Canadian and Australian firms have signed a deal to supply 24,000 tonnes of flake graphite annually to South Korea’s expanding lithium battery industry.
Under the terms of the agreement, Canadian graphite developer DNI Metals will supply the material from its projects in Madagascar to Korean Graphite— a subsidiary of Australia’s Peninsula Mines— from the fourth quarter of this year.
Western Australia-based Peninsula said the deal, which is subject to finalising offtake agreements with battery makers in South Korea, also paves the way for it to establish a graphite development and production operation in South Korea to supply the domestic and wider Asian markets.
According to Peninsula, Korea Graphite is already working on studies to develop “key graphite projects” in western South Korea at Chugwang and Eunha, where channel sampling and bulk sampling for metallurgical testing is under way.
Peninsula MD Jon Dugdale said the company had “established strong relationships with Korean end-users that are looking to secure flake graphite supply for lithium-ion battery anode production” and other uses.
Dugdale said: “Madagascar has been producing high-purity, large-flake graphite for over 100 years and DNI’s large-flake graphite deposits are saprolite hosted and close to port, thus meeting Peninsula’s criteria for low cost supply potential.”
The government of South Korea said last year it was backing plans by the country’s battery giants including led by battery giants LG Chem, Samsung SDI and SK Innovation Companies, to inject a total of KRW2.3 trillion ($2.3 billion) into the sector over the next three years, to expand production and challenge China’s increasing dominance of the market.
Last December, Canada-based lead-acid battery maker Discover Energy confirmed it had acquired South Korean battery manufacturer iQ Power Asia to help underpin Discover’s global supply of automotive and commercial batteries.