Name of the Project
Siviour graphite project.

Location
The project is located on South Australia’s Eyre Peninsula.

Client
Renascor Resources.

Project Description
The Siviour project has proven and probable reserves of 45.2-million tonnes grading 7.9% total graphitic carbon (TGC). Total mineral resources have been estimated at 80.6-million tonnes grading 7.9% TGC.

The prefeasibility study (PFS) envisages the development of one graphite deposit to produce up to 156 000 t/y of graphite concentrates over a 30-year mine life.

The Siviour PFS has investigated multiple approaches to developing the deposit, from which two have been selected as the most viable.

The immediate large-scale production scenario envisages a 1.65-million-tonne-a-year processing plant to produce 142 000 t/y of graphite concentrates for the first ten years and an average of 117 000 t/y over a 30-year mine life.

The staged-production scenario considers a reduced start-up capital, with production from a 200 000 t/y plant to produce an estimated 22 800 t/y of graphite concentrates in the first three years.

In a second stage, starting in Year 4, the larger-scale 1.65-million-tonne-a-year plant will start operations. In this scenario, Siviour would produce an average of 156 000 t/y for the first ten years of Stage 2 and an average of 129 000 t/y over the entire Stage 2 period (years 4 to 30).

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value (NPV), at a 10% discount rate, of A$666-million and an internal rate of return (IRR) of 62% in the immediate large-scale development, with a payback of 1.8 years.

In the two-stage development, an after-tax NPV, at a 10% discount rate, of A$542-million and an IRR of 47% are estimated, with a pay-back of 3.1 years for Stage 1 and 1.5 years for  Stage 2.

Value
The immediate large-scale development will cost an estimated A$132-million to implement.

The two-stage development will cost a cumulative A$160-million to implement, with Stage 1 estimated at A$39-million and Stage 2 at A$121-million.

Duration
Not stated.

Latest Developments
Renascor Resources will raise A$6.5-million to fund its Siviour project towards a decision to mine.

The company will issue more than 240.7-million shares, at 2.7c each, to professional and sophisticated investors over two tranches.

The first tranche will consist of 159.3-million shares, and will raise an initial A$4.3-million under the company’s existing placement capacity. The second tranche placement of more than 81.4-million shares, which will raise an estimated A$2.2-million, will be subject to shareholder approval.


The funds raised will be used to complete a definitive feasibility study on the Siviour graphite project and to fund the submission of a mining lease application, along with further technical assessments of the downstream options available to the Siviour project.

“We are gaining strong momentum in our push to advance Siviour into production by 2020,” Renascor MD David Christensen has said.

In addition to the share placement, Renascor will also undertake a share purchase plan to raise up to A$2-million, at the same issue price as the placement.

Christensen noted that, on completion of the placement, and assuming a fully subscribed share purchase plan, Renascor will have about A$10-million in cash reserves, which will ensure that the company could continue to advance Siviour at a rapid pace, and provide scope to explore the company’s cobalt portfolio.

Meanwhile, Renascor has signed its first offtake memorandum of understanding (MoU) for the project.

The MoU, with China’s Qingdao Chenyang Graphite, will result in Renascor’s supplying graphite concentrate from Siviour in accordance with its proposed stage development.

During Stage 1 of the operation, Renascor will supply up to 10 000 t/y of graphite concentrate to Chengyang, from the 22 800 t/y output. In Stage 2, Renascor’s production will increase to 156 000 t/y, with the offtake agreement increasing to 30 000 t/y.

The MoU has also considered cooperation between the two companies to establish pilot plant production at Chengyang’s facilities, as well as collaboration for the supply of advanced products from Siviour graphite.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Renascor Resources, tel +61 8 8363 6989, fax +61 8 8363 4989 or email info@renascor.com.au.