EcoGraf: Graphite upstream processing in Tanzania could save up to 50% in energy costs
EcoGraf Limited (ASX: EGR; FSE: FMK; OTCQX: ECGFF) could in future not only operate its Epanko graphite mine in Tanzania, but also build and operate its upstream processing plant in Tanzania with a capacity of 20,000 tonnes per year of unpurified spherical graphite (SPG) and fines from natural flake graphite. Good international logistics and, above all, cheap electrical energy from hydropower with operating cost savings of up to 50% compared to OECD countries are important location factors in Tanzania’s favour.
This is the conclusion of the latest study completed by Ecograf on the “mechanical shaping of unpurified active anode material for the lithium-ion battery market”. The mechanical micronisation and shaping of natural graphite is particularly energy-intensive. It is the first step in the conversion of high-quality flake graphite concentrate into battery-grade anode material for the production of lithium-ion batteries. Graphite concentrate less than 150 microns in size is ball milled in a series of special milling machines to produce spheronised graphite with very tight physical specifications. Extensive testing by EcoGraf has confirmed that the Epanko concentrate meets the precise physical properties required by battery and electric vehicle manufacturers.
Four different sites evaluated
Ecograf has evaluated four sites in Dar es Salaam, Kwala, Ifakara and Mahenge for the development of its processing plant. According to the report, the sites in Dar es Salaam and Ifakara are particularly attractive. The company is looking for suitable development sites at both locations and is working on the relevant regulatory approvals.
Dar es Salaam has a well-developed infrastructure, including roads, highways, bridges and rail links. The port of Dar es Salaam is the most important seaport in Tanzania and one of the busiest in East Africa. It serves as an important gateway for international trade and handles a large share of Tanzania’s imports and exports. The port facilitates the transport of goods and raw materials and provides logistical support for industry not only in Dar es Salaam but also in the surrounding regions.
Ifakara is located in the Kilombero District of the Morogoro Region on the banks of the Kilombero River. Ifakara is an important economic and administrative centre in the region and has excellent infrastructure with a direct railway connection to the port of Dar es Salaam. The recently completed 220 kV substation in Ifakara provides a stable connection point to the TANESCO grid.
Tanzania is one of the countries with the lowest energy costs in the world. TANESCO, Tanzania’s state-owned power utility, has an installed capacity of over 1,700 MW, with a significant portion of the base load coming from environmentally friendly renewable sources. Electricity prices in Tanzania are very favourable compared to OECD countries and represent a key competitive advantage for locating energy-intensive grinding and shaping processes in Tanzania. The system reliability of the TANESCO grid is high, especially for industrial consumers.
A recent independent life cycle assessment (LCA) confirms that CO2 emissions during the shaping process can be reduced by about 20% by using Tanzania’s low-cost hydro energy.
Tanzania offers tax breaks for 10 years
Tanzania’s Export Processing Zones Authority (EPZA) for investment incentives grants exemptions from corporate income tax, local taxes, VAT on utilities and exemptions from customs duties on capital goods for up to 10 years.
Conclusion: At least since the Inflation Reduction Act in the US and the Green Deal in the EU, Western governments have been trying to secure supply chains for critical commodities and reduce their risks. On the one hand, it is about diversifying suppliers. But on the other hand, there is also the reclamation of competences along the process chain. The processing, micronisation and shaping of natural graphite is a particularly extreme example, because here the dependence on China is still practically 100 per cent. Tanzania is open to the West and to China and offers enormous locational advantages thanks to favourable energy costs. The country certainly has a great interest in building value creation in its own country that goes beyond the mere extraction of raw materials. Everyone would win if Ecograf could realise its graphite processing in the country.
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