EcoGraf has identified a potential 20% increase in Epanko’s Stage 1 production capacity, while contracted European offtake has doubled to 40,000 tonnes per annum. The company is advancing debt financing and downstream plans, but its higher-output case remains outside the current financing base case.
- Potential Epanko capacity increase from 73,000tpa to 87,600tpa
- First 10-year C1 costs estimated at US$512.3/t
- Contracted offtake increased to 40,000tpa
- A$4.727 million raised after quarter end
- Quarter-end cash of A$1.767 million covered 0.86 quarters of reported outgoings
Epanko Expansion Could Add 20% to Stage 1 Capacity
EcoGraf Limited (ASX:EGR) has identified a potential 20% increase in the planned Stage 1 capacity of its Epanko graphite project in Tanzania, lifting nameplate production from 73,000 tonnes per annum to 87,600tpa. The value engineering review estimates first-10-year C1 operating costs at US$512.3 per tonne, 5.8% below the Updated Bankable Feasibility Study case.
The proposed uplift would require about US$12 million of incremental capital, including US$5.5 million for the processing plant and US$6.5 million for tailings storage. EcoGraf says the amount sits within the US$22 million contingency allowance in the feasibility study. The higher-throughput plan would shorten the projected mine life from 22 years to 20 years, while relying on the unchanged 16.7 million-tonne ore reserve at 8.2% total graphitic carbon.
The company has not disclosed an updated net present value or internal rate of return for the expansion case. The existing 73,000tpa plan remains the basis for Epanko’s debt financing process, with the 87,600tpa option still subject to further engineering work. The filing therefore describes an attractive operating possibility, rather than a settled project redesign. EcoGraf had earlier set out the assumptions behind the Epanko capacity increase, including the lower estimated unit costs and additional capital requirement.
European Offtake Strengthens the Financing Case
EcoGraf has also secured a binding term sheet with a major German graphite trader covering 20,000tpa from production commencement, rising to 40,000tpa after the first five years under a planned 10-year term. Together with the existing agreement with tk accelis Trading, contracted European sales now total 40,000tpa.
Pricing is linked to market reference prices and includes a floor price intended to provide downside protection. The contracted volume leaves uncommitted production available for EcoGraf’s proposed battery anode material strategy and future customer requirements. It also gives the company a clearer commercial foundation as it pursues staged expansion beyond the initial mine plan.
Debt Process Moves Toward Euler Hermes Submission
EcoGraf continues to work with KfW IPEX-Bank on a proposed senior secured facility of up to US$105 million under Germany’s Untied Loan Guarantee scheme. The project has received a non-binding indication of in-principle eligibility for import credit cover, but an independent expert opinion and further lender work are required before a binding offer of cover can be considered.
Following submission of the Independent Engineers Report, the company has been addressing additional queries and refining the financing model, commercial terms and risk allocation. It says the objective is to prepare a comprehensive package for Euler Hermes and move Epanko toward a Final Investment Decision. The European Investment Bank has meanwhile commenced work under a grant of up to €2 million, supporting technical, environmental, social and market studies across Epanko’s expansion, Tanzanian shaping facilities and proposed European purification operations.
Capital Raise Improves Liquidity but Runway Remains Tight
EcoGraf ended September with A$1.767 million in cash and cash equivalents after using A$1.33 million in operating activities and A$720,000 on exploration and evaluation. On the Appendix 5B calculation, that represented 0.86 quarters of funding at the reported level of outgoings, with no financing facilities drawn or available at quarter end.
The position improved after the reporting date through an A$4.727 million capital raising, comprising an A$3.552 million Share Purchase Plan and an A$1.175 million placement at A$0.222 per share. The proceeds are earmarked for Epanko debt financing, strategic equity and offtake work, development studies, gold exploration and working capital. The raise had previously been reported as completed through the A$4.727 million capital raise, but it does not remove the need for larger-scale project funding.
Beyond graphite, AngloGold Ashanti completed 2,659 soil samples across the Golden Eagle gold project, with assays pending, and began preparing a high-resolution UAV magnetics survey. That work sits within a five-year US$9 million farm-in agreement and provides a separate exploration stream while EcoGraf pursues its more capital-intensive graphite development strategy.
Bottom Line?
The next value-defining milestones are final engineering for the 87,600tpa option, progress toward Euler Hermes-backed debt, and evidence that strategic equity can complement the recent capital raise without leaving Epanko underfunded.
Questions in the middle?
- Will the 87,600tpa expansion generate a sufficiently attractive updated NPV and IRR to replace the 73,000tpa financing case?
- Can EcoGraf convert the German offtake and strategic-partner discussions into binding financing support and a Final Investment Decision?
- How quickly will the A$4.727 million raise be consumed before project-level funding is secured?