Valence Industries Signs Binding Three-year Graphite Sales Agreement

Valence Industries Ltd. (ASX:VXL) announced that it’s signed a three-year graphite sales contract with a new customer. The agreement is binding and will cover multiple products.
Highlights are as follows:

• Multi-year, multi-product Sales Contract signed with major customer
• Flake graphite sales in excess of US$50M over three years
• Key step in meeting conditions for initial syndicated finance facility

The press release also states:

The contract with this Asia Pacific based customer is significant as it provides for sales in excess of US$50 million (A$67.6M) over the next three years. This major customer will be purchasing graphite for use in industries including Aluminium, Steel, Metallurgical, Chemical, Refractory, Ceramics, Construction, Plastics and Rubber and Expandable Graphite Products.
The new sales contract focuses on the Company’s coarser flake graphite production which matches known production capability and mine signature. The benchmark pricing under the sales contract exceeds Valence Industries’ previously announced weighted average price of US$1,335 per tonne and includes take or pay provisions on the volumes ordered. This sales contract is in addition to the Heads of Agreement and adds to the multiple existing sales contracts entered into by Valence Industries.
The delivery profile in the contract is timed to match production from the Company’s existing Uley GraphiteTM facilities. This customer will be supplied initially from the existing 14,000 tpa plant and then from the expanded production facilities.

Click here to read the full Valence Industries Ltd. (ASX:VXL) press release.