Judging from the geological tenor of its evolving resource, a critical minerals asset in Central Asia owned by a West Australian-based junior has the credentials to become a formidable presence in the global graphite sector.
And, for the time being at least, the next major task facing the company is to formally size up the project’s metallurgy before it can truly take the market by storm.
Sarytogan Graphite Ltd, which is developing its namesake high grade deposit in Kazakhstan – and hopes its future products will “enable the decarbonisation of energy and transportation” – believes it has an ore body triple the size and grade owned by any other stock exchange-listed graphite proponent on Earth.
At least that’s how Sarytogan’s managing director Sean Gregory put it at Vertical Events’ recent RIU Resurgence Conference in Perth, where he suggested investors who wanted exposure to the electric vehicle (EV) battery market had to climb on board a battery graphite project rather than an industrial one.
Located in central Kazakhstan, the target is 170 kilometres by highway from Karaganda, the fourth largest city in the country, which also happens to be an established mining hub.
Describing the deposit, as “a bulk, close-to-surface, high grade mining proposition”, Gregory said Sarytogan already had a confirmed inferred mineral resource of 209 million tonnes at 28.5% total graphite content (TGC), with the junior now hoping to update this figure during the first quarter of 2023 before launching a scoping study.
A few weeks before the RIU show, the company announced it had intersected high grade TGC intercepts from 14 diamond holes during its latest drilling campaign within the project’s central zone.
Significant intersections above 30 per cent, or thicker than 60 metres, revealed 22.9m at 30.1 per cent from 16.2m (including 5.1m at 35.5 per cent); 25.1m at 34 per cent from 17.9m (with 17.9m at 37.1 per cent); 69.6m at 25.5 per cent from 20.2m (including 4.7m at 37.7 per cent); 15.9m at 32.1 per cent from surface (with 10m at 38.1 per cent), as well as 25.4m at 33.2 per cent (again from surface, and including 5m at 36.6 per cent on top of 16.3m at 36.4 per cent).
Gregory told RIU delegates that the junior, which listed in July, had been drilling before its IPO.
The longer term aim now was to sell its product to both China’s EV anode sector and the battery-producing gigafactories of Europe.
It was expected lithium-ion (Li-ion) batteries would drive the demand for natural graphite from the current 1 million tonnes per annum to 4 Mtpa by 2030.
But to reach this target, the company believes, ultra-fine high purity spherical graphite would be required.
Fittingly, Sarytogan had met the specifications for fine graphite and was targeting future battery anode material.
“It’s really important for investors to understand the different graphite markets that exist,” Gregory explained to the RIU crowd.
“The traditional graphite markets are for coarse flake graphite (used in the production of items such as brake linings and lubricants), and there are a lot of very successful projects doing a great job in East Africa producing a coarse flake graphite.
“And certainly for those projects you want to maximise that coarse flake graphite.
“They have a basket of goods that produce some fine graphite at perhaps $600/t, and they produce some coarse graphite at $1200/t, so they are all about maximising that coarse graphite.
“For us, our strategy is forward facing – we are facing the huge opportunity of electric vehicles and batteries.
“Now, to play in that market, you actually need to get down to an ultra-fine size.
“We’ve already achieved some fines specifications of products traded in the market at 80 and 90 per cent graphitic carbon, and we are working with our laboratory partners to increase that grade up to 99.95 (per cent) to get us up into that $3000/t space, which is where the future for batteries is for us.”
In terms of metallurgy, which Gregory indicated was the next step in the project’s evolution, the company was both on track and confident it would be “the investment catalyst that could drop from any of the labs that are working on the puzzle at the moment”.
The Sarytogan deposit was first explored in the Soviet era during the 1980s with sampling by trenching and diamond drilling. Metallurgical test work, utilising floatation, sintering (roasting), and leaching successfully produced graphite concentrate of up to 98.6% purity.
Now, optimisation test work was ongoing at three laboratories in Germany and Australia targeting continued progress towards the junior’s desired battery anode specifications.
“We have delivered 81% as a flotation concentrate from our laboratory here in Perth and we are optimising that work both here in Perth and also with our partners, ProGraphite, in Germany,” Gregory said.
“We expect to be able to optimise our bid to the mid-eighties.
“The next step in our journey will be either roasting and/or purification.”
At the end of the day, Gregory indicated, the demand for graphite would, in no small way, ride on the coattails of battery technology.
“We all know that lithium has delivered exceptional investment returns to those lucky enough to get in early into that investment market a couple of years ago, but we feel that graphite really is the next cab off the rank,” he told his RIU audience.
“And in fact, when you look at a lithium-ion battery, perhaps they are misnamed – perhaps they should be called a nickel-graphite battery.
“And the reason for that is that’s what batteries are actually made of.
“So a battery requires a cathode and it requires an anode, and on the anode side of the equation – regardless of the battery chemistry ‒ graphite is always the anode.”
