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HIGHLIGHTS:
Syrah Resources aims to restart graphite production at its Balama operation before the end of the June quarter
Maintenance and contractor teams have returned to the site for inspection and restart activities
Discussions with U.S. government loan agencies are ongoing amid deferral of interest payment
Syrah Resources Limited (ASX:SYR), part of the materials segment of the ASX 200 index, is working toward resuming natural graphite production at its Balama Graphite Operation in Mozambique by the end of the June quarter. The company has commenced re-establishment procedures following restored site access earlier this month.
The resumption follows a disruption that prompted a force majeure declaration under the Balama Mining Agreement. Site conditions have since improved, allowing Syrah to reintroduce its internal teams along with contractors covering camp services, mining operations, power supply, and mobile equipment.
Inspections reveal minimal issues at Balama plant
Preliminary assessments conducted since the return of site teams have not identified any major problems with key facilities including the plant, mine pit, tailings storage, and related infrastructure. Syrah has confirmed that inspection and maintenance work across the crushing, milling, flotation, filtration, drying, and bagging units will proceed sequentially over the coming weeks.
The company reported that only minor maintenance is required during the staged restart, which was anticipated due to the extended downtime. Early efforts are focused on re-establishing power, preparing living quarters, and securing the site to support operational stability.
Government collaboration and operational safeguards continue
Syrah continues to coordinate closely with Mozambique’s National Government, Cabo Delgado province officials, and community leaders. The goal is to address settlement processes tied to the earlier operational interruption and maintain consistent movement of personnel and goods in alignment with the Balama Mining Agreement.
Despite progressing toward operational restart, the force majeure declaration remains in place until full production and shipment activities resume. The company emphasized that mining operations are not immediately necessary for initial production phases and will recommence as needed.
U.S. government loan discussions remain active
Historical events of default related to Syrah’s financial agreements with the United States International Development Finance Corporation (DFC) and the U.S. Department of Energy (DOE) are under ongoing review. These matters were triggered by earlier interruptions at Balama and remain unresolved. Syrah noted that the DFC has deferred the mid-May interest payment originally scheduled under its loan terms.
The company confirmed its dialogue with both agencies is focused on satisfying requirements to lift existing defaults, ensuring compliance with funding conditions tied to Balama operations.
Market demand supports restart efforts
Syrah highlighted strong customer interest in natural graphite products amid ongoing disruptions in supply from non-China sources. The company’s inventory has been fully drawn down, and shipment strategies are being restructured to prioritize breakbulk logistics for quicker delivery and improved cash flow.
Depending on future market conditions, Syrah plans to continue operating in a campaign production mode. This strategy will allow the company to align production volumes with shipment windows while managing operational flexibility during the restart phase.
