Vancouver-based Graphite One is advancing its integrated graphite project in the US, which entails the Graphite Creek mine, in Alaska, and a commercial-scale battery anode materials manufacturing facility in Washington state.

The company on Monday announced the preliminary feasibility study (PFS) for the integrated project, outlining an aftertax internal rate of return (IRR) of 22%, using an 8% discount rate, with a net present value (NPV) of $1.36-billion and a payback of 5.1 years.

The IRR and NPV should improve with the recent enactment of the Inflation Reduction Act in the US, which among other things, offers a tax credit to US producers of anode materials equal to 10% of the cost incurred, starting in December 2022 and reducing to 75%, 50%, 25% and 0% in 2030, 2031, 2032 and thereafter, respectively.

The Act also offers a tax credit equal to 10% of the cost incurred with respect to production of graphite purified to a minimum of 99.9% graphitic carbon by mass.

Graphite One’s production is expected to qualify under the Act for tax credits in both categories, as it plans to produce both anode materials and purified graphite in the US.

The PFS outlines a capital cost of $1.24-billion for the integrated project, with the secondary treatment plant set to cost $661-million and the mine $580-million.

The PFS assumes the secondary treatment plant's (STP’s) operational life is 26 years, based on its startup with purchased graphite and continued operation with graphite from the mine. Over its life, the STP would produce about 75 000 t/y of products, of which about 49 600 t/y would be anode materials, 7 400 t/y purified graphite products and 18 000 t/y unpurified graphite products.

The mine will produce an average of 51 813 t/y of graphite concentrate for the projected 23-year mine life.  The deposit will be mined with conventional openpit mining methods including drilling, blasting, loading and hauling. The process facility will process an average of 2 860 t/d for 365 days a year.

The mine would begin production in the third year of STP operation and begin supplying graphite to the STP in its fourth year of operation. By the fifth year, it is anticipated that Alaska graphite would supply 100% of the STP’s planned natural graphite requirement at full capacity.