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South Star Battery Metals (TSXV: STS) has substantially completed the Phase 1 construction of its flagship Santa Cruz graphite mine located in Bahia, Brazil, the company announced Monday.
Commissioning of the mine is now underway, with commercial production scheduled for September of this year. The Vancouver-based graphite miner plans to fulfill initial purchase orders as early as the fourth quarter.
The infill drilling and short-term mine plan/sequence for the first quarters of the operation are complete. Pre-strip is finalized and approximately 50,000 tonnes of ore will be placed on the ore pad in August 2024, South Star said.
The mine plan confirmed simple, open pit mining of oxide ore with at-surface mineralization. Large-scale pilot-plant testing had been completed, showing approximately 65% of graphite concentrate is +80 mesh with good recoveries and 95%-99% graphitic carbon (Cg).
The Phase 1 plant has the capacity to produce approximately 12,000 tonnes per year of natural flake graphite concentrates. This would make Santa Cruz the second-largest producer in the Americas, as well as being the region’s first new graphite mine in nearly 25 years.
“We are pleased to have achieved this important milestone of substantial completion of the Phase 1 construction and continue advancing towards ramp-up and commercial production,” South Star CEO Richard Pearce said in a news release.
In 2026, the mine will move towards Phase 2 with a larger-scale plant that is planned to produce between 25,000-30,000 tonnes of concentrate per year. The third and final phase is targeted for 2028, producing about 35,000 tonnes a year. Environmental approvals for both phases are in place.
According to a 2020 pre-feasibility study, the Santa Cruz operation will have a life of 12 years with a post-tax net present value (at 5% discount) of $81.2 million and an internal rate of return of 35%. The capital costs for the Phases 1 and 2 are estimated at $8 million and $27 million respectively.
