Triton Minerals has signed a non-binding memorandum of understanding (MoU) with Chinese graphite company Qingdao Jinhui Graphite to develop its Ancuabe Graphite Project in Mozambique.
Triton’s Ancuabe project is in the proven graphite region of Cabo Delgado and is located next to the producing AMG Graphit Kropfmuhl graphite mine.
Prior to signing the MoU, Triton was engaged in several commercial and technical meetings with the management of Jinhui.
The parties will now start technical, legal and commercial due diligence and continue negotiations to secure a binding agreement within a period of six months.
Triton Minerals managing director Peter Canterbury said: “This MoU with Jinhui is a significant endorsement of the Ancuabe Project.
“It is further evidence that Chinese domestic producers are now actively looking to East Africa to expand and diversify their high purity and large flake supply chains in preparation for the significant growth anticipated in the battery and flame-retardant materials markets.
“This MoU also is complementary to our financing discussions in China which are progressing well.”
It was envisaged in the MoU that the binding agreement would include a direct project level investment of up to 10% in the Ancuabe project.
Additionally, the project will receive financing support through concessional debt and equipment financing facilities.
The binding agreement will also include offtake of up to 15,000t per annum of graphite concentrate and technical collaboration for value-added processing that will see supply of Ancuabe graphite into the flame retardant, refractories and battery markets in China.
In April last year, Triton secured the first offtake deal for graphite from its Ancuabe project with Chinese graphite processor and distributor Qingdao Tianshengda Graphite.