Renascor Resources is pleased to announce the results of the Definitive Feasibility Study (DFS) for its Siviour Graphite Project (Siviour) on South Australia’s Eyre Peninsula.
The DFS confirms Siviour’s potential as a low-cost, long-life graphite project that can achieve consistently attractive profit margins even in the current lower graphite price environment. A summary of highlights relating to the DFS is detailed below.
- World-class, low-OPEX project: DFS results confirm Siviour’s world-class potential, with a projected life of mine (LOM) operating cost of A$508 or US$355 per tonne (A$471 or US$330 per tonne over first ten years) – amongst the lowest projected operating costs globally (see Figure 12, page 27 of the announcement).
- Staged development to reduce up-front capital cost: DFS based on staged development, with average production of 80ktpa during first stage (years one to four), before expansion in year five to be funded through expected project cashflows. Average projected production in years five to ten is 144ktpa.
- Revised, current pricing: The DFS has been adjusted for current graphite market conditions with pricing from Benchmark Mineral Intelligence, resulting in a decrease from previous basket price through 2025 of 22% to A$1,149 or US$804(1).
- Robust economics: The results confirm compelling project economics, including:
o Post-tax NPV10 of A$388m or US$271m;
o Post-tax IRR of 33%;
o Start-up capital requirement of A$114m or US$79m plus a mining pre-strip of A$4m or US$3m; and
o Average EBITDA of A$83m or US$58m, EBITDA margin of 57%.
- Funding: Up to 60% of the start-up capital requirement is expected to qualify for in-principle support from Atradius, the Dutch export credit agency (ECA), subject to finalising the procurement strategy in the front-end engineering design (FEED) phase.
- Next steps: Renascor’s next immediate steps are expected to include securing binding offtake agreements, final project permitting and commencing financial due diligence.
Earlier this year, Renascor Resources announced a Mineral Lease for Siviour had been granted by the South Australian Minister for Energy and Mining. “We look forward to working with the State Government and local communities in Arno Bay and Port Lincoln as Siviour continues to progress, and thank them for their ongoing support,” said David Christensen, managing director of Renascor Resources.