United States Welcomes New Deal in Graphite Production Between POSCO and Black Rock Mining

United States Welcomes New Deal in Graphite Production Between POSCO and Black Rock Mining

The United States has welcomed a new deal between South Korean steel giant POSCO and Australian mining company Black Rock Mining (BRM), which aims to advance the development of the natural graphite supply chain by supporting the expansion of the Mahenge graphite mine in Tanzania (1). This collaboration among Minerals Security Partnership (MSP) members and private sector players underscores the MSP's capacity to facilitate secure and diverse critical mineral supply chains, bringing economic benefits to local communities and countries rich in these materials.

The Mahenge project, located in Tanzania, is expected to significantly increase the global supply of natural graphite, a crucial component in lithium-ion batteries for electric vehicles, solar panels, and various other applications (1). This project is of particular importance, as it is one of the few large-scale graphite projects outside of China to secure a commercial and long-term off-take agreement with a major battery manufacturer like POSCO (2).

BRM announced on May 29 that it had secured a $100 million graphite off-take deal with POSCO's 60%-owned battery business, Posco Future M. Under the terms of the agreement, BRM will repay the $10 million upfront by supplying graphite flake from the Mahenge project (2). This investment will help BRM advance the development of the Mahenge project and move into commercial production.

POSCO's chief executive officer, John de Vries, expressed his confidence in the high-value and commercial nature of Mahenge's graphite product, stating that it will be sold as a qualified product into consumer markets under a long-term offtake contract (2). This agreement is expected to strengthen and diversify global supply chains for graphite across various markets.

The successful collaboration between POSCO and BRM on the Mahenge project demonstrates the potential for the MSP to foster partnerships between its members and the private sector to address critical mineral supply chain challenges, secure energy sources, and promote economic growth.

Sources:
[1] United States Welcomes New Deal in Graphite Production Between POSCO and Black Rock Mining. (2023, February 1). Retrieved from https://www.state.gov/united-states-welcomes-new-deal-in-graphite-production-between-posco-and-black-rock-mining/
[2] Black Rock secures $100m graphite offtake deal with POSCO. (2023, May 29). Retrieved from https://www.fastmarkets.com/insights/black-rock-secures-100-graphite-offtake-deal-with-posco/