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Sovereign Metals study reveals lowest cost for Graphite Project

A rare combination of low costs and a realistic scale of production.
Sovereign Metals study reveals lowest cost for Graphite Project
Sovereign is expected to achieve payback in under two years

Sovereign Metals’ (ASX:SVM) scoping study has revealed capital and operating costs at the very bottom of the graphite supply cost-curve for its Malingunde Graphite Project in Malawi.

The results of the scoping study demonstrate the potential for the Malingunde Project to support an annual graphite concentrate production of circa 44,000 tonnes over an initial mine life of 17 years.

Malingunde’s estimated total operating costs of circa US$301 per tonne concentrate is the lowest of any reported ASX-listed peer company of <300,000 tonnes per annum scale.

Furthermore, the total capital cost of US$29 million to produce circa 44,000 tonnes of concentrate per annum is the lowest capital intensity compared to Sovereign’s peers.

This has enabled the company to prepare a scoping study with a rare combination of low capital and operating costs at a realistic scale of production.

Importantly, Sovereign is expected to achieve payback in under two years using conservative graphite pricing assumptions.

The project will use a simple process flow sheet with no primary crush or grind, leading to low processing costs and lower capital requirements.

Sovereign is targeting a simple mining and processing operation, selling reasonable volumes of high-quality graphite concentrates into existing markets.

The company is in a unique position of targeting the economic production of graphite without relying on extreme size to achieve economies of scale.

Sovereign’s share price increased circa 67% during the past three months, last trading at $0.13.

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