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Graphite

Natural graphite is a metallic steel-grey coloured mineral, composed entirely of elemental carbon in a crystallised form. Graphite is a good conductor of heat and electricity and has the highest natural strength and stiffness of any known material. It is also the lightest of all reinforcing agents, and has a high natural lubricity. Graphite occurs in metamorphic rocks as a result of the reduction of sedimentary carbon compounds during metamorphism, some graphite occurs in igneous rocks, and  can also form as a result of thermal metamorphism of coal.

There are three principal types of graphite:

  • Flake graphite occurs as flat, plate-like particles in metamorphic rocks.
  • Lump or vein graphite occurs in veins, as massive platy intergrowths and is hydrothermal in origin.
  • Amorphous graphite occurs as fine particles and is formed by thermal metamorphism of coal. Very fine graphite is also often referred to as amorphous.
     

World Reserves and Production
World reserves of graphite are estimated at 77Mt (2011), the largest known reserves are located in China (55Mt) and India (11Mt). World production in of graphite in 2011 was 925 000t, with China being the largest producer (600 000t), followed by India (140 000t), then Brazil (76 000t).

Deposits
Uley Graphite Project (South Australia): Mega Graphite’s recently acquired Uley project is situated on the Eyre Peninsula, South Australia. High grade flake graphite mineralisation occurs in complexly folded and faulted Proterozoic schists and gneisses. Discovered in the 1910’s and worked intermittently since the late 1920’s, the plant was capable of producing  14 000tpa of graphite concentrate. The mine has been out of operation since 1993.

Kringel Graphite Mine (Sweden): Flinders Resources recently acquired Keingel mine, in central Sweden, it was operational from 1996-2001, producing 40% large flake, 28% medium flake and 32% fine graphite. It is now being evaluated for restart of production due to higher graphite prices since 2009. It has a historic resource of 6.9Mt containing 8.8% graphite, in 4 deposits. The resource is sufficient for 30 years at full production of 13 000tpa graphite.

Applications

  • Refractories - Graphite is used in the construction of steel refractories, such as magnesia-carbon bricks (25% graphite) for lining steel-making furnaces.
  • Steelmaking – Graphite is used for carbon-raising in molten steel.
  • Batteries and Lithium-ion batteries – graphite is required to construct the anode of all major batteries. A significant amount of graphite is required for Li-ion batteries, which are now being used in hybrid and electric vehicles.
  • Fuel cells – Proton exchange membrane technology in fuel cells requires large quantities of graphite.
  • Electrodes for electric arc furnaces.
  • Carbon brushes in electric motors.
  • Lubricant –Powdered graphite is used as a solid lubricant and is added to oils or to polymer coatings.
  • Breaks and clutches – Graphite is used in brake drums, break pads and clutches in the automotive industry.
  • Graphite foil is used for manufacturing high temperature gaskets and packages.
  • Carbon Fibre Reinforced Polymer Composites for components in automotive, marine, aerospace and sports products.
  • Pebble bed nuclear reactors – A PBNR is a small modular nuclear reactor with a number of advantages over large traditional reactors, they use uranium fuel embedded in graphite balls.
  • Pencils – Low quality amorphous graphite is mixed with clay and used for pencil led. Around 4% of world production is used for pencils.


Market
The posted price for graphite provides a long term guideline for pricing trends; however transactions are largely based on direct negotiations. Prices of graphite vary according to flake size (larger flake sizes are more valuable) and purity. Pricing of graphite crashed in the 1990s as Chinese producers flooded the market. During this period, little exploration was carried out and as a result there are few projects in the development pipeline.
The graphite market began to recover in 2005, and world demand increased during the second half of 2009, continuing to increase steadily throughout 2010 and 2011. Global consumption has increased from approximately 600 000t in 2000 to 1.1Mt in 2011. Demand from Brazil, Russia, India, China and emerging economies grew at approximately 5% per annum between 2000-2010. China produces over 70% of world graphite, mainly in a low-carbon powder or small flake form. The Chinese government has recently begun tightening controls over mines and consolidating the industry, this could result in a 10% loss of annual global graphite supply. Graphite may be in a sharp supply deficit in the next few years with prices rising significantly.