Syrah Resources has announced force majeure at its Balama graphite mine in Mozambique, attributing the decision to the widespread civil unrest following the country’s disputed general election results in October.
The unrest has disrupted operations at several mining sites, including Balama, and is affecting both national and local government functions.
The company noted that the disturbances at the Balama mine began in late September, when a group of farmers with historical land resettlement grievances initiated protest actions.
These protests have persisted post-election, with additional local population groups joining and expanding their demands beyond the initial resettlement issues.
In response to the escalating situation, Syrah has demobilised the majority of its operational staff, maintaining only a full contract security presence at the site.
The ongoing instability across Mozambique has led to further national government opposition protests, making it impossible for Syrah to conduct the necessary production campaign for the December 2024 quarter.
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By GlobalData
Syrah has indicated that resolving the Balama protest will require time due to the broader unrest and the fact that the new Mozambican Government will not be established until January 2025.
The prolonged protests have also led to default on Syrah’s loans with the US International Development Finance Corporation and the US Department of Energy. Syrah is currently engaging with these entities regarding the defaults.
In April this year, Syrah concluded the retail portion of a non-renounceable entitlement offer, securing approximately A$98m ($65m).
The funds will support operational costs, reserve accounts, facility expansion and general corporate purposes at the Vidalia facility.
The company confirmed valid applications for nearly three million new shares from eligible retail shareholders.
