Australia-based Renascor Resources has executed a Strategic Cooperation and Offtake MOU with POSCO covering the purchase of 20,000 to 30,000 tpa of Purified Spherical Graphite (PSG) from Renascor’s planned Battery Anode Material operation in South Australia. The final annual amount to be delivered under the offtake and the term of the agreement will be finalized as POSCO and Renascor progress to a formal binding offtake agreement.
POSCO, one of South Korea’s largest conglomerates, is the largest anode manufacturer outside of China, with production capacity of 44,000 tpa and a further 69,000 tpa in construction.
Subject to the satisfactory completion of technical and economic studies, the MOU also provides that POSCO may propose one or more forms of strategic cooperation between Renascor and POSCO (or one of its affiliate companies) which may include an equity investment in Renascor. Any such proposal for strategic cooperation will be at the complete discretion of POSCO, and acceptance of any such proposal is at the discretion of both parties.
If any such strategic cooperation includes a proposal for equity investment that is acceptable to Renascor, such equity investment will be based on the value of Renascor immediately prior to the execution of this MOU. With the MOU with POSCO, Renascor has now executed and announced offtake MOUs covering up to 60,000 tpa of PSG, compared to Renascor’s current Stage 1 PSG production capacity of approximately 30,000 tpa. In addition, Renascor continues to receive a significant volume of inbound enquiry from globally-recognized international groups that are leaders in the battery supply chain.
To fulfil the increased offtake volume requirements, Renascor has commenced feasibility work to facilitate an increase in Stage 1 PSG production capacity and a Stage 2 expansion.
The significant offtake requirements from POSCO represent a transformational step change for Renascor, as the demand from POSCO, together with our existing offtake partners, not only fulfils our current Stage 1 PSG capacity, but also warrants material PSG capacity expansions through an increase of Stage 1 and an expanded Stage 2. The exceptional demand for Siviour PSG is a significant validation of Renascor’s strategy to become one the world’s largest suppliers of low-cost and secure PSG and places Renascor in a strong position as we progress toward binding offtake.—Renascor Managing Director David Christensen
The MOU with POSCO provides the framework for further negotiations in relation to price, term, product quality and other offtake parameters. Under the terms of the MOU, Renascor and POSCO have agreed to work together to undertake additional product validation tests with a view to concluding a formal and definitive agreement for the sale to POSCO of PSG and for potential further strategic cooperation between Renascor and POSCO.
POSCO is a leading global steel company and is the largest single private customer of Australian exports. Through POSCO’s materials manufacturing and supply division, POSCO Chemical Co. Ltd, POSCO is among the world’s largest suppliers of lithium-ion battery anodes and the largest supplier outside of China.
Recently, POSCO has been actively pursuing battery minerals exposure in Australia through transactions with Pilbara Minerals (lithium) and First Quantum (nickel). POSCO’s stated goal is to become the world’s top player in the global electric vehicle battery materials market by 2030 by establishing a value chain from raw material procurement to battery materials production.
Renascor’s vertically integrated Mine and Concentrator and Downstream PSG production facility within the Electric Vehicle supply chain.
Renascor is developing a vertically integrated graphite mine and manufacturing operation to produce sustainable and ethically-sourced battery anode material for the lithium-ion battery market. Renascor’s operation will combine:
Siviour Graphite Deposit in South Australia, the largest reported graphite Reserve outside of Africa; and
A state-of-the-art processing facility in South Australia to manufacture purified spherical graphite.
Renascor’s aim is to become a leading supplier of 100% Australian-made and low-cost purified spherical graphite for lithium-ion battery anode makers worldwide.