Kibaran Resources (ASX: KNL) has kicked off 2015 with an RC and Diamond drill program completed at 100% owned Merelani Graphite Project and mineralisation was encountered at three prospects over a combined strike length of 2-3 kilometres in Tanzania.
Kibaran has the rights to the Merelani-Arusha Graphite Project, located in the north-east of Tanzania while primary focus is on its 100%-owned Epanko deposit, located within the Mahenge Graphite Project.
Discussions have commenced with traders and end-users for further graphite off-take agreements at Merelani.
Negotiations are ongoing with STAMICO-TML Joint Venture to acquire graphite assets and an application for three new tenements to expand Kibaran's position in this graphite province.
Epanko currently has a total Indicated and Inferred Mineral Resource Estimate of 22.7 million tonnes, grading 9.8% TGC, for 2.2 million tonnes of contained graphite.
Merelani is shaping as a second commercial graphite province for Kibaran and could become a source of high quality large flake graphite as demand for that commodity increases.
Discussions have commenced with a number of traders and end-users for further graphite off-take and sales agreements to fully or partly cover future production from Merelani.
Kibaran had signed a Letter of Intent for an off-take agreement for Kibaran graphite with the German company ThyssenKrupp Metallurgical Products GmbH in October 2014, a subsidiary of ThyssenKrupp, to develop an exclusive, long-term commercial agreement for the sale of Kibaran's natural flake graphite products.
The agreement with ThyssenKrupp was for the sale of an initial and minimum 20,000 tonnes per annum of natural flake graphite products in Russia, Korea and the EU 27 - excluding Germany, but including Turkey.
Term of the planned agreement is for 10 years with the integrated materials and technology company.
With 50% of Kibaran's planned graphite production from its Epanko Project under sales and offtake agreements this should underpin the development of Kibaran's Merelani project.
ThyssenKrupp could assist Kibaran to obtain debt or equity funding for development of the graphite projects.
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