Graphite producer Syrah Resources (ASX:SYR,OTC Pink:SYAAF) said it is temporarily suspending operations at its Vidalia battery materials plant in the US state of Louisiana following a state-wide “Stay at Home Order” to fight the spread of COVID-19.

The order, issued on Sunday (March 22), will be in effect until April 13, with Syrah saying it does not meet criteria for exclusions under this regulation.

“This will delay the distribution of purified natural graphite samples for qualification with potential customers whilst the Stay at Home Order remains in place,” the company said in a press release.

Right now, Syrah’s team is working remotely to progress the feasibility study for the scale-up of the Vidalia facility post-product qualification.

The US plant, which the company purchased for US$1.23 million, produced its first unpurified spherical graphite at the end of 2018, with qualification samples dispatched to target customers in early 2019. The facility has environmental permits in place and an initial milling capacity of 5,000 tonnes per year.

Syrah’s Balama graphite project in Mozambique, which is the largest natural graphite operation outside of China, remains operational at this time.

“The company continues to monitor and assess the international mobility of personnel, the free movement of goods through supply chains and broader market conditions,” Syrah said, adding that it continues to strengthen protocols in response to COVID-19 risks at the asset.

Back in September, the company reduced production volumes to 5,000 tonnes per month at Balama due to volatility in the market. Syrah said it has continued its moderated production strategy into Q1 of this year as planned, seeking to match production volumes with market demand.

“Despite the near-term uncertainty due to COVID-19, the long-term market fundamentals for natural flake graphite remain intact, with ongoing commitment to the decarbonisation of the transport sector via lithium ion powered electric vehicles by supply chain participants and governments,” the company said.

Syrah expects its end-of-quarter cash balance to be broadly aligned to guidance of US$64.6 million.

On Tuesday (March 24), Syrah was trading up 2 percent at AU$0.23. However, the company’s share price has been suffering since the start of the year, and is down more than 50 percent since January.

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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.