Triton Minerals Ltd (ASX:TON) has signed a binding offtake agreement with Chinese graphite company, Chenyang, for up to 16,000 tonnes of anticipated annual graphite production from the Ancuabe project in Mozambique.
The minimum quantity under the offtake deal is 10,000 tonnes per annum of Ancuabe graphite concentrate for at least five years, with a seller option for a further five years.
Significantly, the selling price under the offtake deal will be determined by prevailing market prices in China, subject to a range, ensuring that Triton retains exposure to the anticipated strong demand for graphite.
Binding offtake agreements for 50% of annual production
Triton has now signed binding offtake agreements for about 50% of the annual projected graphite concentrate production from Ancuabe.
In addition, Triton continues to receive strong expressions of interest for offtake and is continuing to progress negotiations with other offtake parties.
The new agreement is conditional upon Triton making an investment decision, obtaining all approvals and a mining concession and completing construction of the mine and infrastructure.
Strong momentum for financing and development activities
Triton managing director Peter Canterbury said: “Securing binding agreements for up to 50% of forecast annual production with experienced graphite producers in Chenyang and Tianshengda demonstrates the success of Triton’s product marketing strategy and the demand for large flake, high purity graphite in the Chinese market.
“In addition, this external support for the Ancuabe Graphite Project provides strong momentum for our EPC, financing and development objectives, which are on-track to enable an investment decision in 2018 and first production from Ancuabe in late 2019.”