite (ZG) operations in Ukraine, which operated for 11 continuous days during November.
ZG produced 561 tonnes of graphite product during this period, averaging about 51 tonnes of product per day. Overall, ZG mined a total of 37,389 tonnes at an average grade of 6.12% carbon.
European graphite prices have risen recently due to a downturn in Chinese graphite production, global supply chain disruptions and increased shipping costs.
Volt and ZG have been renegotiating sales prices with European customers to reflect these high prices resulting from supply squeezes.
Volt had been delaying the provision of capital to ZG due to concerns with the company’s charter conflicting with VRC’s shareholder, board and executive management interests.
ZG’s charter prevented the appointment of a Volt selected CEO to manage the group business and was also restricting the ability to appoint a Volt selected chief financial officer.
The above changes were implemented in early November, leading Volt to advance the working capital to ZG in mid-November 2021, allowing the business to resume operations and achieve a solid mining and processing performance over 11 days.
Zavalievsky operational results
Average ore mined was above nameplate ore production, directed at providing sufficient ore stocks for processing following the resumption of operations. Waste mined was below the level required for appropriate open pit mine development.
ZG is evaluating the potential to contract mining groups for waste removal because of the increased material movement required in the next 12 months.
To date ZG has conducted mining operations on an owner-operated basis requiring material investment in mining equipment and support facilities. Contract mining for ore production is also being evaluated.
ZG has begun the process of converting its current resource information to meet the requirements of a JORC-compliant resource, which along with a robust ore reserve and an optimised mine plan and schedule, will be core to the sustainability of ZG and VRC’s business.
About Volt Resources and ZG
Volt Resources is a graphite producer/developer and gold exploration company listed on the Australian Stock Exchange. Volt has a 70% controlling interest in the Zavalievsky Graphite business in Ukraine.
Zavalievsky is in close proximity to key markets with significant developments in lithium-ion battery (LIB) facilities planned to service the European based car makers and renewable energy sector.
ZG benefits from an existing customer base and graphite product supply chains based on excellent transport infrastructure covering road, rail, river and sea freight combined with reliable grid power, ample potable groundwater supply and good communications.
ZG has current plans to install a processing plant and equipment in order to commence production of spheronised purified graphite (SPG) for the European LIB market.