Quantum SA hub to support major Australia-US graphite supply chain

Quantum Graphite and its joint venture partner Sunlands Energy have received a big tick from the federal government that will help the two companies develop their graphite hub to support a big Australia-United States graphite supply chain. 

Federal Industry and Science Minister Ed Husic has approved a three-year major project status grant for the hub on SA’s Eyre Peninsula, recognising its national significance. The hub also aligns with important government strategies for critical minerals and battery storage and a federal commitment to a US initiative to accelerate the development of diverse critical minerals supply chains. 

Quantum says the Eyre Peninsula hub will support the biggest commodity-focussed graphite supply chain between Australia and the US. It will be centred on Quantum’s flagship Uley 2 graphite project and use Sunland’s associated manufacturing, logistics and inventory management facilities. 

Sunlands’ refining technology is uniquely capable of purifying natural flake graphite to 99.9 per cent graphitic carbon, which will then be delivered to key markets such as manufacturers of lithium-ion battery, isostatic graphite and thermal energy storage.

Quantum’s Uley flake graphite deposits lie southwest of Port Lincoln. Its main Uley 2 project represents the next stage of development of the century-old Uley mine, which is arguably one of the world’s biggest high-grade natural flake deposits.

Uley’s total combined resource is 15 times greater than the world’s annual flake graphite production.

The Uley 2 project comprises graphite-rich envelopes lying within a 1200-metre radius. These include the existing JORC-compliant estimated mineral resource of 7.2 million tonnes of 11.10 per cent graphitic carbon, which includes a 4.3mt ore reserve grading at 11.89 per cent graphitic carbon.

The companies have already obtained all South Australian Department of Energy and Mining approvals and the project is shovel-ready.

Quantum Graphite’s managing director Sal Catalano said: “The support from Ed Husic is very encouraging and will mark a meaningful contribution towards the Eyre Peninsula becoming Australia’s leading graphite region. The hub links Uley 2, a scalable, high-quality graphite resource and key infrastructure, with the US Atlantic Coast, a gateway to one of the largest global markets.” 

The partners propose to mine and process flake graphite ore at the hub to produce 100,000 tonnes of graphite concentrate annually. 

The hub will also include Sunland’s manufacturing facility for long-duration graphite-based thermal energy storage (TES) cells.

Long-duration TES cells use insulated graphite blocks to store electricity as heat for extended periods. They then release the stored heat to generate electricity to drive commercial, industrial and utility-scale steam turbine generators. The cells are often used to supplement and/or stabilise and balance output from renewable electrical energy sources such as solar and wind farms outside peak times. 

Sunlands’ TES graphite cells are capable of restoring baseload generation, delivering critical synchronous support to grid networks and could eliminate the large-scale curtailment of renewables generation.

The hub’s integration with onward graphite refining operations to be developed by the partners in South Carolina are essential to the concept’s overall success. The refining operations will produce better than 99.6 per cent purified graphite.

The resulting end-to-end supply chain is expected to ensure an uninterrupted and scalable supply of US high-purity graphite from the Australian concentrate.  

Quantum says co-locating Sunland’s TES processing and manufacturing facility with the graphite mining and production activities on the Eyre Peninsula will help underpin Australia’s global competitiveness in the sector.

The hub is also expected to deliver significant long-term benefits to the local community, by providing additional employment opportunities and local technical skill-building. Considerable royalties and taxes should flow from the hub through to the Federal and State governments. 

But most significantly for the partnership, perhaps, the major project status grant will help Quantum’s efforts to accelerate a US$300m (A$483m) financing proposal with US-based EXIM Bank, and to meet off-take company MRI Trading AG’s objective to deliver a required annual 100,000 tonnes of high purity graphite into the market by the first quarter of 2027.

As these elements fall into place, the joint venture can anticipate some exciting times ahead.

Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au