The approval allows the installation of a micronising qualification plant and associated infrastructure to go ahead.
The necessary equipment is enroute from North America and due for delivery in September.
The custom-built "qualification-scale" plant will significantly expand IG's downstream graphite research and development facility in Collie. It should be operational by late 2023.
The existing R&D plant was commissioned in September 2022 and was the first of its kind in Australia.
The qualification plant is designed to process graphite concentrates to produce a commercial micronized graphite product for quality and performance evaluation by potential customers.
It will be capable of producing 100t per annum to 200tpa of micronised graphite.
The plant will also be used to test graphite concentrates from IG's Springdale graphite project and help with R&D and market qualification of that material.
IG workers will also develop graphite operating and materials handling expertise using the plant.
IG managing director and chief executive officer Andrew Worland said a micronising operation would progress the company's plans to be the first mine-to-market graphite battery anode materials producer in WA.
That BAM is for the lithium-ion battery market.
"Micronised graphite is a byproduct of the micronising and spheroidising process used in the production of BAM and contributes to the economics of BAM production," Worland said.
"A commercial scale micronising facility would help establish markets for future micronised byproducts that would be produced from our planned Collie Graphite BAM facility, which would treat graphite concentrates produced from our 100%-owned Springdale graphite project near Hopetoun in WA."