Walkabout Resources, Wogen Pacific in deal for Lindi graphite purchase

24Apr 2019
The Guardian Reporter
LINDI
The Guardian
Walkabout Resources, Wogen Pacific in deal for Lindi graphite purchase

BETWEEN 10 and 30,000 metric tons of graphite concentrate from Lindi region has secured a global market through Wogen Pacific Limited after the company signed an agreement with Walkabout Resources Limited.

Walkabout Resources’ Executive Chairman, Trevor Benson speaks at a past global conference.

In a statement, Walkabout which is the parent company of Lindi Jumbo Limited said the binding global sales, purchase and marketing agreement between its 100 percent owned subsidiary, Lindi Jumbo Limited and international commodities trading house, Wogen Pacific Limited will last five years.

Wogen is a leading international trader and long-established marketer of off-exchange speciality-metals and minerals with a particularly strong presence in Asia, Europe and the USA which includes significant logistics infrastructure, buying networks and industry relationships.

Within the agreement, an advanced payment based on 80 percent of the value  for  each  consignment  of  concentrate contracted  by Wogen, will be  paid following  receipt  of  shipping  documents.

“The Wogen agreement perfectly complements the company’s strategy to outsource the major components of the Lindi Jumbo Project. As a result, Lindi Jumbo will not need to establish large and expensive marketing offices across several jurisdictions to manage its sales, customer relations and global logistics,” said Executive Chairman, Trevor Benson.

“The company will be able to leverage the marketing expertise of Wogen across the globe for sales at favourable prices, and to secure additional off-take agreements. The agreement is a key element in de-risking the Lindi Jumbo Graphite Project and attracting development capital leading up to construction and the first period of production,” Benson added.

His Wigon peer, Alex Williams was also full of excitement following the deal saying his company is happy to play a significant role in Walkabout’s Lindi Jumbo graphite project promising to deploy   extensive   capabilities   on   the   pre-marketing,   sales,   financing   and transactional side of this business.

“We  have  been  highly  impressed  by  the  Walkabout  management  team  over  the  course  of  the  many interactions we have had with them to date, which bodes well for a successful and mutually beneficial working  relationship  over  the  coming  years,” Williams noted.

“As such we have agreed to exclusively source graphite from Walkabout. This agreement further strengthens our position as a leading international trading house for speciality metals, as well as giving us an increased presence in the modern battery sector,” Williams added.

Pursuant to the agreement, Wogen will act as the marketer and buyer of the product and on-sell the concentrates on a commission basis to customers in Asia and other international markets as required.

Upon commencement of commercial production at the Lindi Jumbo Graphite Mine, the company shall make  available  to  Wogen  for  purchase, on  an  exclusive  basis,  a  minimum  of  10,000  tonnes  up  to 30,000 tonnes of concentrate per annum for a period of 5 years. 

Further to this agreement with Wogen, other terms include: within three working days of a consignment being loaded onto a shipping vessel in Tanzania and Wogen receiving the shipping documents, the company will immediately advance 80 percent of the deemed value of the consignment to Lindi Jumbo as working capital financing.

The remaining 20 percent less  Wogen  commission less agreed  on-costs  will  be  remitted  to  the company  upon receipt  of  payment in  full by  Wogen, which currently  is  typically 2-3  weeks  after shipment from Mtwara port. The maximum allowable aggregate of the working capital finance at any time is U$8m.