Flinders Resources has terminated its binding letter agreement to acquire Big North Graphite.

The company have signed a deal for the proposed transaction on 2 September and a series of other deals in this regard.

Big North said to have failed to satisfy the due diligence process which resulted in the termination of the deal, Flinders Resources said.

Flinders Resources president and CEO Blair Way said: "The due diligence process is critical to ensure the legal integrity of a transaction such as this.

"The due diligence identified key issues that could not be resolved so the agreement had to be terminated.

"We will continue to look for the correct asset to add to our company to grow the business beyond the European market."

Flinders operates Woxna graphite mine in central Sweden. The mine resumed production in 2014 and is said to be a fully-permitted brownfields graphite property.