Sarytogan Graphite has secured a $5 million investment from a major European project financing bank through a 16c placement aimed at funding the development of the company’s graphite project in Kazakhstan.

The timely cash injection from the European Bank for Reconstruction and Development has come ahead of a looming prefeasibility study (PFS) on Sarytogan’s high-grade project that sits 400km south-east of Astana in Kazakhstan’s Karaganda region.

The EBRD mainly promotes green entrepreneurial initiatives in free-market economies outside Europe. Since its creation in 1991, the bank has invested more than €200 billion (AU$331 billion) in 7000 projects across three continents, of which 80 per cent has been pushed into private sector businesses.

EBRD director of natural resources Natalia Lacorzana says Sarytogan’s project is the first graphite development it has funded. It recognises the importance graphite plays as a critical metal in the development of a global transition to a green economy, especially in the adoption of electric vehicles (EVs).

The investment will be made in two tranches, with 16.5 million shares to be issued in October and a further 14.75 million shares in December at 16c each – representing 17.36 per cent of the company’s register. The second tranche is contingent on approval from the Australian Foreign Investment Board.

Sarytogan Graphite managing director Sean Gregory said: “The investment follows extensive technical and legal due diligence by the bank and we see it as a ringing endorsement of the governance of the Company and the quality of the Sarytogan Graphite Project. We share an alignment of strategic objectives to power the green economy by developing the Sarytogan Graphite Project with the highest standards in governance and environmental performance.”

‘We see it as a ringing endorsement of the governance of the Company and the quality of the Sarytogan Graphite Project.’

Sarytogan Graphite managing director Sean Gregory

The Sarytogan graphite project contains a massive 229 million-tonne resource running at a grade of 28.9 per cent total graphitic carbon (TGC) with a purity of 99.9992 per cent – known as the lofty “five 9s” standard – in the mineralisation. Since releasing its maiden resource estimate two years ago, Sarytogan has also conducted metallurgical tests that confirmed an 84.4 per cent recovery rate and achieved a concentrate grade of 81.4 per cent.

On the back of the results, the company then pushed on with a PFS, which is due for completion imminently. The study is looking at the potential to produce three distinct products totalling 50,000 tonnes per annum, with a focus on smaller modular processes that can be easily copied to expand production in the future.