Elon Musk’s Telsa gigafactory in Nevada will be the “barometer of global battery production”, says the boss of graphite play BlackEarth Minerals.

“It’s truly remarkable what Elon Musk is achieving with his Tesla gigafactory in Nevada in the United States – it will be the true barometer of global battery production,” BlackEarth’s Tom Revy told the Paydirt Battery Minerals Conference in Perth on Thursday.

Tesla is putting the finishing touches on its first Gigafactory in Nevada, US, to produce lithium-ion batteries for its much-hyped electric cars.

Gigafactory — a term coined by Tesla — refers to a facility’s annual production capacity in gigawatt-hours (GWh). One GWh is the equivalent of generating 1 billion watts for one hour.

Tesla’s Nevada gigafactory will produce at least 35 GWh of batteries annually.

“Once fully operational in 2020, it will lower its cost of producing batteries by 30 per cent – the site will produce more batteries than were produced globally in 2013,” Mr Revy said.

“By 2020, the total cost will be in excess of $US5 billion ($6.3 billion).”

That’s good news for battery metals players such as BlackEarth.

Each electric vehicle battery requires 60kg of graphite – more than twice the amount of lithium needed.

The forecast is that as much as 70,000 tonnes of flake graphite each year may be required for the Tesla factory alone.

Mr Revy said battery cell manufacturing capacity, led by China, over the past four years has more than doubled to 125 gigawatt hours (GWh) and is projected to double again to 250 GWh by 2020.

A further 60 gigafactories are expected to be built by 2037, multiplying production 10 times from 2020 estimates.

Will Australia house battery "gigafactories" like this Tesla facility in Nevada?
Tesla’s gigafactory battery making facility in Nevada.

Another three graphite anode plants with an annual capacity of 100,000 tonnes per annum are being built in China and Japan, which will bring the total new capacity of anode megafactories to 360,000 tonnes per annum.

These factories alone will require over 800,000 tonnes per annum of mined flake graphite.

BlackEarth, which made its debut on the ASX in January following an initial public offer of $5.45 million, is fast-tracking the development of its Maniry and Ianapera graphite projects in Madagascar and expects to define a maiden resource at Maniry by mid-year.

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