Syrah Resources (ASX:SYR) has achieved the first successful production of unpurified spherical graphite at its Battery Anode Material (BAM) facility in Louisiana.

The facility used natural graphite from the company’s Balama project, located in the Cabo Delgado province of Northern Mozambique.

Successful production comes after the installation of milling equipment with a 5,000-tonne-per-year capacity; the company intends for production volumes to be initially focused on customer qualification and ongoing product development.

“The first production of spherical graphite from our BAM facility in Louisiana is a significant milestone for the company and a tribute to the dedication of the Syrah team and our contracting partners on site,” Syrah Managing Director and CEO Shaun Verner said in a statement.

“We will soon dispatch first unpurified product to commence the customer qualification process. This achievement is an important step for Syrah to capture advantage in establishing a core ex-Asia supply chain position, as the battery manufacturing supply chain co-locates and expands outside Asia.”

Going forward, Syrah plans to install purification equipment for purified spherical graphite batch processing in 2019’s first quarter. According to the company, this will be happening on schedule.

The company has signed two separate sales agreement for its Balama project in the last two months — the first with Qingdao Taida-Huarun New Energy Technology in November, and the second with Qingdao Langruite Graphite less than two weeks ago.

The agreement with Taida-Huarun is for 20,000 tonnes of natural graphite, with that material to be delivered by August 31, 2019. Meanwhile, Langruite’s agreement entails a minimum of 48,000 tonnes of natural graphite being delivered in 2019, with the option to add an extra 12,000 tonnes.

At the Benchmark Minerals Week’s Graphite+Anodes conference in October, Verner told the Investing News Network that Balama’s production will be heavily based around market demand.

“Next year we expect to produce between 250,000 and 300,000 tonnes and we will move to full capacity depending on demand,” he said.

Syrah’s share price ended Monday (December 31) up 4.15 percent at AU$1.51.

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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.