Syrah Resources, an Australian mining company, has secured a three-year agreement to supply Lucid Motors, a North American electric car manufacturer, with graphite from its Balama mine in northern Mozambique, starting in 2026.
This deal will provide 7,000 tons of natural graphite active anode material (AMM) over the three-year period, supporting the production of batteries for Lucid’s electric vehicles.
According to Syrah’s announcement, the supply will be channeled through the company’s Vidalia factory in the United States, which processes the graphite extracted from the Balama mine.
Lucid, known for producing some of the world’s most advanced electric vehicles, will use the material to power the batteries for its flagship Lucid Air sedan and the new Lucid Gravity SUV, both manufactured at the company’s cutting-edge factory in Arizona, USA.
Lucid Motors, listed on the Nasdaq and headquartered in Silicon Valley, is renowned for its focus on high-performance electric vehicles.
The company’s goal is to create the most advanced electric cars, offering best-in-class performance and efficiency.
Syrah highlights that the Vidalia factory, integrated with the Balama mine, offers a unique value proposition for both governments and participants in the global battery supply chain.
The company notes that Vidalia, with its direct link to the Mozambican mine, stands out as one of the few suppliers of its kind in the natural graphite and AMM supply chain, emphasizing its importance in the North American electric vehicle battery market.
The deal comes after Syrah announced in November 2024 that it had received a $53 million (50.9 million euros) disbursement from the U.S.
Government’s International Development Finance Corporation (DFC), part of a $150 million (144 million euros) loan aimed at expanding the Balama mine and ensuring its sustainability. This loan marks the first-ever financing of a graphite mining operation by DFC, a significant step for the development of the electric vehicle battery supply chain.
However, Syrah’s operations have faced challenges, as protests have led to disruptions at the Balama mine. The company noted that further disbursements from the DFC will be delayed until the situation stabilizes, but it remains in close contact with the U.S. Department of Energy and other stakeholders to monitor the situation.
In the first quarter of 2023, Balama’s production reached 41,000 tons of natural graphite, an increase from 35,000 tons in the previous quarter. Sales also rose, reaching 30,000 tons, up from 28,000 tons in the preceding period.
Looking ahead, Mozambique is set to become a significant player in the global graphite market. The country is expected to produce over 329,000 tons of graphite in 2024, a more than 180% increase from this year’s production levels, according to government forecasts.
In comparison, Mozambique’s graphite output was 120,000 tons in 2020, with production dipping to 77,116 tons in 2021 before rebounding to an estimated 182,024 tons in 2022.
