Shares Held at Open: 3,125,000
What does EV1 do?
EV1 is a sustainable, ESG friendly, advanced stage graphite project in Tanzania.
What is the macro theme?
Graphite is a key component in lithium ion batteries.
Our previous battery materials investments have been very successful.
Up until now we did not have any exposure to graphite and its growing demand. Graphite has many other applications beyond electric vehicles too.
Our Big Bet for EV1
EV1 will achieve first production of the world’s most sustainably produced graphite by early 2024 (including value adding processing) coinciding with the onset of a long-term supply shortage in the graphite market.
Why did we invest in EV1?
Smaller, advanced graphite project so quick to market while graphite market strong
Fully permitted with JORC resource and DFS (US $87M capex for US323 NPV),
ESG focussed investment
ESG fund invested $8M and is forcing EV1 to be “best in class ESG”, so it can secure ESG capital funding to develop project
Market cap should catch up to peers by progressing down stream value add (good cap table, key shareholders escrowed).
What do we expect EV1 to deliver?
Objective #1: Final Construction Decision & progress towards Project Funding
The name of the game for EV1 is to reach a final construction decision and secure the ~US$87M required in capital costs to bring the project into production. DFS upgrades and optimisations will form a part of this process, but more importantly, EV1 needs to deliver all of the ESG requirements set out by ARCH (the cornerstone ESG shareholder), so that ARCH can help EV1 secure funding from other ESG funds in its network that only invest in top class, proven ESG opportunities.
Front end engineering design (FEED) – Appointment of Engineer
Front end engineering design (FEED) – Progress update
Front end engineering design (FEED) – Final report
ESG – Initial assessment or report
ESG – Sustainability report
ESG – Quarterly progress reporting
ESG – Life cycle assessment report
ESG – Progress towards zero carbon operation
ESG – ESG investment readiness announced
ESG – Independently assessed ESG score
ARCH Provides further project funding
ARCH introduces other ESG funds
Strategic Board appointment
Objective #2: Assess Downstream “Value Add” Opportunities
Assessing further downstream “value add” opportunities and the prospect of commercialisation is important for EV1’s success. Given that each graphite project’s mineralisation has a “unique signature”, it will be important for EV1 to work with potential offtake partners to ensure compatibility with existing technologies as well as the development of new technologies with EV1’s graphite.
Market update on downstream value add studies
Market update on downstream value add partnerships
Market update battery specific value add (studies or partnerships)
MoU signed with downstream partner 1
MoU signed with downstream partner 2
Offtake agreement 1
Offtake agreement 2
Objective #3: Increase Resource Size and find more shallow resource
Whilst an increase in the resource size is not necessary for making a final investment decision, the greatest opportunity to improve project economics identified in the DFS was adding more near-surface graphite deposits to substantially reduce mining costs.
We expect EV1 to undertake an expansionary drill program mid-way through next year, with a geophysics program to identify drill targets to commence imminently. We also want exploration to optimise the economics of the DFS by finding more resources at a shallow depth (cheaper to extract).
Announce Exploration Program
Drill Targets Identified/Refined
Drill Program commenced
Drill results announced
What could go wrong?
Any Tanzania sovereign risk flare ups will spook investors and dampen share price
Graphite prices could fall making the project harder to fund or uneconomical
Might struggle to secure ~$87M US to develop the project if market softens or they fail on ESG aspects
What is our investment plan?
We are holding a core position (min 50%) long term (4 to 7 years) to hold into first production
The company has a low market cap compared to peers, if EV1 delivers key milestones and the share price re-rates we will (progressively) sell ~20% with the goal to fee carry
if the company rises more than 500% after 12 months holding (CGT tax discount) we will look to take some profit progressive sell down of ~25%
Disclosure: The authors of this memo and owners of Wise-owl, S3 Consortium Pty Ltd, and associated entities, own 3,125,000 EV1 shares at the time of publication. S3 Consortium Pty Ltd has been engaged by EV1 to share our commentary on the progress of our investment in EV1 over time.
EV1 signs with world’s biggest anode producer - investment, offtake and MoU for downstream
Aug 16, 2023
Aug 16, 2023 |
Our graphite Investment Evolution Energy Minerals (ASX: EV1) has just signed a three part deal with the world’s biggest battery anode producer.
EV1 signs Framework Agreement for graphite mine in Tanzania
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Apr 18, 2023 |
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Mar 20, 2023
Mar 20, 2023 |
Our graphite Investment Evolution Energy Minerals (ASX: EV1) has just released an updated DFS on its graphite project in Tanzania, and is holding an investor webinar this morning to discuss it.
EV1 settles landmark agreements with the government of Tanzania
Mar 8, 2023
Mar 8, 2023 |
Today, EV1 announced a Framework Agreement and Shareholders Agreement that give certainty around the rights and obligations of all stakeholders in EV1’s graphite project have been settled in a form agreed by the Tanzanian government.
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Evolution Energy Minerals (ASX: EV1) was our Wise Owl Pick of the Year 2021, and recently we have seen the share price of the company rising. In this email, we uncover some upcoming catalysts for the company that may drive new interest in EV1.
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Our 2021 Wise-Owl Pick of the Year Evolution Energy Minerals (ASX: EV1) just renewed its mining license for its graphite project in Tanzania.
EV1 makes its second graphite discovery for the year.
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Our 2021 Wise-Owl Pick of the Year Evolution Energy Minerals (ASX: EV1) just made another graphite discovery at its project in Tanzania.
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EV1 Project financing update
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Drilling results are in - new graphite discovery made
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May 1, 2023 |
Earlier this morning , our 2021 Wise-Owl Pick of the Year Evolution Energy Minerals (ASX: EV1) announced that it had made a new graphite discovery. EV1 became our pick of the year primarily due to its shovel ready, DFS level graphite project in Tanzania - the DFS was updated back in March and showed attractive project economics, in particular its NPV of US$338M.
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