More boxes ticked on the way to production

1 Nov 2016

The release of our latest quarterly report detailed the progress we made for our high purity alumina (HPA) project. We announced the start of our physical presence at the Johor site in Malaysia, with the opening of our office about 300 metres from the site of the proposed HPA plant.

As we told shareholders and the Australian Securities Exchange (ASX) in the report, the September quarter saw many of the building blocks of our HPA project start to position in place. The detailed design and engineering work for the proposed plant is being conducted by German-based engineering firm, M+W Group in Germany and Singapore. Detailed design involves the complete definition of every aspect of the plant, including detailed diagrams and drawings for construction, civil works, instrumentation, control systems, electrical facilities, management of suppliers, schedule of activities, costs, procurement of equipment and management of environmental impacts.

We’re also working with German government-owned KfW IPEX-Bank on structuring the project finance for the HPA project. The lifting of our export credit cover instigated the formal detailed due diligence of the HPA project and during the quarter Altech and KfW IPEX-Bank appointed the consultants to undertake definitive technical, market and legal reviews of the project. When the due diligence process is completed, there will be an expert-opinion report on the HPA project tabled to the German government’s interministerial committee (IMC), and that will form the basis of a decision on the approval to offer export credit cover by the IMC and Euler Hermes. 

Topping off all this work was our announcement, after the end of the quarter, of a maiden ore reserve at our Meckering kaolin deposit in Western Australia. The reserve was estimated at 1.2 million tonnes @ 30% alumina, which is more than sufficient to support the proposed HPA processing operation for the initial stage-one mine life of 30 years at an ore delivery rate of around 41,000 tonnes a year. The resource estimate at Meckering, of an estimated 12.7 million tonnes @ 29.5% alumina, would be sufficient to supply the proposed HPA operation for more than 250 years, which will also allow further capacity expansions in the future.

The next step of the process to bringing Meckering into production is the submission of the mining proposal and mine closure plan, as part of the approvals required for the commencement of construction.