Quantum Graphite (ASX: QGL) has completed a detailed airborne electromagnetic (EM) survey over its Uley tenure on South Australia’s Eyre Peninsula. The company is on a quest to boost its current Uley 2 resource of 6.3 million tonnes at a respectable 11.1 per cent total graphitic carbon (TGC) for an inventory of 697,000 tonnes of the critical battery mineral.
Leading geophysical provider UTS Geophysics has just touched down after covering 900 line-kilometres, taking in the full extent of Quantum’s tenure.
The airborne EM survey followed a ground-based geophysical survey conducted late last year over the Uley 2 and Uley 3 deposits designed to reconcile geological data collected from the last six years of diamond drilling.
Results from the two surveys will provide the cornerstone for future exploration where the company says it is looking to etch out additional district-wide targets and extend its known resources.
We know we are seeing the tip of the iceberg at Uley 2 and Uley 3 and the survey data will provide the granular information needed for the upcoming drill program and ongoing resource development. Recent market developments have impressed upon us the urgency of expediting the resource development that will underpin multi-decade operations at Uley.
Quantum’s managing director Sal Catalano
Quantum capped off an intriguing year last year in the graphite market which saw China announce export restrictions fuelled by the intensifying US-China tech war, by delivering an update to its 2019 definitive feasibility study.
The company outlined an internal rate of return of almost 50 per cent and a net present value (NPV) of more than $497 million.
The latest data follows an independent assessment by Lycopodium Minerals that identified doubling the project’s mill throughput up to 1.2 million tonnes a year would lift production from 55,000 dry metric tonnes of flake graphite up to a maximum of 100,000 dry metric tonnes.
Quantum says it expects a life of mine revenue of more than $1.28 billion with annual operating costs of $26 million per year, or $21.615 per tonne. The figures outline the financial impact of Lycopodium’s value engineering assessment.
Quantum is currently putting the finishing touches on a 10,000 metre reverse circulation drilling program which it believes has the potential to unlock a significant upgrade to the Uley 2 and Uley 3 resources and ensure suitable extensions to its projected mine life.
The company has achieved flake purity grades of 99.99 per cent graphitic carbon following thermal purification results from its final phase of testing on samples from Uley 2 completed in early 2023. The flake was treated at a thermal temperature of 2850°C to achieve the impressive purity levels using a testwork program conducted by Germany’s Institute of Nonferrous Metallurgy and Purest Materials, ProTherm Systems and Sunlands Power.
Together with its joint venture partner Sunlands Co, the duo are working to develop thermal energy storage cells using natural flake graphite after launching independent testwork to accelerate the commercialisation of the technology. Management says the devices could provide long-duration energy solutions and play an integral role in delivering stable and flexible energy to grids dependent on renewable power.
China accounts for more than 90 per cent of global production of high purity graphite currently, a critical material used in almost all electric car batteries, as well as semiconductors and nuclear reactors. The export restrictions are not a wholesale ban but exert a clear stronghold on bilateral relationships with countries at the forefront of the electric revolution, including the US, who is somewhat dependent on China for its raw materials.
As the Western world seeks to diversify its graphite supply chain, Quantum is placing itself in poll position to take advantage of the paradigm shift in the graphite market.
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