Skaland Sale Default and Tormin Liquidation Cast Shadow Over Mineral Commodities’ Growth Plans

Skaland Sale Delays and Operational Update

Mineral Commodities Ltd (ASX – MRC) has reported a delay in the completion of its sale of Skaland Graphite AS to Norge Mineraler Holding AS, originally agreed in the first quarter of 2025. Despite Norge Mineraler’s partial payments and a parent guarantee from Norge Mining Limited, the buyer remains in default. The parties have now agreed to finalize the transaction by 31 October 2025, with a payment of approximately USD 11.2 million due at completion.

Operationally, Skaland maintained steady production during the September quarter, delivering 1,551 tonnes of graphite concentrate. The site overcame typical European summer shutdowns and has recently commissioned a new drill rig supplied by Norge Mineraler, with mining operations returning to steady state and expected volume increases in the final quarter of 2025.

Munglinup Project – Strategic Focus and JV Negotiations

The company continues to focus on its battery minerals division, particularly the Munglinup Graphite Project in Australia, where it currently holds a 51% stake. Discussions with joint venture partner Gold Terrace Pty Ltd are ongoing regarding a potential transaction that could see Mineral Commodities acquire the remaining 49%, thereby gaining full ownership. While no formal agreement has yet been executed, the parties have agreed to pause legal claims pending a resolution.

Environmental approvals and further studies remain priorities for advancing Munglinup, which is positioned as a key asset to supply natural graphite for high-demand battery anode markets. The project’s definitive feasibility study from 2020 outlined a potential production of approximately 52,000 tonnes per annum over 14 years at a high-grade 12.8% graphite content.

Advancing Downstream Processing and Pilot Plant Progress

Mineral Commodities is also developing its Active Anode Plant Project, which has been temporarily paused pending the Skaland sale completion. Encouragingly, commissioning of a pilot-scale graphite anode plant has yielded battery-grade purity in initial tests without optimization. The pilot plant benefits from partial funding through the Australian government's Critical Minerals Acceleration Initiative and collaboration with Mitsubishi Chemical Corporation and CSIRO.

An 8-tonne sample from Munglinup has been sourced for pilot plant testing, underscoring the company’s integrated approach to graphite production and downstream processing, aiming to capture more value within the battery supply chain.

Tormin Mineral Sands – Provisional Liquidation and Market Interest

The South African Tormin mineral sands operation remains in provisional liquidation, with Mineral Commodities holding a 50% interest through Mineral Sands Resources (Pty) Ltd. The provisional liquidators have been granted extended powers to facilitate a sale, and the company reports multiple interested buyers have emerged. As a major creditor, Mineral Commodities is closely monitoring developments, which will be critical to its broader mineral sands strategy.

Financial Position and Outlook

As of 30 September 2025, Mineral Commodities held US$1.256 million in cash, up from US$565,000 at the end of June, while borrowings edged slightly higher to US$7.7 million. The company’s unit production costs at Skaland increased due to lower volumes during the quarter but are expected to improve with higher output in Q4. Sales revenue for the quarter was US$825,000, reflecting seasonal factors and inventory management.

Looking ahead, the company aims to finalize the Skaland sale, resolve Munglinup joint venture arrangements, and progress its downstream processing capabilities, all while awaiting the outcome of Tormin’s liquidation process and completing its 2024 audited accounts.