Major Chinese contractor backs Black Rock's Mahenge graphite

Major Chinese contractor backs Black Rock's Mahenge graphite

Tue, 25/09/2018 - 11:09
Black Rock

Black Rock's John de Vries (left) with Yantai's executive director, Mr Xu. Photo: Black Rock Mining

Black Rock Mining has won the backing of a major Chinese mining machinery group, with Yantai Jinyuan Mining Machinery signing on as the ASX-listed graphite explorer’s construction partner for the Mahenge operation in Tanzania.

Under a strategic cooperation initiative announced to the ASX, Yantai will supply process plant machinery and related infrastructure for the Mahenge mine, which hosts one of the world’s largest JORC-compliant flake graphite mineral deposits globally.

Yantai, which has distributed mining infrastructure and equipment to 13 countries worldwide and 20 provinces within China, will also work with Black Rock to secure a $US40 million funding package for the mine from Chinese financiers.

Black Rock is planning to produce around 83,000 tonnes of 98.5 per cent graphite concentrate annually in the first stage at Mahenge, with Yantai to work with Black Rock’s current contractor, CPC Engineering, to complete a definitive feasibility study for the operation.

Two subsequent expansion stages would increase annual production to around 250,00tpa.

Earlier this year, Black Rock said it expected the DFS to be complete by the end of September, with pre-production estimates indicating the mine will cost around $US90 million to construct.

Black Rock chief executive John de Vries said Yantai had significant experience in manufacturing and constructing graphite processing infrastructure, most recently at major projects in China and Tajikistan.

Mr de Vries said along with establishing a pathway to project finance, the Yantai agreement would also open further sales channels for production from the Mahenge mine.

“In many cases, substantial elements of most modern metallurgical concentrators are either delivered in part or in full through some form of offshore procurement,” Mr de Vries said.

“We see this as an opportunity to take the concept of offshore supply chian to its natural extent and to establish and east meets west outcome by combining the best of Chinese supply chain and delivery capability through Yantai, and Australian innovation and delivery focus through CPC.

“In addition to Yantai’s reputation of delivering successful graphite plants throughout China, we are excited to be aligned with Yantai’s brand.

“Yantai’s endorsement of Black Rock’s quality product through this agreement provides an important new channel to market through our association with a proven capacity to deliver quality graphite to the Chinese offtake market.”