Binding feedstock supply agreement signed with Wogen Pacific
International Graphite Limited (ASX: IG6) has signed a binding graphite feedstock supply agreement with Wogen Pacific Limited (Wogen) to supply natural graphite concentrate to its Collie Micronising Facility in Western Australia.
The agreement is a key pillar of the company’s mine to market strategy. It enables the commencement of operations at the facility without the capital expenditure and operational risks of mining.
Andrew Worland, Managing Director and CEO
“Wogen, in effect, will act as IG6’s sourcing arm while we build our processing operations.”
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Key terms of the Wogen agreement
The announcement outlines the following commercial terms:
- Term: three years from first supply
- Renewal: a further two years, and thereafter a rolling six month period
- Pricing: feedstock prices will reflect market conditions existing at the time of order
The announcement does not disclose volumes or dollar values for the agreement.
| Term | Detail | Investor relevance |
|---|---|---|
| Initial term | Three years from first supply | Sets the base period of feedstock coverage for the Collie Micronising Facility |
| Renewal | Further two years, then a rolling six month period | Provides a path to extend the arrangement beyond the initial term |
| Pricing | Reflects market conditions existing at the time of order | Feedstock costs are market-linked and therefore not fixed |
Because pricing follows market conditions at the time of order, feedstock costs under the agreement are not fixed.
Why feedstock security matters for graphite processors
Graphite concentrate is the mined and processed raw material that micronising plants refine into advanced industrial products. Without a reliable supply of it, a processor cannot operate.
Wogen has extensive experience trading graphite concentrates and has established deep relationships with mining operations globally. Much of the graphite processed at the Collie R&D and Qualification Facility has been secured by Wogen.
The binding feedstock deal follows an earlier non-binding Heads of Terms with Wogen covering micronised graphite sales of at least 3,000t/y into Asia Pacific and feedstock supply of up to 10,000t/y.
For investors, the structure allows IG6 to start and scale up processing without the upfront capital spending and operating risks of mining. Mr Worland said the agreement “secures feedstock for our Collie Micronising Facility from established and reliable producers.”
Path to scale and the Springdale opportunity
Mr Worland said existing natural graphite concentrates supply and existing unutilised mining capacity in Europe, Africa and Brazil will support the start up and expansion of processing plants in Western Australia and Italy. He said this would “provide the most efficient path to cashflow for shareholders.”
The announcement points to the following build-out sequence:
- Secure feedstock via Wogen
- Start and scale up processing at the Collie Micronising Facility in Western Australia and the Alkeemia / IG6 Joint Venture at Porto Marghera, Italy
- Build out processing operations and markets
- Develop the Springdale graphite mineral resource in Western Australia as a source of feedstock supply
By building out the processing operations, IG6 is creating the internal conditions to develop Springdale. The company describes its platform as capital-efficient, with Springdale providing long-term feedstock optionality for future scaling of process operations.
IG6 also states that strong support from the Australian and Western Australian Governments reflects its significance to national critical minerals capability and regional economic diversification. The announcement does not disclose timelines for first supply, production start or cashflow.
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