ASX-listed graphite juniors Triton Minerals and Peninsula Mines enjoyed strong increases in their share prices yesterday after inking deals for supply of  graphite concentrate to feed growing demand for the metal.

Graphite is one of the metals required in the development of lithium-ion batteries which are used in electric vehicles and other appliances.

Shares in Triton (ASX:TON) closed 15 per cent higher at 6.1c while Peninsula (ASX:PSM) closed up 9 per cent to 2.4c.

Perth-based graphite Triton signed a deal with Chinese-backed Sinoma Overseas Development Company, a big construction materials company and subsidiary of China National Building Materials Group Corporation.

Both parties will negotiate terms for offtake of up to 50 per cent of graphite concentrate production from its Ancuabe graphite project in Mozambique and engineering, procurement and construction (EPC) services for construction of a concentrate plant.

The memorandum of understanding (MOU), which is not legally binding, also covers debt financing arrangements for construction of the project and project-level investment.

Triton’s managing director Peter Canterbury said the deal was transformational for the company.

“Securing the MOU with SINOMA, an ideal project partner for Triton given its deep expertise in the Chinese building materials sector, and its financial strength and project execution capability, underscores the quality of the Ancuabe Project and increasing demand for expandable graphite,” he said.

Demand for graphite was growing rapidly in China and elsewhere, Mr Canterbury said.

“The use of expandable graphite in flame retardant building materials and the development of new industrial applications is driving increasing graphite demand. Supply disruptions in China and recent legislative changes in Tanzania are resulting in end users seeking new sources of premium grade graphite,” he said.

Triton is also in talks with other partiers for graphite offtake agreements.

Meanwhile, Peninsula has also recently inked a non-binding MOU with Canadian-listed DNI Metals for the supply and potential development and production of up 20,000 tonnes per annum of large flake graphite concentrate to South Korean end-users.

“There is an opportunity to initially supply and potentially produce large flake graphite concentrate to rapidly meet the exponential growth in flake-graphite demand to feed the expandable graphite and lithium ion battery markets in South Korea, Peninsula Mines managing director Jon Dugdale said.

The news comes after Peninsula signed a deal with Korean graphite producer Graphene Korea in June this year for the supply of up to 20,000tpa of large-flake graphite concentrate and development of mining and processing facilities in South Korea.

“Peninsula is uniquely placed in South Korea, with offtake relationships, advancing projects and now this large-flake supply and potential development MOU which will enhance our ability to deliver into the offtake MOU signed with Graphene Korea,” Mr Dugdale added.