Ceylon Graphite is a publicly listed company focusing on the exploration and production of battery-grade graphite for commercial uses such as electric vehicles.
Ceylon Graphite’s mission is to be the pre-eminent global supplier of the highest value-added graphite products, while practicing environmental excellence and good governance.
We are at the forefront of developing superior battery-grade graphite for electric vehicles which commands a higher selling price of $10,000 per tonne compared to the unprocessed graphite price of $1,800 per tonne. Contrasting unprocessed graphite, the price of battery-grade graphite can be expected to increase steadily, based on the projected growing supply deficit.
To supply our battery-grade graphite we require an off-take agreement with an OEM, such as Tesla or Panasonic, in order to fund development of a processing facility at a development cost of approximately $60m.
While seeking an off-take agreement, we are in the enviable position of being able to significantly grow our cash flows through selling unprocessed graphite. We have ten mines in Sri Lanka that can be brought into production at a low development cost of $2m per mine, each of which would produce 5,000 tonnes per year.
Because we have high-grade vein graphite, that is direct-shipping ore (meaning no milling or tailing dam is required), we expect to have gross margins of 70% after royalties even at the low, unprocessed graphite price. Accordingly, by financing the first few mines into production, we expect to subsequently be able to grow out of free cash flows.
The generation of substantial free cash flows could assist in the development of a processing facility without significant shareholder dilution once an off-take agreement has been made. Once a processing facility is developed with the support of an off-take agreement, our revenue growth potential increases from $90m to $500m once all ten mines have achieved commercial production at a combined production rate of 500,000 tonnes per year. Production can increase incrementally thereafter.
We expect to meet all the requirements for an off-take agreement including:
- Ceylon’s vein graphite anode material far exceeded comparable anodes made with standard synthetic in testing
- Results came in a 382 mAh/g for reversible capacity (RC), which is beyond what is expected for the best current commercially used synthetic graphite with an RC of 363 mAh/g
- Environmentally sustainable:
- Little land disturbance with underground mining
- Direct shipping ore requires no milling or tailings pond
- Security of supply:
- We own the graphite from the source
- Each mine can be expected to have a 20 to 50 year mine life
- Management capability:
- Don Baxter, president and CEO, is one of the premier graphite experts outside of China, having built one of only two producing graphite mines in North America
- Skilled mine operators
- Technical Capabilities with renowned materials scientists Dr Siva and Dr. Mallika Bohm on board who create the final graphite end products that meet OEM’s battery specifications
- Demonstrated financing capabilities
- Key Near-Term Catalysts:
- Mine development financing, cash flow growth, off-take agreement
AREAS OF EXPERTISE:
- Mine development and operation
- Research and development
- Financing ability
- Proprietary processing technologies produces a Li-ion battery with significantly higher power and energy