Australian mining company Syrah Resources, operating in Balama district, Cabo Delgado, northern Mozambique, announced on Thursday, June 19, that it has resumed production of natural graphite—used in electric vehicle batteries—after a six-month suspension caused by social unrest in the country.
In a statement to the markets, cited by Lusa, the company clarified that “production resumed after access to the production site was restored on May 5, following remobilization, inspection, maintenance, and preparation activities.”
“Syrah will progressively ramp up plant utilization and production volumes in an operational campaign to restock finished product inventory. Subject to market demand, we expect to continue operating the Balama mine,” the company stated.
The miner noted that “there is significant and growing demand for natural graphite products, particularly outside of China, due to global supply disruptions,” and it expects to accelerate deliveries in the third quarter of this year.
However, the company highlighted that the “force majeure” declaration—which led to the suspension of operations—remains in effect under the Balama Mining Agreement, pending the resumption of product shipments and a more thorough review of the operating environment. In December of last year, Syrah declared “force majeure” and halted operations at the Balama graphite mine due to political and social turmoil. This decision caused the company’s stock value to drop by 28% and triggered a default on loans backed by the United States Government.
At the time, Syrah—a supplier of graphite for electric vehicle batteries, including under contract with Tesla—stated that roadblocks had prevented material transport and forced a temporary closure, with workers being sent home.
The company had previously received $150 million in funding from the U.S. International Development Finance Corporation and another $98 million from the U.S. Department of Energy to support the Balama mine and build a graphite processing plant in the U.S. However, instability in Mozambique compromised the fulfillment of those financial obligations.
“The impacts and duration of the protest actions triggered default events on the company’s loans with the U.S. International Development Finance Corporation and the U.S. Department of Energy.”
Mozambique experienced nearly five months of post-election tension, marked by widespread protests that resulted in 390 deaths during clashes between civilians and police. The unrest, which caused substantial economic damage, was incited by former presidential candidate Venâncio Mondlane, who rejected the results of the October 9, 2024, elections, in which Frelimo and its candidate Daniel Chapo claimed victory.
In April, Parliament unanimously and definitively approved a political agreement law aimed at pacifying the country, including amendments to the Constitution and presidential powers. The legal framework, approved by all four parliamentary parties, was based on an agreement between President Daniel Chapo and all political parties, signed on March 5 and submitted to the Assembly for urgent consideration.
Source: DE
