NextSource Materials (TSX:NEXT) (OTCQB:NSRCF) is now one step closer towards critical minerals producer status, having initiated the commissioning of its Molo graphite mine in Madagascar. Installation of the solar and battery facility for the hybrid power plant is underway.
The hybrid power plant is central to the Phase 1 development at Molo. It consists of a thermal generation facility, which is already in operation, and a solar and battery facility, consisting of a 2.6MW solar PV facility and a 1MWh battery energy storage system.
The thermal facility currently supplies all of the plant's power requirement, and once completed, the solar and battery facility will provide up to 33% of the mine's total electricity needs using renewable energy. According to NextSource, this hybridized power solution is expected to reduce CO2 emissions by over 11,300 tonnes per year.
"Commissioning of the Molo graphite mine is a testament to the hard work and perseverance of our employees and contractors who have brought this project from design through to implementation in the midst of a global pandemic and shifting geopolitical landscape," CEO Craig Scherba commented in a news release.
"That hard work has placed the company in an enviable position as it transitions into a global graphite producer at a time when graphite consumption is increasing dramatically due to the explosive growth in demand for lithium-ion batteries," he added.
During the first phase, the Molo mine will initially produce approximately 17,000 tonnes of flake graphite concentrate per year. A Phase 2 expansion has also been planned, which could elevate Molo's annual graphite production to 150,000 tonnes.
With aims of becoming a vertically integrated battery materials supplier, NextSource recently announced its global battery anode facility (BAF) expansion strategy, which involves building multiple BAFs globally that would be capable of turning its graphite concentrate into commercial-scale anode material.
Concurrently, the company published results of a technical study for its first BAF (BAF1) located in Mauritius. Mauritius was selected due to its close proximity to the Molo mine and its position on strategic shipping routes to key markets, in particular Asia.
Front-end engineering and design and environmental and social impact assessment (ESIA) permitting are currently in progress, and the graphite developer said it is in "active discussions" with strategic offtake partners and debt and equity financiers who have expressed an interest in funding the BAF1 construction.
Subject to obtaining the necessary funding and completion of the ESIA process, NextSource is targeting production from facility in Q2 2024.
Shares of NextSource Materials shot up 5% by 11:50 a.m. Toronto time. The company has a market capitalization of $288.7 million.