King River Resources Ltd (ASX:KKR) has confirmed its proposed Kwinana plant’s technical and economical viability, as a pre-feasibility study (PFS) for its High Purity Alumina Project was released.
The PFS forecast a production rate of 9,000 tonnes per annum of 99.99% high purity alumina (HPA) once at full production, with project revenue of more than $7 billion over 25 years.
This proposed plant at Kwinana near Perth is where KRR will produce HPA, sourced from an industrial chemical feedstock and utilising its HPA refining process known as ‘ARC’ – highlighting the Aluminium feedstock, the use of only Recrystallisation steps in purification and final Calcination.
PFS affirms HPA focus
King River chairman Anthony Barton said the PFS was an important milestone for the company.
“This PFS has effectively endorsed our strategy to initially focus on entering the global HPA market, then consider developments at a later date of other high value/high purity commodities sourced from the Speewah vanadium-titanium and fluorspar deposits,” he said.
The details
Highlights of the PFS include:
Production rate of 9,000 tonnes per annum of high purity alumina of 4N purity;
Unit cash costs of A$8,987 per tonne HPA, or A$8.99 per kg HPA, during full production;
Annual EBITDA of A$193 million;
Annual pre-tax free cash flow of A$190 million;
Pre-production project capital cost estimate of A$203.4 million;
Project NPV before tax of A$1,043 million and IRR before tax of 50.8%;
25-year project revenue of A$7,027 million;
25-year project revenue of A$4,715 million; and
25-year project free cash flow of A$4,438 million.
It also flagged the potential for King River to become a major global producer of HPA, outside of Japan, USA, Europe and China.
“Supports transition”
Barton said: “These very positive study outcomes support the Kwinana Project’s transition immediately towards a more detailed definitive feasibility study.
“Once in full production, the Kwinana Project has been modelled to deliver pre-tax $190 million average annual operating free cash flow.”
Shares have been almost 13% higher intra-day to 3.6 cents.
Forecast HPA growth
HPA is an essential ingredient in the production of LEDs and lithium-ion battery separators, both of which are used in clean energy and high technology applications, such as lighting and electric vehicles (EV) – as such, demand for HPA is expected to increase.
The forecasted growth for HPA in excess of 99.99% purity (4N+) to 2028 is expected to be 53,000 tonnes, a compound annual growth rate of 13.7%.
Currently, 4N+ HPA is fetching around US$24 per kilogram in over-the-counter large transactions.
What makes King River different
King River plans to produce HPA via a processing plant at Kwinana using locally produced or imported aluminium chemical feedstock.
The company’s ARC HPA process flowsheet uses conventional crystallisation purification and calcination technologies and unit components, and readily sourced reagents.
This flowsheet has been demonstrated through laboratory-scale test-work to produce high recoveries of alumina into a high purity HPA product and is considered commercially scalable.
“The ARC HPA process has evolved through numerous laboratory leaching and precipitation studies undertaken on the mineral concentrates produced from KRR’s Speewah Strategic Metal deposits in the Kimberley region of Western Australia,” Barton added.
Up next for Kwinana is a definitive feasibility study (DFS). In the meantime, it has started the development of a mini pilot plant to demonstrate that its process works at a larger scale.
www.ferroalloynet.com
