FLAKE GRAPHITE INDIAN OVERVIEW TIRUPATI GRAPHITE - BRIDGING THE GAP

Transcription

1 Presentation by SHISHIR KUMAR PODDAR, MANAGING DIRECTOR, TIRUPATI CARBONS & CHEMICALS (P) LTD. FLAKE GRAPHITE INDIAN OVERVIEW TIRUPATI GRAPHITE - BRIDGING THE GAP

2 Overview of the presentation Brief on my presentation at The Graphite Conference Indian Flake Graphite Resources and Exploitation A Brief. Forecast on Indian Flake Graphite Production and demand. Tirupati - An Overview Our Flake Graphite Resources an update and next steps Technological developments & Capabilities. Our Planned Flake Graphite output & Markets, year wise. Financial Strengths. Vision on Developing Partnerships Around the Globe Key to Survival for Upcoming Flake Graphite Projects : Our views.

3 Brief on my presentation at The Graphite Conference By organizing The Graphite Conference 2011, Industrial Minerals provided a fantastic platform for interaction amongst the Natural Graphite industry and its users. This conference came up at a time when there were growing concerns on near total dependence of the world on China, for its Graphite requirements, in wake of changing circumstances in China. Having worked in the field of Mining & Processing of Natural Graphite since more than 2 decades, surviving the tough times for Indian Flake Graphite Industry, it was my privilege to present before the august gathering of the last Conference, a detailed evaluation on Natural Graphite resources in India, status of their exploitation and a brief on our company and its endeavors in the field. In my presentation today, with a short and updated review on India s resources, I shall take forward my view that India is a promising and upcoming source for this vital mineral of strategic importance, and appraise this august gathering, of our companies' resources, capabilities & plans.

4 Flake Graphite Resources in India India has fairly widespread deposits of Flake Graphite totaling about 175MT as indicated below. Of these, Commercial exploitation is presently carried out only in the states marked in Green. Jammu & Kashmir MT Rajasthan 1.91MT Gujarat 3.35MT Maharashtra 1.16MT Karnataka 0.07MT Kerala 1.58MT Arunachal 72.75MT Jharkhand 12.91MT Orissa 8.67MT Chatishgarh 1.01MT Andhra Pradesh 0.43MT Tamilnadu 8.24MT

5 Flake Graphite Exploitation in India A Brief. India has been mining & processing Flake Graphite for more than 5 decades, and possesses state of the art processing technology. Processed Graphite output is presently about 35KTPA, of which more than 90% is consumed in the Indian market. We are still net importers of Flake & Microcrystalline Graphite, with imports constituting another 15KTPA. Mining and Processing of Flake Graphite is in vogue in three states, Orissa, Jharkhand and Tamil Nadu, mainly by 4 companies, Tirupati and Chotanagpur belonging to our family, Agarwal Graphite Industries in Orissa and Tamil Nadu Minerals Ltd. With modifications in Environmental laws for small mines, there was a fall in output during the current year, which is again on the rise with required clearances being granted. New capacities are under creation by us, Chotanagpur & Agarwal and from 2014, Indian output shall exceed the local demand making India a net exporter of Flake Graphite. In this background, the estimations on Indian Flake Graphite output and consumption are as following:

6 Flake Graphite Output KTPA Indian Flake Graphite output forecast for next 4 years Tamilnadu Orissa Rest of Jharkhand Tirupati

7 Consumption KTPA Estimated Indian Consumption of Natural Graphite Others Lubrication Friction Mtls Foundry Pencils Crucible Refractory

8 Tirupati - An Overview With our companies mission of being a global player in the field of Flake Graphite, we started our operations with a facility to mine & produce 4000 TPA Natural Flake Graphite, commissioned in November Simultaneously, we also started exploring & developing Mineral Resources & processing technology, building relationships & partnerships around the globe and developing financial strength to pursue our growth plans to achieve 40KTPA output by We now have the following in place, to further the mission: Three Mineral Resources with aggregate Reserves of 6.1 Million Tones, further Exploration in progress, and expertise in mining of ROM Graphite ore. State of the Art Processing Technology achieving >96% purity by flotation process, and Environment friendly Technology for purification of processed Graphite to >99.5% purity, without the use of HF. Developing relationships in Flake Graphite market place in India and around the Globe. Road Map with Time lines for achieving an output of 40KTPA Flake Graphite, with solutions for every application of this vital Mineral. I now proceed to finer details on our resources and plans

9 Update on Tirupati Graphite Resources We presently holds 3 Concessions for Flake Graphite : Rabda Graphite Mine Gaura Graphite Mine Ekta Graphite Mine Detailed Exploration of Rabda Graphite mine was done early 2010 and the mine has been under commercial operations for the last over 2 years. During the last one year, detailed exploration and development of Mining Plan for Gaura & Ekta mines have been concluded, with better than expected findings in respect of both Quantity and Quality of deposits in the areas. The Consolidated and classified mineable reserves established in the three areas, up to a depth of 50M below GL confirmed by core drilling, are > 6 Million Tones,. Three more deposits in the vicinity of our present working have been identified and applications for grant of Concessions for these areas are under consideration by our Government. I now proceed to dwell in detail on the deposits we are presently working:

10 Rabda Graphite Mine Resource Size : As per Classification under United Nations Framework Classification of Mineral Resources, the presently approved reserves in the area is 1.8 million tonnes, up to a depth of 50M below GL. Based on available data and our Geological assessments, the reserves estimated are > 4Million Tonnes up to 100M depth. Flake Size : Rabda is a medium Flake mine with + 100# about 25% at surface and increasing to >35% at 30M from GL. Grade : The purity of the deposit in the mine ranges from 8 11% FC content with an average of about 9.5%. Capabilities : The mine is being worked at an output of 30KTPA presently and is developed for 50KTPA yield, ie 30% of our requirement from Q Its assessed capability is that it can be developed to a yield of up to 120KTPA. However, since the quality of Resources at the other two mines are superior, we have restricted the plans for this area to 50KTPA yield. Geological and Development plan of the area follow

11 Geological & Mine Development Plan of Rabda Graphite Mine

12 Gaura Graphite Mine Detailed Geophysical & Geochemical assessment, and preparation of Mining Plan for this area was completed in August The results obtained are: Mineable Reserves : 0.8 Million Tones up to 30M below GL Grades : Ranging from 10 30% in different veins and at different depths. Average Run Of Mine Purity : 15% Flake Size : Medium size with >30% +100# Full scale development & Mining operations of the mine ha been started from Sept 2012 and output is being processed at our facility for two months now. Planned Output : The mine is being worked at an output of 20KTPA presently enhancing to 35KTPA ie 20% of our requirement from Q The assessed capability of the mine is that it can be developed to a yield of up to 50KTPA. Since this mine is yielding higher purity ore, it is positively contributing to increasing our revenues and profitability already.

13 Geological & Development Plan Gaura Graphite Mine. A SMALL MINE WITH HIGH PURITY DEPOSIT MULTIPLE VEINS EXTENSION OF THIS DEPOSIT UNDER AQUISITION

14 Ekta Graphite Mine Ekta is, by far, the Best Deposit out of the three areas we presently have. Detailed Exploration and Feasibility study for the area has been performed in terms of Field Guidelines for adaptation of UNITED NATIONS FRAMEWORK CLASSIFICATION FOR MINERALS. In brief, the following studies were performed: Surface Topographic & Geological studies. Trenching & Pitting for determination of strike line, length & width of Graphite veins. Core drilling for determination of continuity of the mineral deposits and Mineral sampling at different depths. Geochemical survey and analysis for qualitative determination of the mineral deposits. Mineral Characterisation, Beneficiation studies & Development of Process Flow sheet for producing >96% purity Flake Graphite by flotation.

15 The results obtained, in brief are: The area has a hitherto unseen concentration of Graphite veins in close proximity. The purity of the deposit ranges from 12% to 16% FC, with an estimated average ROM Graphite content of 14%. The cross sectional width of Graphite veins discovered in the area at 5M below GL totals more 150M. The total reserves estimated as per UNFC guidelines unto a depth of 50M below GL proven by core drilling, is >3.5 Million tonnes. Beneficiation trials have established that the mineral can be beneficiated to a purity of >96% FC in lesser stages than that from the other sources we have. We are now in the process of preparation of mining plan for the area with Run of Mine output of 80KTPA starting Q and increasing to 150 KTPA in accordance with our increased ROM requirements. Geological plan of the area follows

16 Geological Plan Ekta Graphite Mine High width Veins High Purity Mineral Extension Being Explored

17 Medium Term Resource Outlook & and further Explorations For achieving Processed Graphite output of 40KTPA by 2016, the Run of Mine Graphite Ore required is 400KTPA. The existing areas available with us are assessed to be capable of yielding 250KTPA Exploration of more deposits in the area we are working in has been conducted, and our applications for grant of mineral concessions on 3 new deposits are now under consideration of our State Government. These deposits are located in Halumand, Pochi, Hurmur and Gaura villages, with local geology similar to our present resources, showing surface outcrops of Graphite veins on hillocks. To diversify our geographical area of operations, after study of available geological reports and field visits, we have started field investigations for location of deposits in Andhra Pradesh Province, adjoining borders of Orissa state where deposits are in commercial operations. These activities are being performed for achieving a Resource base of >20 Million Tones within Q Estimated ROM Graphite Ore output by 2016 follows

18 ROM Graphite Ore Output KTPA Estimated ROM Graphite ore output New Areas Ekta Gaura Rabda

19 Technological Developments & Capabilities. Our efforts of Technological Development are directed towards developing cost effective Manufacturing Technology for manufacturing Flake Graphite products for all commercialized applications. We are presently not working on, or competent to develop new products and applications of Flake Graphite like Graphene Applications. The specific objectives and results obtained are: Objective : Developing Optimized Processing Technology for Purification of ROM Graphite Ore from different mining areas to a purity of 96% Fixed Carbon by physical separation methods, and design, Engineering and manufacture of equipments for facilities of planned capacity. Results : ROM from all the three mines, and combinations of these processed to 96% FC purity, duly retaining Flake size to > 80%, and with Recovery exceeding 87%. Compact, online, low investment high efficiency plant with 12000TPA capacity designed and under construction. Objective : Development of Eco friendly technology for purification of processed Flake Graphite to >99.5 and up to 99.95% purity. Result : Without use of HF, purified product of >99.5% achieved. Tests & Trials are in progress to achieve >99.95% purity. Though not yet achieved, positive results are expected over the next 3 months.

20 Technological Developments & Capabilities (Contd.) Objective : Development of size reduction process and expertise to achieve micron size particles in purity & distribution as required for different applications, and development of Colloids and suspensions. Results : size reduction up to < 5 micron achieved. Trials are on for achieving <2 Microns. Sub micron size shall be worked upon thereafter. Objective : Development of Spherical Natural Graphite for LiB Results : The Technology is simultaneously being developed in association with two world leading companies engaged in the manufacture of Anode Material for LiB. The vital achievements so far are: NSG with properties superior to that manufactured with Flake Graphite from Chinese sources has been successfully manufactured and put in product application. Contrary to belief in some parts of the world, this NSG has been manufactures by using small size Natural Flake Graphite. Based on our Resources and Technological Capabilities, I will now dwell upon the planned output and markets we will work upon:

21 Output Tones per Annum Flake Graphite output by purity >99% 95-96% 90-94% Up to 90%

22 % Share in Total Sale Markets by end use (%) Others LiB & Energy Storage Lubrication Exfoliated Friction Materials Pencils Refractory Foundry

23 % Share in Total Sale Markets by Location (%) Others America Europe Japan India

24 Capex Plans for New Facilities : For setting up the planned Manufacturing facilities as forgoing the Capex outlay for these facilities are as below: 1. Expansion from 4 16 KTPA Under Construction, Completion Q CAPEX - INR 150 Million USD 3 Million 2. New Facility for High Purity Flake Graphite for LiB and other Applications Start Q Complete Q CAPEX INR 200 Million USD 4 Million 3. New integrated Facility for all Grades of Flake Graphite, including energy storage, with Capacity 24KTPA Start Q Complete Q CAPEX INR 750 Million USD 15 Million I proceed on our Key Financial Strengths for achieving the growth plans

25 Key Financial Strengths We are a company fully owned within our family at present. The Financial strengths we have developed over the last 2 years are: Creating Mining & Processing Facilities at low capital cost : 4000TPA facilities for Flake Graphite created at a Capital cost of INR 50 Million USD 1.0 Million TPA facilities for Flake Graphite being created at a Capital cost of INR 150 Million USD 3.0 Million. CAPEX for further expansion plans stated earlier will also indicate lower cost for creation of facilities as compared to other parts of the world. Manufacture of Flake Graphite at low operating costs. Term Debt raised for setting up of 4000TPA facilities have been fully repaid in 2 years against 5 years scheduled. FY recorded a Tax Paid EPS of 310% of face value of shares of our company.

26 April Sept 2012 Tax Paid EPS was 300% of face value of shares, annualized being 600%. Present Expansion to 16KTPA capacity is being done without raising equity from external sources. Additional equity required is induced by our promoters and Term Debt of INR 100 Million has been raised from Indian Financial Institutions. Post expansion, the Tax Paid EPS is estimated to be >15 times the face value of shares of the company, with increased equity. With available resource base, facilities created & being created, favorable business conditions of Flake Graphite industry, global alliances being forged ahead, Technical Competence in the field, & cost effective operations of the company, we are fairly placed to raise equity from external sources ie capital markets of India or international markets, or through techno commercial Associations or JV s for our expansion plans from 16KTPA to 40KTPA.

27 Our Vision for Global Alliances: Natural Resources are set to become key growth drivers around the Globe. Flake Graphite is entering a new era with realization of potential new applications of this material with diverse properties. To be a leading global player in the Flake Graphite market space, we shall pursue alliances with the following objectives: Being a preferred source to World Class users of the material, in the entire spectrum of its applications. Developing resource base in countries outside India. Developing Techno Commercial alliances for value added applications in Energy storage, Graphene and Composites. Building Partnerships with companies in the field of marketing Flake Graphite in Japan Europe and United States on a mutually beneficial basis.

28 Key to Survival for Upcoming Flake Graphite Projects : Our views. With change in the Flake Graphite situation from China, increase in Chinese export prices 2-3 folds, and possibilities of new applications increasing demand, there has been a rush of New Companies Exploring Flake Graphite resources in different parts of the world. The present world consumption of Natural Graphite is estimated at less than 1 Million Tones. The questions that arise are: How much additional Flake Graphite capacity is required, to meet demand in conventional applications. What will be the incremental demand in new applications. How much additional Flake Graphite capacities are under planning and / or creation in various parts of the world. The Growth in consumption of Flake Graphite in LiB Batteries until now has been far less than what was anticipated about 2 years back. Commercialization of Graphene applications are still a distant reality. Growth in conventional applications shall mainly be driven by steel, which has been depressed world over during last one year, but may now look up.

29 In the background above, we can be confronted with two situations A. There is a surge in Global Demand, with EV s and other energy storage applications picking up in high growth mode, Graphene applications being commercialized in near future etc In this case most of the projects shall see good times. B. Growth of demand is low In this case, projects with Early start of commercial operations Low investment per unit of capacity created Balanced operating costs, to meet Chinese competition Diverse product range to serve the entire spectrum of applications Global associations with end user industries Balanced operating conditions and minimum basic commercial infrastructure WILL HAVE AN EDGE

30 My Sincere Thanks To Industrial Minerals for inviting me. All distinguished speakers, Delegates, Media Representatives and all present. My team, who have worked for building our company block by block and on making this Presentation. Shishir & Team Tirupati