Syrah Resources Limited (ASX: SYR) announced today its first production of bagged saleable flake graphite from the Balama Project (“Balama”) in the Mozambique northern province of Cabo Delgado.

According to the statement sent to The Mozambique Resources Post, the company reported production of first bagged saleable flake graphite at Balama, with flake graphite in excess of 95% fixed carbon. It also informs that plant construction is essentially complete while its optimisation process is underway.

According to Shaun Verner, Syrah Resources Managing Director and CEO, “this is a significant achievement for Syrah, our subsidiary Twigg, and our host communities in Mozambique as the Company moves into operations. The development of Balama has been achieved through an extremely dedicated construction, commissioning, and operations team, with great support from the local communities, investors, suppliers,
government and other stakeholders. We look forward to reliably and consistently supplying the global graphite market and our planned Battery Anode Material operation with the highest quality natural graphite.”

Mr. Verner also added that “following the intermediate concentrate produced in late October, Syrah has now successfully commissioned the final stages of the flake circuit including polishing, filtration, drying, screening and bagging. Flake graphite produced is within our expected grade range, in excess of 95% fixed carbon.

Remaining commissioning activities will focus on the fines circuit and further optimisation works. We expect our first shipment of flake product from Nacala Port in the coming weeks. First cash receipts are expected in early 2018 with production of 160,000 to 180,000 tonnes1 in 2018, following customer qualification processes.

The company said first cash receipts were expected in early 2018 with production of 160,000-to-180,000 tonnes targeted in 2018.

Syrah expects Balama to be cashflow positive in the first half of next year, with production to reach 250,000-300,000t in 2019.

Credit Suisse, which has been a strong backer of Syrah – including underwriting a A$194 million raising in mid-2016 that issued new shares at $6.05 each – recently modelled earnings (EBITDA) of US$74 million in 2018 and $167 million in 2019.

Syrah acquired the project in late 2011 and has since raised more than A$570 million in equity.

Syrah’s shares today were up 1% to A$4.45 in midday trade, capitalising the company at $1.3 billion.