Triton Minerals (ASX: TON) has secured its first binding offtake agreement for Ancuabe graphite, turning its term sheet with China’s Qingdao Tianshengda Graphite into a five-year deal to supply its high-quality Mozambique flake at market prices.
The binding, conditional offtake deal with Tianshengda, announced today, includes an option to supply the large and jumbo flake for an extra five years.
The milestone follows the new partners’ initial term sheet agreement in February 2018 for the deal.
Tianshengda is an integrated graphite processor and distributor across China with an annual capacity of 30,000 tonnes to 40,000t of value-add graphite products a year.
Triton will supply up to 16,000t a year of Ancuabe graphite concentrate from the site 60km west of Pemba in northern Mozambique to the nearest port to Tianshengda, which is based in Laiki City, in China’s Shandong Province.
Under the agreement, Triton is contracted to deliver at least 10,000t a year.
The company achieved full ownership of Ancuabe in February 2018 after reporting in November 2017 resources at its T12 and T16 deposits had increased 59% to 44.4 million tonnes grading 6.6% total graphite carbon for 2.9mt contained graphite.
Triton managing director Peter Canterbury said the offtake agreement was a “Securing this binding agreement and becoming part of the supply chain for Tianshengda illustrates the strong demand for premium Ancuabe graphite concentrate, growth of the expandable graphite market in China, and vision of Chinese graphite producers to diversify their supply base in response to domestic shortages and legislative changes,” he said. “These factors underscore the value of the Ancuabe graphite project.”
Advancing Ancuabe to development
Triton must make an investment decision and obtain Mozambique government approvals and mining concession to meet Tianshengda’s conditions for the deal.
The West Australian company must also construct the mine and its infrastructure for the binding agreement to go ahead.
Triton managing director Mr Canterbury today affirmed the A$60.4 million company’s development plan includes first production at Ancuabe in the second half of 2019.