Andromeda Metals Limited (ASX: ADN) has announced the results of a Scoping Study evaluating the potential production of High Purity Alumina (HPA) from its Great White kaolin deposit. Andromeda Metals is an Australian company focused on developing and processing high-quality kaolin deposits. The company’s flagship Great White Project is located in South Australia.
The HPA Scoping Study indicates strong economic potential for Andromeda to become a leading global producer of low-cost, low-carbon HPA. The study outlines a Net Present Value (NPV) of approximately $1.48 billion pre-tax and $1.01 billion post-tax, with pre-production capital costs estimated at $155 million. Operating costs are projected to be around $4,718 per tonne, resulting in a high product margin of 85% at a sale price of $31,250 per tonne. This is underpinned by the high quality of kaolin from the Great White Project, which is ideally suited for HPA production due to its high grade and low levels of impurities.
Key findings of the study include a proposed HPA processing facility capable of producing 10,000 tonnes per annum of 4N HPA using approximately 30,000 tonnes per annum of Great White Project kaolin as feedstock. The study also highlights favourable market fundamentals, with an anticipated 20% compound annual growth rate (CAGR) of demand. Furthermore, modelling suggests that Andromeda’s HPA processing technology will result in lower carbon emissions than traditional processes.
Sarah Clarke, Andromeda’s Acting CEO, stated that the HPA Scoping Study demonstrates the exciting potential for Andromeda to become a global producer of low-cost HPA products, using the company’s low-carbon processing technology. The Company has determined that the outcomes of this Scoping Study warrant progressing the HPA Project. Next steps, subject to funding and approvals, include investigation of production and sales of 3N and 5N HPA products, establishment of a continuous pilot plant for process flow sheet optimisation and production of commercial samples for potential customers, pre-feasibility and supporting studies, and research into the potential value of silicate by-products.
