The Molo Flake Graphite Project

The Molo Deposit located on the Green Giant Property in South Central Madagascar .
>Green Giant Graphite 
Satellite image from space showing the Molo footprint. Red area represents the area that will comprise of our NI 43-101 resource. 

The Molo all-flake graphite deposit is located near the village of Fotadrevo in southern Madagascar and is 100%-owned by Energizer. The deposit is situated 160 kilometers (km) southeast of the city of Toliara, in the Tulear region of southwestern Madagascar and 220 km NW of the port town of Fort Dauphin.

The deposit is immediately at surface, with little to no stripping requirements and easy access to site by both road and by air, via an all-weather, year-round airstrip adjacent to the property. The Molo flake graphite deposit is located in a dry savannah grassland region that is sparsely populated, which makes it very ideal for low cost, open pit mining. The deposit site has a network of seasonal secondary roads accessing a district road system that leads to the regional capital (and port city) of Toliara. Going in a southerly direction, via the RN 10 or RN 13will lead you to Fort Dauphin (the other port city that Energizer will utilize for shipping the graphite), located in the southeastern part of the island.  


Geologically, Molo is situated in the Bekikiy block (Tolagnaro-Ampanihy high grademetamorphic province) of southern Madagascar. The Molo deposit is underlainpredominantly by moderately to highly metamorphosed and sheared graphitic(biotite, chlorite and garnet-rich) quartzo-feldspathic schists and gneisses, whichare variably mineralized. Near surface rocks are oxidized, and saprolitic to a depth,usually of less than 5 metres (m). Overburden is very minimal and is characterized as a thin grass cover that is a little as a couple of centimetres thick before exposing the graphite.  


Molo is one of several surficial graphite trends discovered by Energizer in late 2011 and announced in early January 2012. The deposit was originally drill tested in 2012, with an initial seven holes being completed. Resource delineation drilling and trenching on Molo took place between May and November of 2012, and allowed for a maiden Indicated and Inferred Resource to be stated in early December of the same year.  


The Molo project hosts the following resources:

  • Measured mineral resource of 23.62 MT grading 6.32% carbon (“C”).
  • Indicated mineral resource of 76.75 MT grading 6.25% C.
  • Inferred mineral resource of 40.91 MT at 5.78% C.

Effective date of the Mineral Resource tabulation is August 14, 2014. The Mineral Resources are classified according to the Canadian Institute of Mining definitions. A cut-off grade of 4% C was used for the “higher grade” zones and 2% C for the “lower grade” zones.  Please note that while the ‘high’ grade resource occurs within the ‘low’ grade resource, each was estimated and reported separately. A relative density of 2.36 tonnes per cubic metre was assigned to the mineralized zones for the resource estimation. 

The above maiden mineral resource estimate formed the basis for a Preliminary Economic Assessment (PEA), which was undertaken by DRA Mineral Projects in 2013. The positive outcome of the PEA lead Energizer to commence a full Feasibility Study (FS), which required the Company to undertake another phase of exploratory drilling and sampling in 2014, which was done under the supervision of Caracle Creek International Consulting (Proprietary) Limited.

That phase of exploration was aimed at improving the geological confidence of the deposit and its contained mineral resources, and included an additional 32 diamond drill holes (totalling 2,063 metres) and 9 trenches (totaling 1,876 metres). Caracle Creek were subsequently engaged to update the geological model and resource estimate of Molo, which was based upon 80 drill holes (totaling 11,660 metres) and 35 trenches (totalling 8,492 metres). The resource remains open along strike and to depth.

Proven And Probable Mineral Reserves

As a result of the additional exploration, the following maiden proven and probable mineral reserves were declared at Molo. The Mineral Resources above are inclusive of the Mineral Reserves below. 



C Grade (%)







Proven and Probable



Proven reserves are reported as the Measured Resources inside the designed open pit and above the grade cut off of 4.5% C. Similarly, the Probable Reserves are reported as the Indicated Resources inside the designed open pit and above the grade cut-off of 4.5% C. 

The Mineral Resources are classified according to the Canadian Institute of Mining definitions. A cut-off grade of 4% C was used for the "higher grade" zones and 2% C for the "lower grade" zones. Please note that while the 'high' grade resource occurs within the 'low' grade resource, each was estimated and reported separately. A relative density of 2.36 tonnes per cubic meter was assigned to the mineralized zones for the resource estimation. The resource remains open along strike and to depth. 

FULL FEASIBILITY STUDY COMPLETED (i.e. ‘Bankable Feasibility Study’) 

On the February 5th, 2015 Energizer Resources Inc. announced the results of its Feasibility Study (FS) for its 100%-owned Molo graphite deposit in southern Madagascar. The FS was prepared by DRA Projects (Pty) Ltd ("DRA") and is based on metallurgical test work conducted by SGS (Lakefield) Canada Metallurgical Services Inc. This test work included bench, pilot and variability tests. The completion of the FS was a significant milestone for Energizer in its development path to bring the Molo graphite project to production. The results confirmed to the market that the Molo project is economically viable with a planned mine design that the Company believes is both conservative and realistic. It indicates the project has attractive economics and that it has one of the lowest operating costs in the industry. The Molo graphite deposit is large enough to realize a very long mine life and the plant is scalable which equates to a nimble ramp up of production if so required. The plant will be able to produce a high quality graphite concentrate, which can supply the entire spectrum of end uses for natural graphite including the refractory, graphite foil and battery-anode (electric vehicle battery) markets. 

FS Highlights 

1      Post-tax: NPV (10% Discount Cash Flow)(1)(2) US$ 389,797,113
2      Post-tax: IRR(1)(2) 31.2%
3     Payback(2) 4.84 years
4      Capital cost (“CapEx”) US$149.9 million
5     Design Development Allowance US$13.8 million
6     Contingency US$24.6 million
7      On-site Operating Costs (“OpEx”) per tonne of concentrate, Year 3 onward) US$353
8      Transportation per tonne of concentrate (from Mine site to Madagascar Port Year 3 onward) US$182
9     Transportation per tonne of concentrate (from Madagascar Port to European Customer Port from Year 3 onward) US$155
10   Average annual production of concentrate 53,017 tonnes
11   Life of Mine (“LOM”) 26 years
12 Graphite concentrate sale price (US$/tonne at Start Up – 2017) US$1,689 per tonne
13   Average Head Grade 7.04%
14 Average ore mined per annum 856,701 tonnes
15 Average stripping ratio 0.81:1
16   Average plant recovery 87.80%

1. Assumes project is financed with 50% debt and 50% equity. 
2. Values shown based on nominal cash flows, which include the effect of inflation.  Costs are increased on an annual basis by the relevant inflation index.  

Financial results post tax* 

Average price / tonne of concentrate (at start up, 2017)


Internal Rate of Return (“IRR”) – Project Equity


NPV @ 8% Discounted Cash Flow


NPV @ 10% Discounted Cash Flow


NPV @ 12% Discounted Cash Flow


Project Payback Period

4.84 years

*Assumes that the project is financed through 50% equity finance and 50% corporate debt.  The debt assumptions used in the model assumes a rate of 5.75% over LIBOR, with LIBOR forecast to escalate to 3.54% by 2022.  An arranging fee is also assumed. 

Note that all values in the above table do not account for inflation and assume that a satisfactory investment agreement is negotiated under Madagascar’s LGIM (Loi Sur les Grands Investissements Miniers) tax laws covering large scale mining investments, for which this project qualifies. Also included in the above table are forecasted prices for 2017, which coincides with the year the Molo mine is expected to be in production. 

Mine & Process data 

Proven reserves   14,170,000        tonnes @ 7.0% C grade
Probable reserves 8,367,000          tonnes @ 7.04% C grade
Grade (graphitic carbon)    7.04% average plant head feed over LOM
Waste to ore ratio  0.81:1
Processing rate  856,701 tonnes per annum
Mine life   26 years
Recovery    87.8%
Average annual product tonnes 53,017 

Construction Capital Costs – CapEx (in US$ millions):

Capital Cost     US$149.9
Design Development Allowance    US$13.8
Contingency      US$24.5
Total   US$188.2*

*Excludes taxes, tariffs, duties and interest  

OpEx per Tonne of Feed


Year 3+ (Run Rate)





General & Administrative


Total OpEx per Tonne of Feed


OpEx per Tonne of Concentrate at Mine Site


Year 3 onward (Run Rate)





General & Administrative


Total OpEx cost per Tonne of Concentrate at Mine Site


All capital and operating costs expressed above are considered to be accurate to +/- 10%, and assume a varying inflation rate of 1.6% in 2015 and escalating to 2.0% from 2017 onward.  Currency inflation rates were also considered in the financial model. 

Transport (Molo Site to European Customer)

Average transport cost: US$337 per tonne of concentrate (from Mine site to Europe via Fort Dauphin, Madagascar, in December 2014 terms).

DRA has not included any financial or operational calculations and/or scenarios in the FS financial model with regards to downstream value-added processing of the graphite concentrate. This includes purification, spherodization and coating for battery-grade graphite and thermal expansion for specialty graphite applications, such as foils.

Note: Exchange rates used in the financial model were as follows:

  • 11.31 South African Rand (ZAR) to US$1,moving in line with purchasing power parity
  • 0.833 Euro to US$1, fixed for the modelled period
  • 2,746 Malagasy Ariary (MGA) to US$1, moving in line with purchasing power parity

The FS “2017 Start-Up” price for a tonne of Molo graphite concentrate was calculated from the weighted average price per tonne of US$1,375 (in December 2014 terms), which is a continuation of trends from 2005 (excluding the 2010 to 2013 unusually high graphite concentrate prices).  The US$1,375 price is the weighted average price for the various flake sizes and grades of flake graphite that are expected to be produced from the Molo deposit. The graphite prices used to calculate the weighted average were based on real market quotes at the time that the FS was being completed and the projected estimates were provided by UK-based Roskill Consulting Group Ltd (“Roskill”), who are recognized as a leader in providing independent and unbiased market research, pricing trends and demand and supply analysis for the natural flake graphite market.

A summary of certain significant differences between the FS and the Company’s Molo Preliminary Economic Assessment Study (“PEA”) are as follows:

  1. The PEA assumed 1.16 million tons (“MT”) per annum of ore, resulting in 84,000 tpa of graphite concentrate.
  2. The PEA CapEx estimate accuracy was +/- 25%, based on order of magnitude estimates.
  3. There has been a reduction in head grade to the plant from 8.5% C to 7.04% C.
  4. The FS includes delivery costs to Europe.
  5. The FS has assumed 50% debt funding on an eight operational year basis, whereas the PEA assumed 57% debt on 10 years.
  6. The FS has a more well defined flow sheet. 



The FS considers a mine that will produce an average of 856,701 tonnes per annum of ore, which is processed to produce an average of approximately 53,017 tonnes of graphite concentrate per annum over a 26 year life of mine ("LOM"). Production is targeted to commence in 2017. DRA has estimated a build-time of 17 months from the point the project is fully funded. The FS assumes that the mine is funded on a 50% debt and 50% equity basis.

The proposed development of the Molo graphite project includes the construction of an open pit mine, a processing plant with a capacity of 862,000 tonnes of ore per annum and all supporting infrastructure including water, fuel, power, tailings, buildings and permanent accommodation.

The mine will utilize four 2-megawatt diesel generators, with three running and one standby by and water is supplied from a well field, which has been defined by drilling and geo-hydrological modelling. The processing plant will consist of conventional crushing, milling and flotation circuits followed by concentrate filtering, drying and screening. The waste heat generated by the power station will be utilized for the drying of the concentrate.

The tailings storage facility, in the form of a valley dam layout, is located approximately 1.5 kilometres to the west of the process plant and is designed to accommodate the run-of-mine tonnage for the 26-year life of mine.

Below is a depiction of the proposed layout of the Molo mine site.  




The cost to ransport one tonne of dry concentrate (0.5% moisture content) from Molo to Rotterdam, Netherlands via Fort Dauphin, Madagascar, in December 2014 terms is 337 US$ / tonne. This is based on shipping 26 tonnes of concentrate in 1m3 bags placed inside a 40 ft. container. 

The route from Molo to Fort Dauphin runs either via the RN 10 or the RN 13. Both these routes utilize a series of regional dirt roads of varying condition out to the port. For the FS, DRA contracted a Madagascan trucking contractor to run over the route so as to gauge cycle times and they managed to complete the journey in two days each way. However, DRA built into the FS a time of four to five days to make the round trip so as to conservatively account for the wet season, where there may be periods of time when the roads can become more difficult to pass.

Upgrading of Main Arterial Roadway Close to Molo Project

Energizer has re-confirmed that the European Union (EU) has reinstated civil infrastructure development projects in Madagascar, beginning with the allocation of funds for the upgrading of the main arterial roadway, Route Nationale 13 (RN13).  The roadwork is being completed by Sara SRL, a recognized Malagasy engineering construction company. Representatives from both Sara SRL and the EU have independently confirmed the allocation of tenders in Madagascar for the road rehabilitation work.

This roadway connects the capital city of Antananarivo to the state-of-the-art deep water port of Ehoala in Fort Dauphin, which is the port that Energizer plans to utilize for shipping its Molo graphite. The Port of Ehoala is a modern (2009) port and was constructed for and being utilized by Rio Tinto/QMM’s ilmenite sands project in the south eastern region of the country. It has a 15m draft with shipping lines calling on a regular basis. The upgrade of the RN13 has begun with the portion closest to the Molo Project and will eventually end at the port, which currently has both excess capacity and power.

The first portion of the road upgrade was be completed at the end of 2015, with the second portion of the works program expected to begin in the Spring of 2016 to extend the road to Ambavombe, where it will intersect with the EU’s 2016 program to rehabilitate the third section, which is the coastal road out to the ocean port at Fort Dauphin.

The upgrading of RN13 has the potential to positively impact the Company’s projected mine economics that were used in the FS report by reducing the transportation costs from the Molo site to the port, and subsequently the total transportation costs to customer destination resulting in lower overall operational costs. 

The Port of Ehoala at Fort Dauphin.



The Molo 2015 FS was based on a full suite of metallurgical test work performed by SGS Canada Metallurgical Services Inc. (“SGS”) based in Lakefield, Ontario, Canada. These tests included laboratory scale metallurgical work and a 200 tonne bulk sample / pilot plant program. The laboratory scale work included comminution tests (the reduction of solid materials from one average particle size to a smaller average particle size by crushing and/or grinding), process development and optimization tests, variability flotation, and concentrate upgrading tests.

Comminution test results place the Molo ore into the very soft-to soft category with low abrasivity. A total of approximately 150 open circuit and locked cycle flotation tests were completed on almost 70 composite samples as part of the process development, optimization, and variability flotation program. The metallurgical programs culminated in a process flow sheet that is capable of treating the Molo ore using proven mineral processing techniques and extraction has been successfully demonstrated in the laboratory and pilot plant campaigns.

The overall graphitic carbon recovery into the final concentrate is 87.8% using samples from all drill holes within the five-year pit design. The area composites were generated by splitting the area within the five-year mine plan into five zones. All drill holes within one specific zone were then combined to form an area composite.  A total of fifteen area composites were generated for metallurgical evaluation (five zones with three depth intervals per zone).  All assays were completed using control quality analysis and cross checks were completed during the mass balancing process to verify that the results were within the relative error of the analytical method.

The average composition of the combined concentrate grade is presented in the table below. 


Molo Metallurgical Data – Flake Size Distribution and Product Grade

Product Size                            % Distribution              Product Grade (% Carbon)

+48 mesh (jumbo flake)             23.6                               96.9

+65 mesh (coarse flake)            14.6                               97.1

+80 mesh (large flake)               8.2                                97.0

+100 mesh (medium flake)         6.9                                97.2

+150 mesh (medium flake)         15.5                              97.3

+200 mesh (small flake)             10.1                              98.1

-200 mesh (fine flake)                21.1                              97.5



The Company believes the FS is both conservative and realistic, which indicated robust project economics and in particular, an operating cost (ex-mine) of US$352/tonne, which positions Energizer in the lowest cost quartile of graphite producers. While the positive results of the FS confirm that the Molo project is economically viable based on the planned mine design, the Company believes that there may be opportunities to reduce both the operating expenditures (“OpEx”) and capital expenditures (“CapEx”) of the project. In an effort to quantify these potential reductions, the Company has initiated portions of a detailed engineering review to further optimize the FS.

Some of the key aspects of the optimization study will include the following:

i) The engagement of two engineering consultants to review the design and construction plan anticipated in the current FS model.

  • As part of this review, the Company will consider other execution strategies such as constructing a large percentage of the mine processing facility off site, which would then be disassembled, shipped and reassembled on site in a "plug and play" type scenario. The Company believes that the potential benefits for this type of build plan could be lower CapEx costs, shorter construction timelines to production and improved management and quality of build process to help ensure the project would be remain on budget and on time.

ii) Issuing of requests for proposal regarding a possible renewable energy solution for the Molo site.

  • Based on preliminary discussions and feedback from several energy storage system solution providers, this could provide an overall reduction in energy costs, which would then translate into further OpEx savings as compared to what has been modeled in the FS. An option being investigated is a 5 to 8 megawatt solar PV/diesel hybrid off-grid power facility that may be able to reduce project power costs, which are calculated on 100% diesel generation in the current FS. An international environmental agency is currently in Madagascar conducting a comprehensive analysis of the country’s wind and solar characteristics. The agency has begun mapping the entire island to record wind and solar data, with the Molo site being fast-tracked in the process and will be mapped over the next two weeks.
  • The climate and geographical location of the Molo Graphite Project provides an ideal setting for a renewable energy power solution and could minimize the effect of possible escalating costs of diesel in relation to ongoing power needs at site. A solar and/or wind powered option is very appealing to Energizer, whose corporate environmental goals are to operate as “clean and green” as possible and to minimize the carbon footprint of the project. This may also provide us with the opportunity to participate in the trade of international carbon credit units. 

Please refer to the Molo feasibility studt technical report found under the Company’s profile on SEDAR for further details regarding the Molo Graphite Project. best odds.

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