London-listed Blencowe Resources is moving to complete the prefeasibility study (PFS) at its priority Orom-Cross graphite project, in Uganda, by midyear as a precursor to implementing first graphite production from 2023.

Orom-Cross is a potentially world-class graphite project – both in terms of size and end-product quality – with a high component of more valuable larger coarse flakes within the deposit. A 21-year mining licence for the project was issued by the Ugandan government in 2019 following extensive historical work on the deposit.

The project holds an estimated two-billion to three-billion tonnes of graphite, of which the first 20 years’ life of mine has already been drilled out. However, since the deposit is so vast, this represents less than 1% of the estimated graphite within the tenements. 

Owing to the shallow graphite, Blencowe aims to mine to a maximum depth of 25 m, which will translate to low-cost mining from a free dig opencut operation.

"Blencowe is moving quickly. Graphite demand is forecast to expand considerably from 2025 onwards and Blencowe wants to be positioned by then not only as a producer but also ready and able to expand quickly and cost-effectively to take advantage of growing worldwide demand,” said Blencowe executive chairperson Cameron Pearce on March 8.

The preliminary economic assessment (PEA) for Orom-Cross, which was completed in September last year, provided the basis for a large-scale 75 000 t/y graphite operation. However Blencowe has indicated that it will scale this down in the early years to allow for a lower risk, lower capital expenditure start-up, producing about 25 000 t/y of high-grade concentrate. 

The company said in a statement that provision would be made for ramping the plant size and production rate up quickly over the first ten years to accommodate what was expected to be a surge in demand for flake graphite – predominantly for use within lithium-ion batteries for electric vehicles.

Blencowe said it would work closely with its specialist technical partner Battery Limits to deliver a low-cost mining operation that would place Orom-Cross in the lowest percentile of global graphite producers.

“We have come a long way in the two years since we acquired Orom-Cross, and the upswing in demand that we are seeing for the products we will produce has fully justified our strategy,” Pearce noted.

Currently, Blencowe is awaiting the revised Joint Ore Reserves Committee (Jorc) resource estimate for the project, based on the extensive infill drilling programme from 2021, and its geological partner Minrom will provide this update shortly.

This Jorc-compliant resource is expected to increment the 16-million tonnes at 6% total graphite content that was announced last year and provide additional tonnes that can be used for a much longer mine life than previously indicated in the PEA. 

Meanwhile, work is being completed in parallel on Phase 3 metallurgical test work to refine the end products that will be delivered as concentrate from Orom-Cross. Blencowe said these results were expected soon. 

Phase 2 metallurgical test work indicated a high-quality array of end products that the company believed would be sought after in the market, while Phase 3 testing was expected to underline this further by confirming the marketable characteristics of the different mesh size products and producing concentrates for consumer testing prior to pilot plant production .

One of the key additions within the PFS was the expectation that Blencowe would deliver a pilot plant by 2023 to produce small quantities of these same end products to prequalify sales into end users. The company said this was a necessary and integral step to sell higher quantities of graphite concentrate from 2025 onwards, when the main plant was expected to be commissioned.

Blencowe added that it was looking at all options to deliver green graphite products through a project that leaned heavily on renewable energy and other sustainable components. This was seen as a very important objective within the PFS and the strategy moving forward.

All other areas within the PFS are going to plan, with work under way on all key areas including infrastructure, energy, roads, water, tailings, logistics, sales and marketing, plus plant and camp design.

“Events in Eastern Europe over the past month have underlined the importance of supply chain diversification and we aim to provide a high quality alternative supply route for a key battery metal, within a low risk location,” Pearce said.

He added that the company had also recently added a highly prospective nickel sulphide project into the company’s portfolio.

“The next important step will be to provide the market with a clear picture of what our production plans ahead look like, including prequalification of sales into end-users over a longer period so they can all fully understand the characteristics of the products we will deliver prior to expansion into full production mode," Pearce concluded.