ASX-listed Talga Resources Ltd.'s preliminary feasibility study for its Vittangi graphite project in Sweden estimated a pretax net present value, discounted at 8%, of US$1.06 billion, a 55% internal rate of return and a 1.5-year payback period after commissioning of the second stage, the company said May 23.
The study proposed a two-stage conventional open-pit mining operation with an on-site concentrator and a coastal anode refinery to produce about 19,000 tonnes per annum of Talnode-C during a 22-year life of mine. Talnode-C is the company's proprietary coated lithium-ion battery graphite anode material.
Capex is estimated at US$27 million for the first stage, and US$147 million for the second stage, including contingency of about 20%.
The Vittangi project is estimated to generate life of mine revenue of US$4.15 billion, and EBITDA of US$3.25 billion. Pretax net profit is estimated at US$3.13 billion.
The study is based on an ore reserve of 1.9 million tonnes at average grade of 23.5% total graphitic carbon, which is part of the global indicated resource of 10.7 Mt at 25.7% graphitic carbon.
Talga said it will now kick off the first stage's definitive feasibility study, with completion expected in the first quarter of 2020 and production also expected the same year.
The company previously agreed to work with other Germany- and Sweden-based companies to incorporate its graphene for automotive and packaging applications.