Globe Metals and Mining, the Australian publicly listed mining group, has bought 100 percent of an advanced graphite project in Malawi at $80 000 (K20m), the companyâ€™s managing director Mark Sumich has said.
The graphite asset has an exploration target of 15 to 20 metric tonnes with about 10 percent graphite.
The licence area, 45 kilometres North East of Lilongwe, comprises 2 020 square km and hosts at least 12 zones of graphite mineralisations.
Globe, whose main focus is the multi-commodity Kanyika Niobium Project in Mzimba, Malawi, expected to commence production of ferroniobium, a key additive in sophisticated steels in 2014, is an African-focused resource company. It specialises in rare metals such as niobium, tantalum fluorite, uranium and zircon.
Sumich said graphite is not only sought after commodity at present, but it is a natural acquisition for the company, both in terms of its location in Malawi and the crossover with Rare Earth Elements (REEs) in relation to the more advanced technological applications.
â€œGraphite is a strategic mineral in high demand with advanced technology applications such as lithium-ion batteries,â€ said Sumich in a statement.
According to the company, the asset has more than one million metric tonnes of graphite and this consolidates Globes already strong position in Malawi.
It said currently, China dominates graphite production and consumption.
In April 2011, Globe partnered with East China Mineral Exploration and Development Bureau (ECE), Chinese State-owned enterprise and this position helps to leverage Chinese finance, partners and technology.
The miner said the graphite transaction is, however, subject to due diligence and usual government approvals.
Early this year, the company said it is on target for the completion of the definitive feasibility study at Kanyika by the end of 2012.
Once operational, the mining project is expected to rake in $170 million (K42 billion) per year, according to the company and create jobs for a number of Malawians.