GCM Graphite, a wholly owned subsidiary of Green Critical Minerals, has secured an 80% stake in the McIntosh graphite project in Western Australia after fulfilling stage three earn-in conditions.

This achievement follows the company's investment of more than $4m (A$6.13m) in the project over two years.

Green Critical Minerals completed stages one and two of the staged earn-in agreement in February 2022 after formalising the agreement in a binding term sheet with Hexagon Energy Materials.

The McIntosh graphite project is reputed to be Australia's fourth-largest graphite resource with 1.1mt of contained graphite. It offers high-purity flake graphite with excellent properties for lithium-ion batteries. The project is well positioned with access to a deep-water port and key customer groups in Asia, Europe and US.

The next phase involves forming an unincorporated JV with Hexagon Energy Materials for the exploration and evaluation of graphite within the project tenements.

Despite agreeing on the terms of a formal JV agreement, Hexagon has refrained from executing it due to ongoing legal proceedings in the Supreme Court of Western Australia.

Hexagon has filed counterclaims stating that GCM Graphite did not adhere to the binding terms sheet during the stage two earn-in, a position that GCM disputes, asserting that it has met all earn-in requirements by investing more than $3m in exploration.

GCM Graphite has responded to the counterclaim with a defence and is prepared to continue legal action if the dispute remains unresolved commercially.

The case was recently subject to a confidential mediation, which has been adjourned. The outcome of these proceedings will determine the future of the JV and the progression of the McIntosh graphite project.