EcoGraf secures $55m for graphite facility

West Perth-based EcoGraf has secured funding from institutional investors to finalise the construction of its $98 million battery graphite processing plant in Kwinana.

The company emerged from a two-day trading halt this morning, announcing it had received commitments to raise $54.6 million from a share placement.

EcoGraf is planning to produce high-purity battery graphite from its 5,000 tonnes per annum processing plant (under construction), which will increase to 20,000tpa upon completion.

It forms part of an agreement between EcoGraf and state government-owned DevelopmentWA, as announced in September last year.

The graphite product will be suitable for lithium-ion batteries, which are used in electric vehicles. EcoGraf is one of many battery-focused businesses benefiting from the growing EV market, with its share price surging by more than 1,000 per cent over the past six months to a high of $1.

Today, EcoGraf said it had secured cornerstone investments from Australian, North American and German institutions as part of the capital raising.

The proceeds will be used to finalise construction works associated with phase one of the graphite plant, which will be the first of its kind outside of China. Its detailed engineering design is being carried out by listed company GR Engineering Services.

The placement proceeds will also be used to finalise both EcoGraf's battery anode material recycling programs and debt funding arrangements for its Epanko mine in Tanzania. 

The company had reduced operational expenditure at the Epanko mine in April last year in a bid to save costs during the height of COVID-19.

EcoGraf will issue 91 million shares under the placement, priced at 60 cents each, with Canaccord Genuity acting as lead manager.

Shares in EcoGraf were down 9.8 per cent at 1:25pm AEDT to trade at 90 cents.