High Purity Alumina
FYI Resources Limited, ASX: FYI, [website] located in Cottesloe, Western Australia, has identified high purity alumina (HPA), a major input into ceramic coated separators in batteries as a strategic commodity for exploration and development at its Cadoux Kaolin project in WA. The corporate strategy is to become a world leading producer.
HPA is mainly used for its superior properties such as corrosion and scratch resistance, high brightness and its ability to withstand extreme temperatures. It is used as a base material in the manufacture of sapphire substrates for applications such as light emitting diodes (LEDs) in the manufacture of artificial sapphire glass (e.g., mobile phone and television screens) and in certain battery and power storage components. artificial gemstones and aeronautical and medical applications.
FYI intends to utilize the low-cost, low-impurity, high grade aluminous clay sourced from the Cadoux kaolin deposit as the feedstock in a hydrochloric acid leach (HCL) process which will be efficient and effective in the production of HPA. Sourcing ore from the company's own deposit at Cadoux will ensure security of supply and allow a very tight control over product quality and characteristics such as purity, size, crystal structure and products that may be especially engineered for specific markets and applications.
FYI's strategy is to re-engineer the HPA processing route by producing 99.99% alumina directly from an ore source - not from already refined aluminium metal. In achieving this management will utilize standard flow sheet and proven off-the-shelf equipment in its process design to optimise production efficiencies and to reduce production risk.
The company states it has an all-in NVP of US$506 million, an IRR of 46%, project payback in about 3.5 years, the lowest sector qartile opex of US$646 per ton and capEx of US$178 million.
Research on the market indicates that it is witnessing dramatic consumer growth with the HPA market forecast to be US$4.49 billion by 2022.
Increasing environmental awareness and strict government power and emission policies has led to phasing out old and inefficient lighting applications (e.g. incandescent, neon and halogen).
HPA is a processed premium non-metallurgical alumina product characterised by its purity level. Currently, it is sourced from expensive feedstock such as refined aluminium metal sourced from bauxite using antiquated processing. FYI plans to produce low cost HPA from kaolin using an innovative processing route.
Attributes:
- extensive drilling, well understood geology;
- detailed mine study completed, reserves calculated, first 3 years of grade control completed;
- 100% owned project area, no native title, no EPA issues. Permitting completed; and
- reserve of 2.89 million tonnes grading 24.4% Al2O3 supports PFS mine life of 25+ years.
FYI is examining a number of funding options to finance its future activities and development costs. These include off-take, joint venture, cornerstone investor, project debt, equity and strategic investor.
FYI Presentation AGM, Nov '19 (20 pgs.) Link
Research by GCPP Colleague, Dec 3rd, '19 ( 18 pgs.) Link