West Perth-based EcoGraf is one of two graphite companies set to receive a major loan through the federal government’s $2 billion critical minerals initiative.
EcoGraf this morning announced the government, through Export Finance Australia, had conditionally approved a loan of up to $54 million to support a planned expansion of the company’s graphite processing facility under construction in Rockingham.
The $98 million project has already been endorsed by the federal government, achieving major project status in March 2021. It's also received lead agency status from the state government.
The plant will be the first of its kind outside China, with the processed graphite suitable for lithium-ion batteries used in electric vehicles.
EcoGraf expects to process an initial 5,000 tonnes of graphite each year, sourced from the company's Epanko mine in Tanzania, followed by a ramp-up to 20,000tpa.
The facility is being built on a 6.7-hectare site within the Rockingham Strategic Industrial Area, with EcoGraf having signed an agreement with landowner DevelopmentWA in September 2020.
EcoGraf is considering building a second processing facility in Europe where it will also target 20,000tpa upon completion.
The company said the proposed loan was subject to a number of conditions, but that it had appointed financial advisers to coordinate the remaining due dilligence activities with EFA.
Its shares closed up 7.8 per cent this afternoon to trade at 69 cents.
The EFA has also conditionally approved a loan to Adelaide-based Renascor Resources, with up to $185 million to fund development of the company’s Siviour graphite project in South Australia.
The loans are the first to be announced as part of the federal government’s $2 billion critical minerals facility, established in September.
Minister for Trade, Tourism and Investment Dan Tehan said both graphite projects will promote Australia as a trusted supplier of critical minerals.
“At a time of booming global demand for smartphones, electric vehicles and other technologies this commitment from the Australian Government positions Australia strongly into the future in the critical minerals sector,” he said.
Minister for Resources and Water Keith Pitt said the loans will pay long-term dividends to the national economy.
“The potential of the critical minerals sector is enormous, and these loans will support two significant projects that will expand Australia's footprint and reputation in this rapidly growing industry,” he said.
“It will build on a resources sector that already provides over 365,000 direct jobs for Australians and is forecast to contribute a record $379 billion in exports this financial year.”
