The Molo Graphite Mine in southern Madagascar is set to become one of the world’s largest suppliers of flake graphite, a key ingredient for electric vehicle batteries.
NextSource Materials, the Canadian company that owns the mine, has conducted a feasibility study on the expansion of its Phase 1 production capacity to 150,000 tonnes per year of SuperFlake® graphite concentrate over a 25-year mine life.
The study proposes an additional processing plant will be built next to the current Phase 1 plant using the company’s modular build approach, which significantly reduces build time and costs compared to conventional mine construction.
According to a report by Mining Review, the project has a capital cost of $161.7 million, resulting in a pre-tax net present value of $424.1 million with an 8% discount rate.
The expansion will enhance the steady-state production rate and position NextSource as a major global supplier of flake graphite, which is in high demand for the electric vehicle battery market.
A Promising Step Towards a Clean-Energy Future
Flake graphite is a crucial component in various industries, including batteries, particularly lithium-ion batteries, due to its stable and high-energy storage capacity, making it a vital component in electric vehicle and electronic device production. As technology advances, the role of graphite in batteries is likely to become even more crucial.
Coated Spheronized Purified Graphite (CSPG) is the final form of natural graphite used by OEMs to manufacture lithium-ion batteries for electric vehicles.
The 150,000 tonnes per year production capacity was established based on discussions with automotive manufacturers, battery anode offtake partners, and anticipated demand forecasts for flake graphite conversion into SPG and CSPG.
NextSource’s president and CEO Craig Scherba said: “We are very pleased the feasibility study confirms the strong financial potential of a larger-scale operation and the significant scalability of our Molo Graphite Mine to meet the robust market demand for flake graphite for use in electric vehicle batteries.
“This is especially timely given the recent announcement of export restrictions on flake graphite and graphite anode material from China. An expansion of this magnitude will position NextSource as a major global supplier and underpin our vertical integration strategy to offer an ample and secure supply of graphite flake for our planned battery anode facility, enabling direct supply to the electric vehicle battery market.”
A Win-Win Situation for Madagascar and NextSource
The Madagascar government has granted NextSource a 40-year mining license for its Molo Graphite Project, which covers an area of 62.5 square kilometers and contains a total of 141.28 million tonnes of graphite.
With over a century of experience in the production of graphite, Madagascar is known for having some of the world’s best graphite deposits.
NextSource’s SuperFlake® graphite concentrate is a premium product that meets or exceeds the specifications of all major end-markets, including battery, refractory, and specialty graphite applications.
The company has already secured offtake agreements with several leading graphite buyers in Europe, Japan, and India, and is in advanced discussions with other potential customers.
NextSource is also committed to minimizing its environmental footprint and ensuring the sustainability of its operations. The company expects to start the construction of the Phase 2 plant in the second quarter of 2024, subject to financing and market conditions.
NextSource believes that its Molo Graphite Mine has the potential to become a world-class asset that will generate long-term value for all its stakeholders.
