Graphite play Renascor Resources applauds $400m clean energy funding in its home state
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Purified spherical graphite (PSG) company Renascor Resources (ASX:RNU) has welcomed Australian and South Australian government funding to promote low carbon emissions projects in South Australia.
Renascor Resources said its Siviour PSG project in South Australia fits well with the fund’s key policy objective of supporting the next wave of new energy technologies.
“The Siviour project will be among the world’s lowest cost producers of an important value-added graphite product, a critical mineral that is fundamental to the growth of the EV and renewable energy and battery storage industries,” managing director, David Christensen, said.
The governments of Australia and South Australia agreed at the weekend to support the $1.08bn State Energy and Emissions Reduction Deal that includes $400m for investment in carbon capture and storage solutions, EVs, hydrogen and other emissions reduction projects in the Australian state of South Australia.
“The commitment of the governments towards security of energy supply in South Australia, and the targeted investment in priority areas, provides Renascor additional confidence in our strategy of integrating our world-class Siviour graphite mine and concentrator with a downstream PSG manufacturing facility,” said Christensen.
Renascor Resources announced in early April an acceleration of its Siviour PSG project toward a stage two expansion beyond its initial 28,000 tonnes per year stage one production capacity.
This was in response to increasing inquiries it has received from major battery anode suppliers after executing off-take deals for all of its stage one project production.
The company’s Siviour graphite deposit in South Australia has one of the largest ore reserves outside of Africa and the second largest proven reserve in the world.
“The Siviour project is a first for Australia. Indeed, it will be the first in-country mine and battery anode material operation outside of China,” said Christensen.
Demand is starting to outpace available supply in the graphite market, leading to an increase in prices for the battery raw material and a move of the market into deficit.
Siviour aims to be the first integrated in-country mine and battery anode operation outside of China, and exhibits strong clean energy credentials leading to it attracting in principle financial support from Australia’s Clean Energy Finance Corporation.
The project will create skilled jobs in critical minerals downstream processing, and in rapidly growing clean energy industries such as EVs and battery storage.
“Our ability to locate our operations entirely within South Australia will provide security of supply and lead to the creation of higher value manufacturing jobs and the capture of downstream value through the production of PSG for sale directly into the EV raw material supply chain,” said Christensen.
The State Energy and Emissions Reduction Deal is designed to contribute to South Australia achieving a target of net 100 per cent generation from renewable sources by 2030.
Under the deal, the Australian government’s contribution to the fund is $660m; South Australia’s contribution is $442m.
There are several ASX companies with graphite projects located in Australia and around the world including countries such as Madagascar, Mozambique, Norway, and Tanzania.
Bass Metals (ASX:BSM) has its Graphmada project in Madagascar off Africa’s east coast, Battery Minerals (ASX:BAT) with its Montepuez project in Mozambique, and BlackEarth Minerals (ASX:BEM) also in Madagascar hosting its Maniry project.