Lincoln Minerals has released a pre-feasibility study (PFS) for its Kookaburra graphite project (formerly known as Kookaburra Gully) situated in the Eyre Peninsula of South Australia, as part of its plan to become Australia’s next graphite producer.
Backed by a mineral resource estimate of 12.8 million tonnes at 7.6 per cent total graphitic carbon, the Kookaburra graphite project is made up of the Kookaburra Gully deposit, the Koppio deposit and the Kookaburra Gully extended prospects.
Kookaburra’s PFS has been developed to leverage the project’s major competitive advantages, resulting in a two-stage, low-capital start-up strategy.
The PFS outlines a staged development for Kookaburra using open-pit mining and a simple floatation process to produce graphite concentrate for exporting outside of China, which introduced restrictions on graphite exports earlier this year.
It also outlines a long-life, low-cost and low start-up graphite project that has potential to maintain solid cashflow margins throughout the metal price cycle once Kookaburra is in production.
Results from the PFS show Kookaburra will have a pre-tax NPV10 (net present value discounted by 10 per cent) of $114 million, a pre-tax rate of return of 41 per cent, average cash earnings before interest, taxes, depreciation, and amortisation of $23 million, and $29 million in start-up capital requirement.
Other highlights from the PFS include:
- average production of 10,000 tonnes per annum of graphite concentrate sales during the first two years, before expanding to 60,000 tonnes per annum in the third year
- low capital infrastructure, with power, water and road sources all being close
- short payback period of 2.4 years from the start of Stage 2 and 4.4 years overall from the start of Stage 1
- current life of mine of up to 16 years
- short approval times as the Kookaburra Gully deposit is already on an existing mining lease
- remaining approvals are well advanced
- low operating cost from the high-grade core that starts at the surface and requires no pre-stripping
- potential to increase project scale and life through exploration targets.
“We are extremely delighted with the results of our Kookaburra graphite project pre-feasibility study, which builds on the previous (feasibility) study completed in 2017 and demonstrates how a two-staged development process can allow us to become Australia’s newest graphite producer and first-to-market by leveraging our high-grade graphite core which requires low capex and no pre-strip to commence production,” Lincoln chief executive officer Jonathon Trewartha said.
“This gives Lincoln a first-mover opportunity which will enhance our ability to secure long-term graphite customers – who are increasingly seeking ex-China graphite supply sources.
“Our staged approach to development will also provide the necessary cashflow to assist with funding the subsequent larger scale and longer life Stage 2 production.”
Kookaburra remains on track to achieve a Stage 1 financial investment decision at the end of 2026, paving the way for construction and first production to commence in 2027.
During that time, Lincoln will progress a bankable feasibility study, government critical mineral incentives programs, approvals, commercial and government investment, all while securing offtake and sales agreements and potential strategic partnering and investment opportunities.
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