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Syrah Resources Testwork Shows Balama Could Be Premium Graphite Product

Syrah Resources' (ASX: SYR) Balama Graphite and Vanadium Project has produced an upgraded graphitic carbon concentrate of 97% from initial metallurgical testwork on a 50 kilogram bulk sample.

The head grade of the sample was 11.2% organic carbon.

Earlier in the year Syrah a concentrate grade in excess of 95%C at a recovery of 87%, with a further regrind test of the finer pebbles performed, providing a graphite concentrate of 97.02%.

The concentrate was: Graphitic carbon 97.02%, Ash 2.24%, Volatiles, 0.16%, Moisture 0.57% and Sulfur 0.01%.

Importantly - the graphite recoveries were very high at around 94%, with Mintek, the laboratory which performed the tests, commenting that chemical upgrading work could demonstrate that the product grade can be enhanced above a 99% concentrate.

Another plus is that ash, volatile, moisture and sulphur levels of the concentrate are very low. 47% of the graphite concentrate was represented by a flake size over 151μm which enables product to be sold into the larger premium end market segments attracting higher prices.

Global graphite

It is worth noting that much of the world's mined graphite has excess levels of impurities such as clays which cannot be easily removed at the mine site.

This graphite is sold to specialist companies at relatively low prices who then proceed to remove the impurities through various heat and chemical processes and on sell the product at considerably higher prices to end users.

Analysis

The Balama deposit has the potential to produce enough graphite to meet any projected shortage in global flake graphite supply going forward.

Another defining characteristic is that the high graphite concentrate grade and low impurities will mean that Balama graphite could potentially be sold for premium prices directly to end users.

Furthermore, if the Balama graphite can be further upgraded to above 99% purity as seems likely, an even higher premium price could potentially be negotiated.

Highlighting the grade of Balama, the very high graphite grades are believed to be among the highest recorded globally.

Today's piece of news adds to the glowing picture emerging at Balama for Syrah, emphasising the still undervalued nature of the stock at current levels

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