Evion Group (ASX:EVG) has locked in a $2 million deal for the sale of the first 10 weeks of expandable graphite production from the joint venture operations in India.
The production is going to Germany’s Technografit GmbH, which Evion says is one of Europe’s leading graphite trading companies.
The initial 386 tonnes of production is being sold at between US$3,000 ($4,548) and US$3,3300 ($5,005) per tonne free on board.
Production costs are forecast to be in the range of US$1,500 to US$1,750 per tonne with potential for future cost savings in the short term.
Investors welcomed the news, with shares climbing nearly 21% to an intra-day high of $0.035.
Managing Director David Round says following two years of careful planning, construction and testing, Evion has reached the stage of producing and selling its expandable graphite to the European market.
“Our expandable graphite facility near Pune, India is a technologically advanced, clean energy driven project that will produce globally significant quantities of expandable graphite to meet the world’s burgeoning demand of this material from sources outside of China,” he says.
“We have undertaken extensive research and testing with buyers and believe we can grow our business to be one of the largest producers of graphite downstream products in the world outside of China.”
Evion, which has a market capitalisation of $10.2 million, expects to lock in further sales contracts in the short term for ongoing supplies for the remainder of 2025. The JV anticipates it will host another delegation of buyers in Q4 2024.
Expandable graphite is used in the electric vehicle, aerospace, energy storage and electronics industries.
It is also a key material used as a fire retardant, with China, the European Union, Japan and Korea all now mandating its use in the construction of buildings following several global fire disasters.
Australia has also placed restrictions on non-flame-retardant building construction leading to an increased use of expandable graphite.
The global expandable graphite market is anticipated to grow at a compound annual rate of 7% between 2024 and 2030 to reach $US707 million.
Evion expects the JV will sell more than 2,000 tonnes of expandable graphite over the first full year of operations, with gross revenue expected to be in the range of US$6 million to US$7 million.
The plant has the capacity to produce a further 500 tonnes of material, and Evion says it is confident that production levels can be achieved in the medium term to increase sales volumes.
The JV is currently updating the Feasibility Study to assess the viability of expanding production to 4,000 tonnes per annum, effectively doubling production.
Evion says a previous assessment indicates that the overall capex requirements would be in the range of US$500,000 to US$750,000 with the expanded plant able to produce an additional US$6 million worth of revenue from annual sales.
Write to Angela East at Mining.com.au
Images: Evion Group
