Quantum Graphite Secures 20-Year Ore Supply Deal with Sunlands Pure Group

Exclusive 20-Year Supply Agreement with Sunlands Pure Group

Quantum Graphite Limited (ASX:QGL) has formalised a long-term commercial framework with Sunlands Pure Group (SPG) to exclusively supply Uley flake graphite ore for the next 20 years. This Ore Supply Agreement (OSA) consolidates all downstream processing and refining activities within SPG, aligning Quantum’s production pathway with a partner capable of delivering refined graphite at competitive scale and cost.

Under the OSA, Quantum will supply a minimum of 85,000 tonnes of mineral production per month, generating around 9,000 tonnes of 96% purity flake concentrate. This concentrate will then be shipped to SPG’s refinery in Al Buraimi, Oman, where it will undergo hydrofluoric acid leaching to achieve a purity exceeding 99.9%. The refinery is designed for modular expansion, targeting at least 100,000 tonnes per annum (ktpa) of purified flake graphite initially, with plans to scale up to 500ktpa within seven years.

Oman Refinery Secures Final Environmental Approvals

SPG’s refinery site in Al Buraimi has received final environmental authorisations covering construction, operations, and ongoing environmental management. These approvals include stringent standards such as ISO 14001 and Australian chemical handling protocols, underscoring the project's commitment to safe and sustainable operations. The refinery ecosystem extends beyond purification to include hydrofluoric acid production, limestone milling, water management, and an on-site laboratory for quality assurance.

The refinery’s strategic location approximately 60 kilometres from Sohar Port positions it well for global export markets. The project has also been recognised as a significant national initiative by the Governorate of Al Buraimi, formalised through a Memorandum of Understanding that supports expedited development.

Engineering Progress and Project Financing

Quantum has initiated the Front-End Engineering and Design (FEED) phase for the Uley 2 project, engaging Lycopodium Minerals to finalise infrastructure and processing plant designs. This work builds on prior feasibility studies and value engineering assessments, setting the stage for detailed cost and schedule estimates essential for project execution and financing negotiations.

Alongside engineering, Quantum has finalised the financing structure for Uley 2, integrating processing and refining activities within the broader development plan. The OSA’s pricing model is cost-plus with a floor price guaranteeing Quantum a margin of approximately A$375 per tonne of concentrate, protecting against price downside while allowing annual price reviews.

Operational and Financial Snapshot

The Uley 2 project’s updated feasibility metrics show total undiscounted cash flow of A$990 million, with annual production of 100,000 dry metric tonnes of concentrate at a product cost of US$401 per tonne and an ex-works price of US$1,225 per tonne. The project benefits from substantial JORC 2012 mineral reserves and resources, supporting long-term production targets.

On the cash flow front, Quantum reported an operating cash outflow of A$1.224 million for the quarter ended 30 June 2026, with cash reserves of approximately A$210,000 and financing facilities totaling A$10.5 million at quarter-end. The company maintains access to additional funding through equity and related-party support, providing a runway of over two quarters at current expenditure levels.

Resource Expansion and Site Management Agreement Pending

Quantum continues to prioritise resource expansion drilling across multiple targets within the Uley region, aiming to enhance the mineral inventory underpinning production growth. Meanwhile, negotiations are ongoing for a Site Management Agreement (SMA) with SPG to govern operational logistics at the Uley 2 mine site, expected to clarify site use and ore supply mechanics ahead of project ramp-up.