RE: #TGR Analysis, some Q & A for those doing DD14 Jul 2023 07:51
3. TGR has been quite confident in voicing that it will review BAT’s figures and revise them to suit TGR’s capabilities and the long-years of experience of management in dealing with Hard rock Graphite resources. They’ve said the work done to date at Montepuez on the ground (groundwork, basecamp, crusher, drainage, tailings-dam work etc) has already saved about £10m going forward. Hard to know exactly until TGR publishes its figures but so far in Madagascar its proven itself to be an industry low-capex:production capacity producer - spending only c.£11m in Madagascar on actual Capex to bring 30,000tpa of production online (attached pic from TGR presentation as well). The first stage at Monetpuez is proposed at 50,000tpa and is construction started so am v looking forward to what the company can come up with in its revised plans, albeit much will depend on if TGR goes for the full 50,000tpa to start or another first stage target for example. Opex-wise achieving higher grades with lean processing circuits is TGR’s bread and butter as is becoming more apparent in Madagascar despite the saprolitic clay material there.
Mozambique is hard-rock and similar to previous projects in India operated by management I believe, and with innovations in processing units demonstrated so far in Madagascar I would hope we can expect reduced opex figures for Mozambique in the revised plans too.
4. I am unsure quite at what scale TSG’s tech is ready for application - however it had been hoped according to the IPO prospectus and the April 2021 fundraising before the adverse weather at the beginning of 2022 and the current TSG impasse was reached that, among the large-scale integrated downstream unit that was initially planned for expansion in India, a 3,000tpa unit was going to be targeted for HF acid-free spherical graphite - considering Syrah’s initial plant in the US is targeting c.11,000tpa and using HF acid, that is ambitious and contributes to why investors were/are very keen to see progress on the downstream front. Again though, until we hear more about the TSG/downstream situation from TGR it’s just speculation what ultimately may occur, however the company has made noises in interviews about targeting the UK and elsewhere for downstream capacities. There are certainly growing incentives to build capacities in various locations globally. I believe initially though these plants would not be located in Madagascar/Mozambique owing to the additional technology and infrastructure requirements, hence the more developed economies with established infrastructure, tech and labour etc are probably preferences.
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