INTERVIEW: Australia's Volt Resources aims to spur non-China graphite mines with US refinery plan

Volt Resources Ltd. expects to incentivize graphite mine developments outside China by building a US refinery with the Department of Defense's support, the miner's Executive Chairman, Asimwe Kabunga, told Platts, part of S&P Global Energy.

The Australia-listed and headquartered company received US$5.4 million in non-dilutive funding from the department in September to develop a research and development center and graphite refinery in Alabama, which will produce high-purity and ultra-high-purity graphite.

Volt then raised A$1.5 million through a share placement Oct. 13 to complete the refinery's definitive feasibility study, due in the December quarter, and related offtake negotiations.

While natural graphite prices are gradually strengthening, there will still be a "shallow deficit over the medium term," according to a Sept. 24 analysis from S&P Global Energy Horizons.

In such a market, "a lot of deposits around the world are not producing and can't go into production because it's not viable. If we're successful [in starting up the Alabama plant], then we can help some mines to come online" by providing offtake contracts, Kabunga said.

China playbook

"China produces 76% of the global graphite mined output, with low-cost assets such as the Yunshan and Beishan mines sitting comfortably below the 50th percentile of the cost curve," an Oct. 6 Horizons report said.

"Structural deficit of mining and refining capacity outside China creates significant pricing, trade and procurement friction across the automotive value chain."

Diplomacy has thus accelerated amid China's expanded export controls on critical minerals, including graphite, in July. However, the US is still dependent on China for graphite despite imports falling during the first half of 2026, according to a Sept. 24 report from Horizons.

Considering these developments, Kabunga said Western governments will "have to play the China playbook" to build their own graphite supply chains.

Kabunga said mines outside China will need subsidies and potentially a floor price for graphite to incentivize supply, like the US did for MP Materials Corp. and what Australia's government is considering for its own critical minerals strategic reserve.

African option

Horizons's Sept. 24 analysis showed East Africa leads the potential expansion of natural graphite projects, including several in Tanzania where Volt's development-ready Bunyu mine is.

While Volt had hoped Bunyu could be one of the ex-China mines to help feed its Alabama plant, Tanzania's government canceled the mining licenses in August as it wanted the asset to be developed rapidly despite the suppressed price environment, Kabunga said.

"We already have some partners to start construction, but we couldn't start straight away because we wanted the market to be able to absorb our product," Kabunga said.

"We made that clear to the government because they wanted us to commit to start development now, but the numbers don't allow us — and you can see elsewhere that no one is developing graphite mines."

Australia-based Syrah Resources Ltd. has also been operating its Balama project in Mozambique well below capacity due to depressed prices.

Potential US premium on offer

Volt has tested concentrate from its 70%-owned Zavalievsky graphite mine in Ukraine, along with product from other African producers for its Alabama refinery, and is even testing synthetic graphite to produce a high-purity product, Kabunga said.

The latest campaign at Zavalievsky during the September quarter produced about 850 metric tons of graphite concentrate at 80%-95% total graphitic content, with about 660 mt allocated to two European contracts.

A purification circuit campaign in March at Zavalievsky produced 19.14 mt of high-purity graphite from an African mine and sold to a European customer for $3,000/metric ton in an agreement that included a 50% prepayment, Kabunga added.

The Platts CIF Northeast Asia natural flake graphite price has been consistently tracked higher than its FOB China price since both launched in 2024. Kabunga expected that once the Alabama plant is built, there could well be a premium paid above $3,000/mt in the US for refined graphite.

"We still have the capacity to expand our current production in Ukraine when the war ends, and that will continue to serve Europe, but if we do get some more production, we can also send it to the US," Kabunga said.