We have seen a surge in companies positioning themselves for the rise of the lithium battery industry. For example, lithium mining company Galaxy Resources Limited (ASX: GXY) has seen a 56.5% rise in share price in year to date trading. Other metals required for cathodes include manganese, mined by South32 Ltd (ASX: S32), also nickel and cobalt, currently being developed by Ardea Resources Ltd (ASX: ARL). Nevertheless, one of the few listed Australian miners focused on graphite, the anode material is Ecograf Ltd (ASX: EGR).
Image source: Getty Images
What is moving EcoGraf ASX shares?
In the past week, EcoGraf ASX shares rose by 72.414%. The company has two bases of operation. First, in Tanzania it is developing The Epanko Graphite Project. This is a long life, highly profitable graphite project. It is forecast to produce 60,000 tonnes / yr of natural flake graphite products.
Second, the company is developing a processing plant in Kwinana, Western Australia. This will to produce spherical graphite using a new eco-friendly process to sell directly to lithium-ion battery manufacturers. The plant will draw both from recycled battery materials as well as graphite flak products from the Americas, Asia and Australia.
Over the past 6 months it has had a succession of very promising and positive releases. For example, it recently reported solid results from its proprietary purification process to recover high purity battery anode material from lithium-ion battery materials. Furthermore, it has also provided electrochemical analysis supporting the claim that battery products uniquely positioned as a superior and cost competitive material for battery anodes.
EcoGraf has already had a lot of positive support from the West Australian government. The company believes that it can deliver a plant in Kwinana within 11 months of a final investment decision.
Foolish Takeaway
EcoGraf ASX shares currently value the company at $54.6 million. It appears to have a pathway top funding in Tanzania as well as in Kwinana. The management team includes several resources professionals with a solid track record of bringing in large scale developments.
With no funding secured, the company remains a speculative play. However, EcoGraf has an experienced leadership team, and is starting its development stage. I think this could be a great growth story in the battery business over the next few years.
