Hanré Rossouw

PROGRESS for Hanré Rossouw’s NextSource materialised last year with an agreement to build a $291m battery anode facility in Abu Dhabi. The facility will use graphite supplied from the firm’s Molo mine in Madagascar. After first flirting with Mauritius as a site for the plant, the United Arab Emirates (UAE) nation won out owing to its established infrastructure, pre-permitted industrial zones and other financial inducements, such as energy supply. The UAE is a keen investor in its own infrastructure and could therefore well provide sovereign-backed equity finance as NextSource looks to finance the plant’s $150m first-phase production.

At full tilt, planned for 2028, the plant will supply 14,000 tons annually of ‘anode-active material’ exclusively to the US through an offtake agreement with a Japanese multinational, signed in August. Mining afficionados will know, however, that projects never run smoothly, ever. True to form, Madagascar suffered a military coup in October when the relatively unknown Colonel Michael Randrianirina installed himself as head of state, ousting President Andry Rajoelina. The transition, while not peaceful, is seen by its miners in practical terms given the new government is disposed towards private sector investment.

Rossouw does not expect any alterations to Molo’s fiscal agreements. But the jury is out, especially as the Gen Z-driven uprising may yet prove restive if Randrianirina is perceived to be less than squeaky clean. This aside, NextSource has boxed smart with its UAE-US axis while graphite speaks for itself in the critical minerals chain given 95% of lithium-ion batteries comprise graphite. NextSource’s project may even prove to be a handy acquisition target for one of the larger miners hungry for scale.