Beowulf and its wholly owned Finnish subsidiary Grafintec Oy, provided an update for the Graphite Anode Materials Plant in the GigaVaasa area.
Ed Bowie, Chief Executive Officer of Beowulf, commented:
“Given the fast-moving nature of the global graphite market and the increasing need for supply-chain security, the Company has updated its development strategy for GAMP, fast-tracking the development of the full processing facility. This updated strategy builds on the PFS completed last year and, through capturing more of the value-chain, is expected to improve the already excellent economics. We look forward to updating the market with our ongoing test-work results and progress with the PFS in due course.”
Rasmus Blomqvist, Managing Director of Grafintec, commented:
“I am very pleased with the progress we have made over the last 12 months. While the timeline for the Environmental Impact Assessment and PFS work has been extended due to Grafintec’s change in strategy, I am pleased that the overall timeline to production will remain the same. Introducing the full process chain from the start of production will significantly reduce our raw-materials supply risk and is likely to improve the project economics.”
GAMP Strategy Update
The development plan for GAMP, announced on 26th September 2023, considered a three-phase development with the initial phase focused on the final processing stage in the production of graphite anode materials, namely the Coating stage. The plan for Phase 1 envisaged the import of spherical graphite (“SPG”) from third parties, coating this material to produce 20,000 tonnes of anode material per year of Coated Spherical Graphite (“CSPG”) for sale to anode manufacturers. Phase 2 of the development plan was to incorporate the full process comprising three stages into the plant. Graphite concentrate would be imported from third parties and this would then be Spheronised, Purified and Coated, producing 20,000 tonnes per year of CSPG. Phase 3 of the original plan envisaged an expansion of production to 60,000 tonnes per year of product.
The updated strategy for GAMP is to build the three-stage processing plant at the outset comprising Spheronisation, Purification and Coating effectively bypassing the previous Phase 1. Graphite concentrate feed will initially be sourced from third-party mines and the Company has letters of intent for this supply. The GAMP will then process this material and produce 20,000 tonnes of CSPG per year for sale to anode manufacturers for the battery industry. A future expansion to 60,000 tonnes per year of CSPG is then planned.
Rationale for the Update in Strategy
The update in the Company’s strategy has been driven by two principal factors. Firstly, the full process will capture a larger portion of the value chain. While the full process will have a higher initial capital cost than the Coating stage, which was estimated at US$117 million in the PFS released in July 2023, the full process is expected to be very value accretive, based on the development studies of comparable projects in the market. The updated GAMP plan is therefore also expected to be more attractive for potential funding partners.
Secondly, the full process provides greater supply chain security. China retains a significant market share in the production of graphite materials for anodes and, in particular, controls approximately 99% of global spherical graphite refining capacity. In December 2023, the Chinese government announced export controls on graphite products. While the full impact of these controls is not yet known, they do highlight the current dependence of the global battery industry on China. Graphite concentrate sourced from mines outside of China is, by contrast, more readily available and there are multiple potential sources. In line with the objectives of the EU’s Critical Raw Materials Act, the Company’s updated strategy seeks to mitigate the key supply chain risks.
Revised Development Plan
The Technical workstream comprises the following:
The updated PFS technical workstream builds on the PFS completed for the Coating plant released in July 2023 which demonstrated robust preliminary economics with a post-tax NPV8 of US$242 million and a post-tax IRR of 39%.
Optimisation test-work and techno-economic studies of the full process are ongoing including state-of-the-art Spheronisation and chemical Purification technologies with our technology partner Dorfner Anzaplan GmbH (“Anzaplan”).
On the conclusion of the PFS by end of 2024, the Definitive Feasibility Study (“DFS”) will be launched.
The DFS is expected to take six to nine months to complete, and during this period, test-work will continue, generating product for battery manufacturers to complete pre-qualification testing.
The ongoing Environmental workstream comprises the following:
As previously announced, Grafintec has appointed Finnish Engineering Consultancy AFRY Finland Oy (“AFRY”) to undertake the Environmental Impact Assessment (“EIA”). The EIA will reflect the updated scope of the development plan and is aimed to be completed by the end of 2024.
Following its submission, the local authority, the Centre for Economic Development, Transport and the Environment (“ELY”), will review the EIA before making a statement of their findings. The review process by ELY is anticipated to take approximately three months.
Following completion and submission of the EIA, work will commence towards the Environmental Permit. The preparation of the Environmental Permit application, which will take approximately six months to compile, can partly be done as a parallel workstream with the EIA with the aim to speed-up the overall process.
Source: London Stock Exchange
