Mineral Commodities in $4.6m graphite deal

Welshpool-based Mineral Commodities has signed an agreement with Gold Terrace to earn-in to the Munglinup graphite project West of Esperance in a part-cash, part-scrip deal worth about $4.6 million.

Under the deal, Mineral has secured a majority position in Munglinup, with a 51 per cent stake.

Mineral can earn a further 49 per cent of the project by passing a number of thresholds, including a feasibility study and further share issues.

In the initial deal, Mineral will pay Gold Terrace $3.2 million cash, and issue 10 million shares to Gold Terrace.

Mineral executive chairman Mark Caruso said the company considered the asset world class.

“Munglinup is consistent with Mineral’s high grade industrial mineral operating profile and compliments Mineral’s Tormin Mine high grade mineral sands operation,” he said.

“Munglinup presents an excellent near-term development opportunity to enter the growing battery commodities market at a time of future demand and production uncertainty, mainly due to unfavourable mining industry regulatory changes in Tanzania and Mozambique, and tightening of Chinese supply.

“Munglinup is one of the highest grade coarse flake graphite deposits in the world and is near excellent infrastructure.

“The deposits are open along strike and at depth and contained within an approved mining lease.

“Mineral will be looking to bring Munglinup into production as soon as possible to take advantage of a looming coarse flake graphite supply shortage.”

Mineral shares were up 16.7 per cent to 14 cents each at the close of trading today.