Volt Resources has appointed international investment banking firm Exotic capital to raise US$30 million for its Bunyu Graphite Project in Tanzania, moving towards production by year-end 2018.
Exotix Capital is to undertake a Tanzanian bond issue to raise equity of up to US$30 million in structured debt, to fund the stage one development of the project.
The proposed bond financing will ensure that project development funding will be undertaken with minimal equity dilution.
Graphite is increasingly in demand because of its variety of uses, including as a fire retardant in building materials and for use in batteries for powering electric vehicles.
The manufacture of lithium-ion batteries used in electric vehicles requires nine times more graphite than lithium.
By 2020, analysts estimate the demand for flake graphite will exceed 500,000 tonnes per annum, largely due to an approximate 400% increase in battery graphite feedstock demand from 2016.
Volt’s Banyu Graphite Project is the largest JORC mineral resource deposit in Tanzania and can produce graphite suitable for both battery production and building material uses.
As part of the proposed bond raising process, Volt will, upon completion, have the bonds listed on the Dar es Salaam Stock Exchange (DSE). The estimated timeframe to complete a DSE listing is 8-12 weeks.
“Exotix brings to the table an extensive network of East African investors and a comprehensive strategy to access these local parties who have a strong appetite for large-scale resource projects such as Bunyu,” said Volt’s Chairman, Asimwe Kabunga.