VIDEO: Graphex Mining Ltd - Offtake and Financing on the Verge of Completion for Graphite Developer

Perth - Graphex Mining Ltd. (ASX:GPX) is developing the Chilalo graphite project in Tanzania. Unlike the majority of other graphite developers that have targeted the spherical graphite sector, Graphex plans to sell concentrate from Chilalo into the expandable graphite market.

Expandable graphite is used predominately in flame retardant building materials. Recent changes in Chinese building regulations have mandated the use of flame retardant building materials in all future constructions, meaning the demand for expandable graphite looks set for significant growth.

The Chilalo project is one of the world's premier expandable graphite projects, with an expansion ratio six times the rate of Chinese projects and around three times the rate of other African development projects.

Analyst Comment: Offtake in our opinion is the most critical aspect prior to the development of any commodity that is not traded on a designated metal exchange (such as graphite). Without offtake there is no guarantee of a buyer for the product, which in turn makes project financing difficult.

Graphex is on the verge of securing offtake with two highly reputable Chinese State owned enterprises (CNBM & China Gold) which would eliminates this risk. Attracting partners of this size and calibre also highlights the quality and significance's of the Chilalo Project.

With the offtake partner also likely to become a Joint Venture partner in the project (anticipated 50% acquisition at the project level), Graphex will essentially be fully funded once offtake is finalised. Given this we expect a significant re-rating in Graphex's share price once the binding offtake terms are finalised in early 2017.

The information in this email should not be the only trigger for your investment decision. We strongly recommend you seek professional financial advice whenever making financial investment decisions.

Valuation: We initiated coverage on Graphex with a valuation of $1.16 / share (share price $0.34 / share). This valuation assumes a 50% interest in the project and a 12% discount rate. Full details of our valuation can be accessed by clicking on the link below.

As always, we present our analysis differently as it is shown through a series of videos. This allows us to explain:

- A detailed review of our valuation analysis which highlights our key assumptions and sensitivities;

- Investment and risk analysis, which highlights both upside and downside factors investors should be aware of before making an investment decision;

- Review of the graphite sector, including uses, supply & demand as well as pricing;

- Site trip to the Chilalo project in Tanzania; and

- Interviews with management regarding the exploration strategy and offtake negotiations.

The information is general information only. Any advice is general advice only. Neither your personal objectives, financial situation or needs have not been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice. Adam Kiley (AR No. 458224) is an authorised representative of Intelligent Financial Markets Pty Ltd (AFSL No. 426359).

To view the video, please visit:
http://www.abnnewswire.net/press/en/85707/gpx


About Graphex Mining Ltd:

Graphex Mining Ltd. (ASX:GPX) is an Australian exploration and development company, focused on advancing the world class Chilalo Graphite Project, located in south-east Tanzania. Chilalo is host to a high-grade mineral resource (with an Ore Reserve) and has demonstrated an ability to produce a premium graphite concentrate with a substantial portion of large and jumbo flake material. Chilalo graphite possesses outstanding expandability characteristics, making it ideally suited to the rapidly growing expandable graphite market.

Source: Graphex Mining Ltd.



Contact:

The Sophisticated Investor
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adam.kiley@tsicapital.com.au
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