Walkabout Resources has commenced construction prestart activities at its Lindi Jumbo Graphite Mine in Tanzania, in order to bring into production what is scheduled to be one of the highest margin graphite projects in the world.
Chief Operating Officer of Walkabout Resources, Allan Mulligan, said the Lindi Jumbo Mine is rapidly materialising and on track for first production in the second quarter of 2022.
“Our focus in stage 1 and 2 construction are on those items on the critical path including the civils required for plant erection and the continued manufacture and shipping of plant equipment from our EPC contractor in China.”
Securing a US$20 million debt funding facility from CRDB Bank of Tanzania for the high-grade, large flake graphite project in April 2021 was a critical milestone in the company’s advancement to construction, as was the completion of the first stage of the companion equity contribution in May 2021.
The second tranche of a three-stage development capital raise is currently underway with shareholders to be invited to participate in a Rights Issue on the same terms as the Institutional Placement to raise up to A$7.6 million which closes on Monday 25 June. Alternatives for the final and third tranche are currently being assessed by the Board with an announcement expected before the end of the quarter.
“The CRDB debt facility provided a critical platform from which to commence raising the companion equity. Our second tranche capital raising is underway in tandem with price tensions in the large flake graphite market and as we mobilise contractors under stage 1. As such, we are expecting a very positive response from shareholders.”
At completion of the third tranche equity raising, Walkabout will be fully funded to production with construction and commissioning expected to take 9-12 months.
“What sets Lindi Jumbo apart from most other graphite deposits is its very high percentage of Large, Jumbo and Super Jumbo sized flakes in concentrate, positioning us to capture premium-priced and value-added industrial markets,” Mr Mulligan said.
“With large flake graphite prices increasing by more than 2 per cent in April and demand from the lithium-ion battery industry expected to outstrip supply by 2025, Roskill has predicted prices will continue to rise.”
The Lindi Jumbo Graphite Project is situated in south-eastern Tanzania, approximately 200 kilometres from the port of Mtwara. Lindi Jumbo represents the first serious construction effort of a mining project in the country since the 2017 Mining Act amendments.
Since April this year, new President Samia Suluhu Hassan has seen Tanzania renew discussions with international resource companies to expedite large projects, tackle coronavirus with a new advisory committee and also reinvigorate international relations to promote investments and drive trade. Walkabout says this can only benefit Lindi Jumbo as Tanzania revitalises its approach to attracting international businesses.