Syrah Resources Signs 80,000 TPA Binding Offtake Agreement With Chalieco
Syrah Resources (Syrah) is pleased to announce that it has secured a three year Binding Offtake Agreement with China Aluminium International Engineering Corporation Limited (Chalieco). Chalieco is an affiliate company of Aluminum Corporation of China Limited (Chinalco), the world’s second largest alumina producer, the third largest primary aluminium provider and the fifth largest fabricated aluminium producer.
Chalieco will purchase 80,000 tonnes of graphite per annum at various size fractions (+50, +80, +100 and +150 US mesh) with exclusive distribution rights in China and Hong Kong (Territory) only. It will also source product exclusively from Syrah. Chalieco strongly believes that graphite and its downstream products will be very important raw materials for both modern and traditional industries such as electric automobiles and steel. Based on Chalieco’s knowledge, the size of the Balama resource and the high quality of its large flake graphite ranks it as one of the top global graphite deposits “ever known to man.”
Prices will be negotiated quarterly between Syrah and Chalieco based on market prices which have prevailed in the Territory during the preceding three months. Syrah believes that 2014 graphite prices represents a cyclical low and prices are expected to strengthen over the next five years due to ongoing Chinese supply pressures and increased flake graphite demand from electric vehicles and battery storage applications.
Based on forecast prices from Benchmark Minerals, the forecast weighted average basket price of this Binding Offtake Agreement is expected to be USD 1,100 to USD 1,600 per tonne from 2015 to 2019. Ongoing negotiations with other potential offtake partners around the world and further announcements around these will be made in the near future.
Contact
Syrah Resources
Tolga Kumova
Office contact - +61 3 9670 7264
Mobile contact - +61 421 707 155
t.kumova@syrahresources.com.au