Australian resource firm Syrah Resources has signed a binding offtake agreement with China Aluminium International Engineering (Chalieco) for its Balama Graphite and Vanadium Project in Mozambique.

The deal will allow Chalieco to exclusively distribute Balama flake graphite in China, and Hong Kong, excluding Macau and Taiwan (territory) over a three year period.

Chalieco representative Yang Kai said: "We would like to thank the efforts of Syrah management and are pleased to witness the successful conclusion of this binding offtake agreement.

"Chalieco strongly believes that graphite and its downstream products will be very important raw materials for both modern and traditional industries such as electric automobiles and steel."

As per the agreement, Chalieco will not supply graphite outside of the territory and will source product exclusively from Syrah.

Graphite being purchased by Chalieco will be around 80,000 tonnes per annum, at various size fractions, including +50, +80, +100 and +150 US mesh.

Syrah managing director Tolga Kumova said: "I would like to thank Chalieco for the tremendous support they have demonstrated for the Balama Project. We see them as a powerful partner with regards to their superb graphite market knowledge and distribution channels within China."