Blencowe Resources Plc (LON:BRES) has taken a major step forward in advancing its Orom-Cross Graphite Project by securing a groundbreaking US$5 million grant from the United States International Development Finance Corporation, underscoring the Project’s pivotal role in ensuring a dependable supply chain of vital minerals and metals for the United States.
A Game-Changer for Blencowe
The Development Finance Corporation, a vital institution in the US government’s strategic initiatives, has awarded Blencowe a US$5 million Technical Assistance Grant (TAG) to support the Definitive Feasibility Study (DFS) for the Orom-Cross Graphite Project.
The grant reflects the Development Finance Corporation’s dedication to ensuring a stable supply of critical minerals and metals, a key component of the US$1 trillion Biden-renewables strategy, with an initial contribution of US$1 million and additional disbursements tied to meeting predefined feasibility study milestones.
Cameron Pearce, Executive Chairman of Blencowe, expressed his enthusiasm for this partnership, stating, “This funding relationship with the Development Finance Corporation is a unique and game-changing event for Blencowe. We appreciate and value this support and will do everything we can to build their trust within this relationship, to ensure we deliver a high-quality project together.”
A Strategic Asset
The Orom-Cross Graphite Project is unique, as it is the first pre-production graphite project to secure the Development Finance Corporation funding.
With an estimated 2-3 billion tonnes of high-quality graphite, it is one of the largest deposits globally, with considerable long-term appeal to the Development Finance Corporation.
Graphite is a critical material in the production of lithium-ion batteries, and its demand is poised to skyrocket in the coming years, driven by the increasing adoption of electric vehicles and renewable energy storage.
The Development Finance Corporation’s involvement not only covers a significant portion of the DFS costs but also provides a motivated partner for future mine implementation funding.
Furthermore, partnering with a tier one financial institution enhances Blencowe’s credibility and opens doors to potential collaborations with other key players in the graphite market, including end-user original equipment manufacturers (OEMs).
Expanding Project Horizons
One of the most significant advantages of the Development Finance Corporation partnership is the opportunity for Blencowe to consider a larger-scale production strategy.
This could involve building a downstream processing facility in-country to produce high-purity graphite suitable for lithium-ion batteries. Such an expansion could result in a substantially higher Net Present Value (NPV) for the Project compared to the US$482 million NPV projected in the 2022 Pre-Feasibility Study.
Sustainability and Economic Empowerment
The Orom-Cross Project aligns with several of the Development Finance Corporation’s key goals, including sustainability, innovation, green energy, and investment into Africa.
Blencowe aims to deliver a ‘green’ graphite product by utilising hydro-electric power for all mining and processing energy requirements.
This commitment to sustainability is increasingly important in a world where sustainability credentials are audited by OEMs along the electric vehicle supply chain.
Moreover, the Project has the potential to drive investment, empower the Ugandan population, and further develop the Ugandan economy, making it attractive to the Development Finance Corporation’s mission of promoting economic development.
The partnership with the Development Finance Corporation marks a pivotal moment in Blencowe’s journey towards bringing the Orom-Cross Graphite Project to production.
With the financial support, strategic backing, and commitment to sustainability, this collaboration positions Blencowe as a key player in securing a consistent supply of critical graphite for the evolving demands of the lithium-ion battery and renewable energy storage industries.
Cameron Pearce, commented further, “We believe that having DFC as our strategic project partner substantially de-risks Orom-Cross and provides us with the means to deliver a world class project from here. Blencowe presented an excellent US$482 million NPV for Orom-Cross within the Pre-Feasibility Study last year but we are now optimistic that we can deliver an even greater value NPV within the Definitive Feasibility Study as we can significantly expand the project horizons.”
“With the support of the DFC we can address one of the major challenges and risks to any mining operation, being the clear pathway to fund the project into production. We now have the opportunity to build Orom-Cross with the comfort of having a partner with the means to deliver this.”
Mr Pearce added “Graphite demand is rising fast and will continue to do so. It is one of the under-rated but key components of the lithium-ion battery and it is irreplaceable in this regard. As such any future anticipated surge in demand for these batteries, not just for electric vehicles but for energy storage in all other renewable capacities, will continue to accelerate demand for graphite. We now have the means to deliver one of the leading graphite projects in the world and a highly incentivised tier one partner with whom we will work with to do that.”
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