Development decisions often hinge on strong margins. Graphex Mining (ASX:GPX) certainly seems to have achieved that with its Chilalo graphite project in southeast Tanzania.

In its definitive feasibility study (DFS), the company estimated that Chilalo could deliver net present value (NPV) of $US331m ($489.6m) and internal rate of return (IRR) of 36 per cent.

Both NPV and IRR are metrics used to assess the profitability of a project.

Capital costs have also been estimated at a relatively unchallenging $US87.4m.

Chilalo is expected to produce about 50,000 tonnes of  graphite products per annum over an 18-year mine life.

With some of the world’s coarsest flake graphite, the project is aimed at fulfilling the unmet demand in graphite foil, gaskets, seals and fire-retardants.

The stock — which is down about 16 per cent over the past year — nudged higher in morning trade.


Graphex has already identified opportunities for mine life extensions and reductions in operating costs from near-mine exploration upside.

It also has an expandable graphite processing term sheet in place with China’s Yichang Xincheng Graphite.

“With key approvals in place, including a mining licence, environmental certificate and community relocation arrangements and compensation agreed and approved, we are in a strong position to readily commence development with first production by Q4 2021,” managing director Phil Hoskins said.

READ MORE: Graphex cuts through more red tape to reach that $112m funding package

In other ASX tech metals news today:

Anson Resources (ASX:ASN) has kicked off engineering studies for its Paradox lithium-bromine brine project in Utah.

The studies are expected to be completed in April and will then be expanded into a pre-feasibility study.

Anson currently envisages a 15,000 tonne per annum (tpa) commercial bromine plant and a 700tpa lithium pilot plant for the first stage development of the project. This will be expanded to a 60,000tpa bromine plant and 15,000tpa lithium plant in the second stage.