Montepuez has one of the highest grade graphite deposits in the world, and there is a huge jump in demand because of use in batteries, particularly for electric vehicles. For example, there is more graphite in a lithium batter than lithium. Graphite is pure carbon in a stable crystal structure that conducts electricity.
Graphite is also used in steelmaking. A new use is expandable graphite as a flame retardant, following cladding fires in London (Grenfell Tower), Dubai (Torch Tower) and Melbourne (Lacrosse Building); during manufacturing, chemicals are trapped between the graphite layers. The graphite expansion initiated from a fire can be more than 100 times its original thickness, resulting in a non-burnable, insulating layer.
Graphite occurs with vanadium, used for strengthening steel, but also beginning to be used in batteries. China is an increasing market for both, but will a predicted to be a net exporter of graphite until 2020 at least, which keeps the price down in the short term.
Mustang Resources will now concentrate on graphite and vanadium in Montepuez, after it put its Montepuez ruby assets into a new ruby company, Fura, in exchange for 8% of Fura. Mustang is 7% owned by Regius, of which former public works minister Felizio Zacarias is chair. Mustang's Caula project adjoins the Balama Graphite Project, owned by Syrah Resources. Syrah, Triton and Battery Minerals are all Australian and have all signed binding agreements with Chinese buyers. Mining could start next year. The small Ancuabe graphite mine was reopened last year by German company AMG.
Triton has three mines - Balama north and south and Ancuabet. A good map of the Triton mines is in http://bit.ly/2w25ujX Ancuabe is 80 km by road from Pemba port and Triton expects to ship 60,000 tonnes per year from Pemba to Europe, it said last month. http://www.tritonminerals.com/wp-content/uploads/bsk-pdf-manager/17_10_17_Corporate_Presentation_HK121_875.pdf
Syrah hopes ship from 380,000 t/y via Nacala, 490 km by road from its Balama mine. The Balama mine has a concession of 106 sq km. But Syrah is producing less graphite and at higher cost than planned, and has replaced its chief operating officer (CEO). Julio Costa, the new CEO, said costs are $430-450/tonne, and that he wants to get the costs down to $400 next year and eventually to below $300. (Zitamar 21 Aug)
All of the companies will export the high quality graphite and vanadium, and there will be no processing in Mozambique. The government gains money from royalties in the short term, but in the long term Mozambique is left with nothing but huge holes in the ground.