AMMG study delivers HPA cost savings

THE BOURSE WHISPERER: Australia Minerals and Mining Group (ASX: AKA) has completed an integrated plant study based on the company’s own kaolin to high purity alumina (HPA) process flowsheet.

The process has been researched and developed by AMMG, while the study was conducted by its specialist engineering consultants.

AMMG said the study’s findings indicate the process contributes substantial cost savings to capital and operating expenditure for the company’s proposed HPA processing pilot plant.

AMMG explained the objective of the study was to further develop major operating parameters within the process flowsheet by incorporating several efficiencies.

The Study was conducted in conjunction with an optimisation test work program, which is nearing completion.

Using a base case of two tonne per day (or 700 tonnes/year), the plant’s capex is estimated at under $10 million, which includes a 30 per cent contingency.

The study’s capex/opex estimations for the plant are notably less than the figures determined by a previous pilot plant study that was completed in December 2013.

The company placed the results in the context of negotiating potential off-take agreements, saying although the study’s actual opex figure will remain commercial-in-confidence at this stage, it can be approximated at substantially less than $20 per kilogram.

Based on major industry producers’ reported HPA prices of $54/kg up to $300/kg (depending on purity and other specifications) the study’s estimated opex would enable AMMG to deliver a potentially competitively priced product.

“The positive findings of the study are highly encouraging as we move forward advancing funding arrangements for the development of the plant,” AMMG managing director Ric Dawson said in the company’s announcement to the Australian Securities Exchange.

“We are satisfied the study’s findings are in line with our expectations and understanding of our process and today’s HPA market.”