S Korea’s Posco may build Magnis Resources’ Tanzanian project
October 27 2015 11:06 PM

A man walks past the Posco logo displayed on a steel structure outside the company’s showroom in Seoul. The South Korean firm  may help arrange financing for a graphite project in Tanzania.

Reuters
Melbourne

 
South Korea’s Posco may build and help arrange financing for a graphite project in Tanzania being developed by Magnis Resources, as the Australian explorer races to start producing from the east African site by 2017.
Demand for graphite is expected to soar as it is a major ingredient in lithium-ion batteries for hybrid vehicles and wind and solar energy storage, with appetite for greener transport and energy booming.
Magnis said yesterday it had signed a memorandum of understanding that could see Posco Engineering & Construction arrange debt from lenders it has ties with for the $210mn Nachu project, as well as coming up with a fixed-price bid by mid-2016 to build the mine and processing plant.
“The quality of the graphite at Nachu is the best in the world and with the huge demand in the battery market, we are excited to be involved with Magnis,” Posco E&C mining plant business group director Peter Lim said in a statement put out by Magnis.
Electric car maker Tesla Motors is looking for graphite supply for a factory it is building in Nevada which it says will make more lithium ion batteries annually by 2020 than were produced globally in 2013.
Magnis is in talks to line up debt and construction proposals from a range of sources in order to get the most competitive offers and the quickest development plan, said its chairman, Frank Poullas.
The plan with Posco E&C is similar to one that Magnis lined up with state-owned China National Nonmetallic Minerals Industrial Corp (SINOMA) for $150mn in potential project finance and construction services.
SINOMA is one of two Chinese companies that have agreed to buy a total 180,000 tonnes a year, or about 70%, of the planned output from Nachu. Supply agreements like those are key to lining up financing.
“The remaining offtake that we plan to sign will be with western groups, just to spread that risk,” Poullas told Reuters.
“What we’ve seen with a lot of parties looking, when it comes to financing, is they want western offtakes.”  Poullas declined to comment on whether Magnis was in talks to supply Tesla.

Last updated:


There are no comments.

LEAVE A COMMENT Your email address will not be published. Required fields are marked*
MORE NEWS

HAPPENING IN DOHAMore