Proactiveinvestors Australia American Pacific Borate & Lithium Ltd https://www.proactiveinvestors.com.au Proactiveinvestors Australia American Pacific Borate & Lithium Ltd RSS feed en Wed, 24 Apr 2019 12:56:08 +1000 http://blogs.law.harvard.edu/tech/rss Genera CMS action@proactiveinvestors.com (Proactiveinvestors) action@proactiveinvestors.com (Proactiveinvestors) <![CDATA[News - American Pacific Borate & Lithium optimisation work delivers high-purity boric acid ]]> https://www.proactiveinvestors.com.au/companies/news/218457/american-pacific-borate--lithium-optimisation-work-delivers-high-purity-boric-acid-218457.html American Pacific Borate & Lithium Ltd (ASX:ABR) has delivered a high-purity plus 99.9% pure boric acid crystal with minimal impurities from process optimisation works at the Fort Cady Borate Project in California, USA.

The works, which were on April 10, 2019, were designed to ensure consistent delivery of a technical grade quality boric acid crystal from the project.

Shares on the ASX are up 12.5% to an intra-day high of 22.5 cents.

 Location of Fort Cady and Salt Wells projects in the USA

 

ABR chief executive officer Michael Schlumpberger said: “This is another hurdle in our aspiration to commence production of borates from our flagship Fort Cady Borate Project and ultimately to become a globally significant producer of high purity borate products.

“Our focus now turns to the completion of detailed engineering and securing the modest financing for the low capital starter project.

“Importantly, we have delivered a very low capital starter project with brilliant financial metrics that sees us on the pathway to becoming a globally significant producer of borates targeting an EBITDA of over US$340 million per annum.

“When you consider borates are a vital input into new world technologies including electric vehicles, clean energy and food security related micro-nutrients for optimal plant growth, we are sure the demand for borates will only continue to grow.”

 

Fort Cady boric acid assay results

ABR is focused on completing process optimisation works to ensure it can consistently deliver a technical grade premium boric acid product.

The results of these works have been very encouraging with a final process now designed to ensure that a high-grade product with minimal impurities will be delivered.

Optimisation works include:

Treating liquor (pregnant leach solution or PLS) retrieved on site from the Fort Cady ore body by solvent extraction using isoctanol as the organic extractant; Further treating the resulting liquor in a scrubbing stage to purify the liquor; and Crystallising the final liquor via a crystalliser manufacturer where the liquor was sent for evaluation and testing of the crystallisation steps of the process. ]]>
Fri, 12 Apr 2019 11:48:00 +1000 https://www.proactiveinvestors.com.au/companies/news/218457/american-pacific-borate--lithium-optimisation-work-delivers-high-purity-boric-acid-218457.html
<![CDATA[Media files - American Pacific Borate & Lithium shares ‘incredibly cheap’, according to Orior Capital report ]]> https://www.proactiveinvestors.com.au/companies/stocktube/12764/american-pacific-borate--lithium-shares-incredibly-cheap-according-to-orior-capital-report-12764.html Wed, 27 Mar 2019 20:38:00 +1100 https://www.proactiveinvestors.com.au/companies/stocktube/12764/american-pacific-borate--lithium-shares-incredibly-cheap-according-to-orior-capital-report-12764.html <![CDATA[News - American Pacific Borate and Lithium looks like a 10-bagger: former top-rated analyst ]]> https://www.proactiveinvestors.com.au/companies/news/216250/american-pacific-borate-and-lithium-looks-like-a-10-bagger-former-top-rated-analyst-216250.html American Pacific Borate and Lithium Ltd (ASX:ABR) is developing the Fort Cady borate and lithium project in California, USA which has a 120.4 million tonne deposit at 6.5% boron oxide.

Orior Capital analyst Simon Francis feels ABR is incredibly cheap in absolute terms as the current market capitalisation (US$21 million) is about 2% of the lower capex scenario net present value (NPV) of US$1,083 million.

Following is an extract from a special report on ABR prepared by Francis, who has worked extensively in a number of financial institutions including Nomura, Credit Suisse and Macquarie Securities where he was highly ranked in a number of key industry polls.

ABR acquired the project in May 2017. A Scoping Study was completed in December 2017, and a Definitive Feasibility Study (DFS) in December 2018, just 19 months after the acquisition.

In January 2019, ABR released a low-capex ‘enhanced’ version of the DFS, that split Phase 1 into two parts, and is now considered ‘base case’.

Phase 1A comprises the Phase 1 sulphate of potassium (SOP) line plus a commercial scale boric acid plant. Phase 1B is the full 82,000 tpa Phase 1 boric acid plant.

Looks like a 10-bagger: Based on the January 2019 DFS, the project has a post-tax, unlevered NPV10 of US$1,083m, with an IRR of 41% and an initial capex requirement for Phase 1A of just US$37m.

This is an incredibly low capex figure to get a project of this scale up and running.

Despite these strong metrics, ABR’s current market capitalisation is about 2% of NPV.

Assuming total initial capital (including working capital) for Phase 1A of US$50m, debt financing, 50m warrants at A$0.50 per share offered as an incentive to debt providers, a further US$80m in debt to fund Phase 1B, and a fair EV valuation 12 months from now of 30-50% of NPV, ABR could attract an EV valuation of US$325m to US$542m.

This equates to a valuation of A$1.10-A$2.21 per share, 7-14x the current share price.

Lower capex, much lower dilution: Junior companies with big projects often end up heavily diluting shareholders when the real money needs to be spent.

The brilliance of splitting Phase 1 into two parts is that this should now be avoided.

At US$50m all in, Phase 1A is financeable with debt plus warrants. With 1A in production, financing Phase 1B will be easier and cheaper.

By splitting Phase 1 into two, management have been greedy on behalf of shareholders. That’s a good thing.

Opportunity knocks: ABR shares are still trading at levels seen in 4Q18, the tail end of a horrible year in junior mining. So far, the market has failed to recognise the opportunity in ABR that this presents.

Compelling project with substantial cash flows: Based on the DFS, Fort Cady will ultimately produce ~408,000 tpa of boric acid and ~109,000 tpa of SOP. ABR will become only the second major producer of calcium-based borates globally, and only the second producer of SOP in the US. The project is expected to generate EBITDA of US$345m in the first full year of production.

Cooperation agreements with the Chinese majors: In May 2018, ABR secured cooperation agreements with Sinochem Hebei Corp, a subsidiary of China’s state-owned Sinochem Group, and with China National Fiber Corp, a subsidiary of China National Machinery Industry Corp (usually known as ‘Sinomach’).

These are substantial groups; in 2018, Sinochem Group was ranked 98th in Fortune Global 500. Sinomach was ranked 334th. (For comparison, Rio Tinto was ranked 278th).

It is no surprise the Chinese were quick off the mark; China is the largest market for borates and a significant net importer. That two of China’s largest and most established state-owned enterprises have entered into these agreements is a testament to the strategic value of the Fort Cady project.

Few new projects expected to come on stream: The borates market is essentially a duopoly with Eti Maden and Rio Tinto (RIO.L) together controlling ~80% of the world demand. Globally, there are few occurrences of commercially viable borate deposits; visibility on new projects other than Fort Cady is poor.

Some projects plan to mine borates as a by-product to lithium, but these are earlier stage, and rely on processing new minerals, something that will take time to learn.

The Fort Cady processing route is based on prior feasibility study level work, well-established chemistry and standard processing equipment. ABR offers the purest exposure to the boron market, the most advanced project, and the lowest capex.

Strong US demand for SOP: US SOP demand is expected to grow at ~4.8% pa over the next few years, having grown at almost 5% pa since 2009.

A number of factors are driving this growth including the use of newer, higher-yielding crops that extract more sulphur from the ground, the recent popularity of planting in cold soils, and global emission controls which have meant less sulphur deposition from precipitation.

In summary, Fort Cady is a hugely valuable project. It hosts a strategically important mineral, is in an excellent jurisdiction, and boasts very low capex costs. It is the most advanced borates project in the market. This, combined with the fact that ABR will be only the second producer of SOP in the US, means the company has a multitude of strategic options. The current share price, being ~2% of NPV, offers investors a great opportunity.

Disclaimer: This document is a marketing communication sponsored by American Pacific Borate and Lithium Ltd. It is not investment advice. It is for information and educational purposes only.

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Tue, 12 Mar 2019 17:04:00 +1100 https://www.proactiveinvestors.com.au/companies/news/216250/american-pacific-borate-and-lithium-looks-like-a-10-bagger-former-top-rated-analyst-216250.html
<![CDATA[News - American Pacific Borate & Lithium finalising an enhanced DFS ]]> https://www.proactiveinvestors.com.au/companies/news/216133/american-pacific-borate--lithium-finalising-an-enhanced-dfs-216133.html American Pacific Borate & Lithium specialises in borate and lithium exploration and enhancement in the US. It is run by Michael Schlumpberger, a mining engineer with more than 30 years of experience in the mining industry, across the phases of an operating mine’s life cycle. He boasts 21 years experience with Potash Corporation of Saskatchewan on his CV and held senior roles at a number of potash and resource companies before joining American Pacific.

What does American Pacific own?

The key asset is the wholly-owned Fort Cady Borate Project in Southern California.

American Pacific has spent more than US$60 million on Fort Cady to date and released a definitive feasibility study (DFS) for the project in December 2018.

The upgraded JORC-compliant mineral resource estimate for the deposit is 120.4 million tonnes at 6.5% boron oxide (11.6% boric acid equivalent) and 340 ppm lithium (5% boron cut-off) for 7.8 million tonnes of contained boron (13.9 million tonnes boric acid).

Some 72% of the total resource is contained within the exclusive region of American Pacific's subsidiary Fort Cady California Corp, which has an active operating permit for commercial-scale mining.

Mineralisation remains open to the southeast.

American Pacific wants to be construction ready quickly at Fort Cady and start building at the project as early as the latter part of 2019.

In January 2019, the company toured its strategic partner Sinomach subsidiary China National Chemical Fiber Corp. (CNCFC) at the US borate site.

The company has since enhanced the DFS for the project, improving its financial metrics and lowering its capital expenditure costs.

American Pacific’s managing director & CEO Michael Schlumpberger said the study had given the company a “strong platform” for starting strategic negotiations with large borate consumers.

The company is exploring options for mine construction with Sinomach subsidiary CNCFC and had a reciprocal visit on the cards earlier this year as the parties worked together.

American Pacific’s December study valued the Fort Cady project at US$1.25 billion (now $1.8 billion Australian dollars) at an unlevered after-tax net present value (NPV10) at a 10% discount.

The NPV8 value was US$1.59 billion while the unlevered internal rate of return (IRR) for the project was 41%.

At the time, phase I capital expenditure was US$138.2 million, with further refining work taking place since then introducing a model for a low-capex starter pit costing just US$36.8 million with a 13% contingency.

That starter pit stage, known as phase IA, has an unlevered after-tax NPV10 of US$224.7 million (now $319 million) and IRR of 58.3%.

The starter project, now part of a two-stage phase I, would bring in US$26.7 million of earnings before interest, tax, depreciation and amortisation (EBITDA) in the first year of operation.

This option would preserve a pathway to EBITDA of more than US$340 million in the first year of full production for the broader project.

American Pacific’s now three-stage construction program is designed to progress its project with low pre-production capex and very high margins before and after by-product credits — the margins are greater than 50% before by-product credits are added for elements such as sulphate of potash (SOP), gypsum and possibly lithium.

An enhanced DFS is expected to be completed in the March 2019 quarter as financing and other strategic cooperation discussions continue.

Steady state production in the original study was a targeted 410,000 tonnes per annum (tpa) of boric acid and 110,000tpa of SOP.

Pre-production capex had also included a 13% contingency and was estimated at US$138 million.

Another asset for the company is the Salt Wells Borate-Lithium Project, an exploration project over state lines in Nevada, near Tesla Inc (NASDAQ:TSLA) (FRA:TL0) (ETR:TL0) (SWX:TSLA).

The Nevada project gives the company more potential upside as it works towards a goal of becoming a globally significant borates producer.

American Pacific raised $4.2 million in the second half of 2018 and had $2.5 million cash on December 31.

Inflection points

Release of enhanced DFS targeted for March quarter

Progress of strategic discussions with borate consumers and other end-product users

Fruitful funding discussions for building two-stage or three-stage Fort Cady project, and starter pit

Construction and production milestones for project

Borate industry sentiment and value placed on US-sourced borate and other minerals

Progression of Salt Wells through exploration to development

Managing director & CEO Michael Schlumpberger outlines three-stage thinking

“We released our DFS in mid-December and in mid-December we essentially put this as a three-stage approach,” managing director & CEO Michael Schlumpberger told Proactive Investors last month.

“The first stage was 40,000 of sulphate of potash with 90,000 tonnes of boric acid. Phase II trebled that production to 270,000 short tonnes of boric acid and 80,000 tonnes of SOP and then phase III was then 450,000 tonnes of boric acid plus 120,000 tonnes of SOP.

“Outstanding financial metrics, but certainly looking at that we sat back and took a view of it that perhaps it would be better to enhance the project and one way we thought to enhance the project was to lower the initial capex.”

 

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Sun, 10 Mar 2019 21:00:00 +1100 https://www.proactiveinvestors.com.au/companies/news/216133/american-pacific-borate--lithium-finalising-an-enhanced-dfs-216133.html
<![CDATA[Media files - American Pacific Borate & Lithium MD discusses enhanced DFS metrics ]]> https://www.proactiveinvestors.com.au/companies/stocktube/12155/american-pacific-borate--lithium-md-discusses-enhanced-dfs-metrics-12155.html Mon, 11 Feb 2019 11:41:00 +1100 https://www.proactiveinvestors.com.au/companies/stocktube/12155/american-pacific-borate--lithium-md-discusses-enhanced-dfs-metrics-12155.html <![CDATA[News - American Pacific Borate & Lithium delivers low-capex boric acid and SOP starter project for Fort Cady ]]> https://www.proactiveinvestors.com.au/companies/news/213659/american-pacific-borate--lithium-delivers-low-capex-boric-acid-and-sop-starter-project-for-fort-cady-213659.html American Pacific Borate & Lithium Ltd (ASX:ABR) has enhanced the definitive feasibility study (DFS) released on December 17 for its Fort Cady Borate Project with a low capital expenditure starter project.

The cost-saving development measure was achieved by splitting phase one into two components, which delivers a pathway to production but substantially lowers targeted financing.

All other areas of the DFS remain consistent including the mining and processing of boric acid and the life-of-mine.

The company plans to advance financing discussions and start detailed engineering, with phase-one construction targeted to begin in quarter four 2019.

 

ABR chief executive officer Michael Schlumpberger said the company was delighted with the DFS enhancements, including the standalone low-capex project.

The first phase in the starter project, phase one-A, will target the production of 40,000 tonnes of sulphate of potash (SOP) and 6,000 tonnes of boric acid.

Phase one-B will increase boric acid production to 90,000 tonnes a year while using knowledge obtained through the smaller-scale phase one-A operation to optimise production.

Fort Cady is rare and large colemanite deposit and is the largest known contained borate occurrence in the world not owned by the two major borate producers Rio Tinto and Eti Maden.

The JORC-compliant resource at Fort Cady comprises 13.93 million tonnes of boric acid.

READ: American Pacific Borate & Lithium prepares for site visit from Fortune 500 company

Splitting the first phase has delivered exceptional financial metrics including a capex of US$36.8 million inclusive of a 13% contingency, reduced from the initial estimate of US$138 million.

Unlevered post-tax net present value with a 10% discount is $315 million and the internal rate of return is 58.3%.

With the decrease in pre-production capex of about 75%, the starter project will be financeable on a standalone basis.

Total capex for the project has increased by 7% but ABR expects the financing and technical benefits delivered will far outweigh the additional cost.

Summary of Fort Cady production by phase

  READ: American Pacific Borate & Lithium highlights strong financials of ‘low-risk’ US project

Schlumpberger continued: “We now have pre-production capex of only US$36.8 million and a pathway to phase three that has an annual EBITDA in the first full year of production of more than US$340 million.

“We have made the Fort Cady Project easier to finance, while limiting likely share dilution and preserving a massive EBITDA target in full production.

“Our ability to include such a low-capex starter project emphasises how unique the Fort Cady project is in the world of mining.”

READ: American Pacific Borate & Lithium’s DFS values Fort Cady Borate Project at $1.7 billion

The enhanced DFS estimates total cash costs of production, including by-product credits, as less than US$100 a tonne.

SOP prices in the high-priced Californian market are estimated to be over US$700 a tonne.

The production and sale of the 40,000 tonnes of SOP is unlikely to result in a reduction of selling price as the US is currently a new importer of SOP.

Route from Fort Cady to the port of Los Angeles

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Wed, 30 Jan 2019 20:09:00 +1100 https://www.proactiveinvestors.com.au/companies/news/213659/american-pacific-borate--lithium-delivers-low-capex-boric-acid-and-sop-starter-project-for-fort-cady-213659.html
<![CDATA[News - American Pacific Borate & Lithium enhances borate project DFS with low-capex initial phase ]]> https://www.proactiveinvestors.com.au/companies/news/213018/american-pacific-borate--lithium-enhances-borate-project-dfs-with-low-capex-initial-phase-213018.html American Pacific Borate & Lithium Ltd (ASX:ABR) has finalised enhancements to the definitive feasibility study (DFS) for its 100%-owned Fort Cady Borate Project in Southern California.

This includes splitting the current first phase into A and B stages which are designed to benefit project financing and operational efficiencies.

 

Phase one-A will focus on sulphate of potash (SOP) and a small-scale commercial boric acid operation.

The B phase will build-out a larger boric acid operation supported by results from the first phase.

ABR expects the overall capital expenditure for phase one to increase by less than 10% but will deliver financing and technical benefits that far outweigh the additional cost.

READ: American Pacific Borate & Lithium highlights strong financials of ‘low-risk’ US project

Fort Cady is rare and large colemanite deposit and is the largest known contained borate occurrence in the world not owned by the two major borate producers Rio Tinto and Eti Maden.

The JORC-compliant resource at Fort Cady comprises 13.93 million tonnes of boric acid.

The definitive feasibility study completed last month outlined a steady-state production target of 410,000 tonnes a year of boric acid and 110,000 tonnes a year of SOP.

Pre-production capex with a 13% contingency amounts to US$138 million and the project has a net present value at 10% discount of US$1.25 billion.

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Mon, 21 Jan 2019 23:10:00 +1100 https://www.proactiveinvestors.com.au/companies/news/213018/american-pacific-borate--lithium-enhances-borate-project-dfs-with-low-capex-initial-phase-213018.html
<![CDATA[News - American Pacific Borate and Lithium prepares for site visit from Fortune 500 company ]]> https://www.proactiveinvestors.com.au/companies/news/212641/american-pacific-borate-and-lithium-prepares-for-site-visit-from-fortune-500-company-212641.html American Pacific Borate & Lithium Ltd (ASX:ABR) is set to welcome representatives of Sinomach Group to a site visit of its Fort Cady Project in California.

In 2018 the company entered into a non-binding strategic cooperation agreement with China National Chemical Fiber Corp., a wholly owned subsidiary of Sinomach.

Sinomach is a Chinese state-owned enterprise and is a Global Fortune 500 company.

It is an international, diversified, comprehensive equipment industrial group.

READ: American Pacific Borate & Lithium highlights strong financials of ‘low-risk’ US project

American Pacific’s CEO Michael Schlumpberger said: “The release of the definitive feasibility study at the end of 2018 has presented ABR with a strong platform to commence strategic negotations with large consumers of borates.

“As announced on 17 December 2018, we are targeting a staggering US$321 million EBITDA in our first full year of production which makes our Fort Cady Borate project a substantial mining prospect in a low risk, supportive jurisdiction.

“The company signed an agreement last year with the Chinese SOE Sinomach that has businesses covering a wide array of industries where boric acid is used.

“Bringing representatives to site in California and a reciprocal visit in China are important steps in exploring options for mine construction.”

December’s definitive feasibility study (DFS) delivered compelling financial metrics estimating an unlevered post tax net present value (NPV) of US$1.25 billion.

This includes a steady state production target of 410,000 tonnes per annum (tpa) of boric acid and 110,000tpa of sulphate of potash (SOP).

Pre-production capex including a 13% contingency is estimated at US$138 million.

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Wed, 16 Jan 2019 10:22:00 +1100 https://www.proactiveinvestors.com.au/companies/news/212641/american-pacific-borate-and-lithium-prepares-for-site-visit-from-fortune-500-company-212641.html
<![CDATA[News - American Pacific Borate & Lithium highlights strong financials of ‘low-risk’ US project ]]> https://www.proactiveinvestors.com.au/companies/news/211616/american-pacific-borate--lithium-highlights-strong-financials-of-low-risk-us-project-211616.html American Pacific Borate & Lithium Ltd (ASX:ABR) managing director and CEO Michael Schlumpberger has highlighted the low capital expenditure of the company’s flagship project in California after publishing the project’s definitive feasibility study (DFS) on Monday.

Key financial metrics included an unlevered after-tax net present value (NPV10) of US$1.25 billion ($1.7 billion) at a 10% discount and phase-one capital expenditure of US$138.2 million

The Fort Cady DFS puts the project’s internal rate of return at 41% and is based on free-on-board prices of US$800 a tonne for boric acid and US$725 a tonne for sulphate of potash (SOP).

The capital estimates for the project’s three phases of capital expenditure add up to US$516.1 million, while US$245.2 million is the maximum negative cash position tipped for project build-up.

READ: American Pacific Borate & Lithium’s DFS values Fort Cady Borate Project at $1.7 billion

American Pacific’s MD & CEO spoke to Proactive Investors’ Stocktube video channel this week, saying the company believed the “borate market is an exciting place to be”.

He highlighted the borate market had few competitors and the company’s DFS for its flagship project had delivered strong financial metrics.

Schlumpberger revealed in the interview published on Wednesday: “Unashamedly, we’re looking to become a significant producer of borates.”

Fort Cady is the world’s largest borate resource not owned by the current borate industry duopoly players, big miner Rio Tinto plc (ASX:RIO) (LON:RIO) and Turkish state-owned borate company Eti Mine Works.

The site was mined by Duval Corporation in the 1980s.

The planned route for American Pacific’s boric acid, sulphate of potash, gypsum and hydrochloric acid to be transferred to Los Angeles port for export

American Pacific’s Fort Cady DFS models a project where borate acid could be solution-mined below ground then brought to the surface to be upgraded with a solvent extraction and crystallisation process.

The company would produce gypsum as part of its extraction process, and sulphate of potash during processing, with hydrochloric acid then being a by-product credit to be used to again mine the project’s borate resources.

Schlumpberger outlined why the company viewed the project as low risk, saying, “We think that the risk profile associated with the project is very low because not only is it technically proven there are not a lot of special things that need to occur, it’s an off-the-shelf kit.

“We’re largely permitted and certainly the geopolitical space of the United States as well as California are an interesting place to be.”

 

High expected margins

American Pacific’s MD spoke of the margins the company expected to achieve at the project which has a modelled life of 21 years.

Schlumpberger told Proactive, “Across our entire portfolio you’re basically looking at, without by-product credits, about a 50% margin.

“By the time you add in all the by-product credits you’re looking at margins upwards of 75%.

“So certainly that is what allows us to return such strong financial metrics.”

READ: American Pacific Borate & Lithium updates resource

The earnings before interest, tax, depreciation and amortisation (EBITDA) in the first year of operation is targeted to be US$321 million.

Fort Cady’s net direct cash cost (C1) operating expense (opex) estimate has been put at US$367.34 a tonne with no by-product credits, while the C1 opex estimate is US$148.84 a tonne with the credits.

The project’s proven and probable reserves, published earlier this month, are 41 million tonnes grading 6.6% boron and 4.81 million tonnes of boric acid.

Contained resources sit at 7.8 million tonnes boron or 13.9 million tonnes boric acid equivalent.

Life-of-mine from production is 21 years, with the company to draw on reserves for the first 14 years.

Key metrics from American Pacific’s Fort Cady DFS, published this week

Customers signed on or interested in offtake

Schlumpberger confirmed the company was targeting domestic and international markets after attracting interest in Fort Cady’s expected outputs.

He said, “Some of the agreements that we have are strategic agreements, and two Chinese majors, (Fortune magazine global 500 companies) Sinochem and Sinomach, are people that we’re in discussions with at this point in time.”

Wholesale trading company Sinochem Group (SHA:600500) had annual revenues of US$76.765 billion in 2017 while industrial machinery company Sinomach (SHA:600444) (SHA:600335) had US$42.638 billion revenues last calendar year.

Schlumpberger said, “One of our unashamed goals within the company is to become a globally significant producer of borates.

“And certainly over the last year, half-year for sure, we’ve been working very hard to make sure that that happens.”

READ: American Pacific Borate & Lithium raises over $4 million to fund Fort Cady Borate Project

Earlier this year, American Pacific raised $4 million from sophisticated investors to support the Fort Cady project.

Schlumpberger and the company are keen to get cracking after sharing the company’s DFS, saying, “Over $50 million has already been spent on this project and we’re able to advance it very quickly.

The company reported in August 2018 it planned to use the funds it raised to enable construction-related workstreams that it expected would follow a final investment decision.

At the time the MD said the placement would ensure the company could quickly move the Fort Cady project from studies to construction-ready activities after completion of the DFS.

Schlumpberger said in August 2018: “We have a very unique project that combines low capex, high margin, low technical risk and an EBITDA profile of more than US$150 million per annum in full production into a borate market growing at 6% per annum, with limited visible supply.

“With borates non-substitutable in new world applications like electric vehicles, wind turbines, space shuttles and agriculture, we can only see our project becoming more valuable as the reality of a tight ongoing market with one dominant supplier continues.”

The company also holds an exploration portfolio in Nevada, at the Salt Wells boron and lithium projects, in which American Pacific can earn a 100% stake.

American Pacific's projects in California and Nevada

About the company

American Pacific first listed on the Australian Securities Exchange in July 2017 after an oversubscribed $15 million initial public offering.

The company is headquartered in Perth, Western Australia, with a US office in Apple Valley, California.

Non-executive chairman Harold ‘Roy’ Shipes leads the company board and has more than 50 years experience in metals and mining.

Shipes is the president & CEO of Altair Resources Inc (CVE:AVX) (FRA:90AA) (OTCMKTS:AAEEF) and founded Atlas Precious Metals Inc and a number of other mining companies.

He also led OK Tedi Mining Ltd as chief executive officer.

READ: American Pacific Borate & Lithium completes magnetotelluric survey at Salt Wells projects

California-based MD Schlumpberger is a mining engineer who joined American Pacific in June 2017.

He has more than 30 years experience in the minerals industry and held senior roles with Potash Corporation of Saskatchewan, Passport Potash, and Highfield Resources Ltd (ASX:HFR) (FRA:23H).

Australia-based company executive director, commercial lawyer Anthony Hall, has more than 20 years commercial experience.

Hall was previously MD of Highfield Resources, as the Australian-listed company progressed potash projects in Spain.

American Pacific management personnel held 39% of the company in October 2018, while its other investors had a collective 61% stake in the company.

— with Danielle Doporto

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Thu, 20 Dec 2018 17:55:00 +1100 https://www.proactiveinvestors.com.au/companies/news/211616/american-pacific-borate--lithium-highlights-strong-financials-of-low-risk-us-project-211616.html
<![CDATA[Media files - American Pacific Borate & Lithium working to be 'globally significant borate producer' ]]> https://www.proactiveinvestors.com.au/companies/stocktube/11645/american-pacific-borate--lithium-working-to-be--globally-significant-borate-producer--11645.html Wed, 19 Dec 2018 09:00:00 +1100 https://www.proactiveinvestors.com.au/companies/stocktube/11645/american-pacific-borate--lithium-working-to-be--globally-significant-borate-producer--11645.html <![CDATA[News - American Pacific Borate & Lithium’s DFS values Fort Cady Borate Project at $1.7 billion ]]> https://www.proactiveinvestors.com.au/companies/news/211283/american-pacific-borate--lithiums-dfs-values-fort-cady-borate-project-at-17-billion-211283.html American Pacific Borate & Lithium Ltd (ASX:ABR) has delivered an exceptional definitive feasibility study (DFS) for its flagship Fort Cady Borate Project in California, US.

The DFS has evaluated mining of the Fort Cady borate deposit to produce a high purity (99.99%) boric acid (H3BO3) product along with sulphate of potash (SOP).

Importantly, the DFS forecasts an unlevered, post tax net present value of US$1.25 billion ($1.7 billion) and an internal rate of return (IRR) of 41%.

ABR is proposing to produce about 408,000 metric tonnes per annum of boric acid in multiple phases:

• Phase 1: 81,600 tonnes per annum (tpa) of boric acid with 36,000 tpa of SOP;
• Phase 2: Additional 163,000 tpa of boric acid with 36,000 tpa of SOP;
• Phase 3: Additional 163,000 tpa of boric acid with 36,000 tpa of SOP;
• End of phase 3 total production: 408,000 tpa of boric acid with 108,000 tpa of SOP.

The Fort Cady Borate Project had previously attained key mining permits for phase 1, including the environmental approvals for commercial-scale operations, which remain active and in good standing.

To capitalise on its large-scale borate ore reserve and mineral resource, ABR also plans on gaining the necessary approvals to expand the processing infrastructure and mine wellfield to accommodate phase 2 and phase 3 productions.

Boric acid and SOP, along with the by-products of gypsum and hydrochloric acid (HCl) will be transported in bulk by road and/or railroad to domestic consumers or to the ports in Los Angeles for export.

Mine gate to Port of Los Angeles

Operating both boric acid and SOP facilities enables the company to expand its sales markets, as boron is used as a micronutrient, and optimise boric acid operations by saving on input HCl requirements.

Alternatives for optimising boric acid production, additional boric acid related product stream and future lithium production are also planned.

Process alternatives have been evaluated for lithium future production, which will be based on utilising waste streams associated with boric acid production.

READ: American Pacific Borate & Lithium finalises DFS after updating resource

ABR chief executive officer and managing director Michael Schlumpberger said: “We believe the Fort Cady DFS demonstrates an outstanding boric acid and SOP project driven by low upfront capex, high margins and low technical risk.

“We are targeting a staggering US$321 million EBITDA in our first full year of production which makes our Fort Cady Borate Project a substantial mining project in a low risk, supportive jurisdiction.

“We intend to move quickly into a detailed engineering phase with a current target to commence construction in Q4 CY2019 subject to finance and permitting.

“The DFS certainly supports our ambition to become a globally significant producer of borates.”

Next steps

ABR aims to focus on the following over the coming months with a view to being ready to commence construction in Q4 CY2019:

• Commencement of detailed engineering for phase 1;
• Progressing financing discussions with a view to financing phase one before Q4 CY2019;
• Gaining necessary additional permits to enable production activities to commence that are likely to be necessary for the drawdown of construction finance;
• Working on a strategy to decouple the SOP operation from the broader operation that should provide additional financing options.

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Mon, 17 Dec 2018 15:20:00 +1100 https://www.proactiveinvestors.com.au/companies/news/211283/american-pacific-borate--lithiums-dfs-values-fort-cady-borate-project-at-17-billion-211283.html
<![CDATA[News - American Pacific Borate & Lithium finalises DFS after updating resource ]]> https://www.proactiveinvestors.com.au/companies/news/211018/american-pacific-borate--lithium-finalises-dfs-after-updating-resource-211018.html American Pacific Borate & Lithium Ltd (ASX:ABR) is finalising a definitive feasibility study (DFS) this month for its Fort Cady Borate Project in California after updating the project’s large JORC-compliant mineral resource estimate last week.

The update moved indicated resources into the measured category, increasing confidence in the resources to the highest level.

READ: American Pacific Borate & Lithium raises over $4 million to fund Fort Cady Borate Project

Fort Cady is the world’s largest borate resource not owned by big miner Rio Tinto (ASX:RIO) or Turkish state-owned borate company Eti Mine Works.

Fort Cady was mined by Duval Corporation in the 1980s, with American Pacific saying an examination of Duval’s production figures had showed “sustained production is possible from the deposit based on the cut-off grade utilised by the Duval.”

The significant borate resource at Fort Cady is made up of 120.4 million tonnes grading 6.5% boron oxide (11.6% boric acid equivalent) and 340 ppm lithium at a 5% boron cut-off.

Contained resources sit at 7.8 million tonnes boron or 13.9 million tonnes boric acid equivalent.

READ: American Pacific Borate & Lithium completes magnetotelluric survey at Salt Wells Projects

Australian-listed American Pacific further confirmed this confidence through testing this calendar year which “confirmed the lateral consistency of the mineralisation, as previously shown by the geological modelling”.

American Pacific managing director and CEO Michael Schlumpberger said on December 3: “The upgraded JORC-compliant mineral resource estimate moves approximately one-third of the Fort Cady Borate Project resource into a measured category – representing total contained boric acid of 4.63 million tonnes.

“This is a globally significant measured borate resource that will serve to underpin what we expect to be a very compelling DFS due to be completed and released shortly.

“This upgrade continues to reinforce our goal of becoming a globally significant producer of borates.”

American Pacific subsidiary, Fort Cady California Corp (FCCC), holds 72% of the total mineral resource estimate within an operating permit region in which FCCC has sole rights for commercial-scale mining.

The estimated measured resources now sit at 38.87 million tonnes at 6.7% boron (11.91% boric acid equivalent) and 379 ppm lithium at a 5% boron cut-off grade for 2.61 million tonnes of contained boron (4.63 million tonnes boric acid equivalent).

Indicated resources in the estimate are 19.72 million tonnes grading 6.4% boron (11.36% boric acid equivalent) and 343 ppm lithium (5% boron cut-off grade) for 1.26 million tonnes contained boric acid equivalent (2.24 million tonnes boric acid equivalent).

The inferred resources in the estimate are 61.85 million tonnes grading 6.43% boron (11.42% boric acid equivalent) and 322 ppm lithium at a 5% boron cut-off for 3.98 million tonnes contained boron (7.07 million tonnes boric acid equivalent)

READ: American Pacific Borate & Lithium adds acreage to exploration projects in Nevada

Earlier this year, American Pacific raised $4 million from sophisticated investors to support the Fort Cady project.

The company said in August 2018 it planned to use the funds to enable construction-related workstreams that would follow a final investment decision.

At the time Schlumpberger said the placement would ensure the company could quickly move the Fort Cady project from studies to construction-ready activities following completion of the DFS.

He said: “We have a very unique project that combines low capex, high margin, low technical risk and an earnings before interest, tax, depreciation and amortisation (EBITDA) profile of more than US$150 million per annum in full production into a borate market growing at 6% per annum, with limited visible supply.

“With borates non-substitutable in new world applications like electric vehicles, wind turbines, space shuttles and agriculture, we can only see our project becoming more valuable as the reality of a tight ongoing market with one dominant supplier continues.”

American Pacific’s Fort Cady DFS is due to be released this month.

The company also holds an exploration portfolio in Nevada, at the Salt Wells boron and lithium projects.

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Tue, 11 Dec 2018 23:20:00 +1100 https://www.proactiveinvestors.com.au/companies/news/211018/american-pacific-borate--lithium-finalises-dfs-after-updating-resource-211018.html
<![CDATA[News - American Pacific Borate & Lithium completes magnetotelluric survey at Salt Wells Projects ]]> https://www.proactiveinvestors.com.au/companies/news/206636/american-pacific-borate-lithium-completes-magnetotelluric-survey-at-salt-wells-projects-206636.html American Pacific Borate & Lithium Ltd (ASX:ABR) has completed a magnetotelluric (MT) survey over its Salt Wells Borate and Lithium Projects in Nevada, USA.

The survey covered 16 kilometres of ground and the results will be used to determine the location of the basement rock, indicating the potential for brines within the Salt Wells basin.

Analysis of the survey data will be undertaken by Zonge International after which ABR will delineate targets for a drilling program planned in the fourth quarter of 2018.

READ: American Pacific Borate & Lithium raises over $4 million to fund Fort Cady Borate Project

ABR chief executive officer Michael Schlumpberger said the results of the MT survey were a critical source of information.

“[They provide] a vital step that allows ABR to select the most prospective locations and higher-probability brine targets within the Salt Wells basin for the initial phase of drilling planned for the near future.”

READ: American Pacific Borate & Lithium adds acreage to exploration projects in Nevada

Salt Wells covers an area of 36 square kilometres with surface salt samples from the northern area recording up to 810 ppm lithium and over 1% boron, for a 5.2% boric acid equivalent.

The area is close to major highways and lies in what is believed to be an internally-drained, fault-bounded basin that appears similar to Clayton Valley, where lithium is currently produced by Abermarle Corporation.

Borates were produced from surface salts in the 1800s from the Salts Wells North site, and with the exception of recent surface salt sampling from the northern area, no modern exploration across the tenements has been completed.

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Tue, 09 Oct 2018 02:27:00 +1100 https://www.proactiveinvestors.com.au/companies/news/206636/american-pacific-borate-lithium-completes-magnetotelluric-survey-at-salt-wells-projects-206636.html
<![CDATA[News - American Pacific Borate & Lithium raises over $4 million to fund Fort Cady Borate Project ]]> https://www.proactiveinvestors.com.au/companies/news/201996/american-pacific-borate-lithium-raises-over-4-million-to-fund-fort-cady-borate-project-201996.html American Pacific Borate & Lithium Ltd (ASX:ABR) has completed an oversubscribed placement of $4 million at 20 cents per share to institutional and sophisticated investors.

The placement price was at a discount of 12.5% to the last sale price and 17.5% to the 10-day volume weighted average price.

Funds will enable construction-related workstreams to progress quickly once a definitive feasibility study (DFS) for its Fort Cady Borate Project in Southern California is complete.

The study is due in October 2018 and the company believes this will be a transformational event as it evolves to the development stage.

“Borate market growing at 6% per annum”

American Pacific managing director and CEO Michael Schlumpberger said the placement would ensure the company could quickly move the Fort Cady project from studies to construction-ready activities following completion of the DFS.

He said: “We have a very unique project that combines low capex, high margin, low technical risk and an EBITDA profile of more than US$150 million per annum in full production into a borate market growing at 6% per annum, with limited visible supply.

“With borates non-substitutable in new world applications like electric vehicles, wind turbines, space shuttles and agriculture, we can only see our project becoming more valuable as the reality of a tight ongoing market with one dominant supplier continues.”

READ: American Pacific Borate & Lithium adds acreage to exploration projects in Nevada

American Pacific management has committed an additional $200,000 worth of shares at the placement price subject to shareholder approval.

Following completion of the placement, the company will have more than $6 million cash on hand with no debt.

Fort Cady is the largest known contained borate mineral resource estimate in the world not owned by major borate producers Rio Tinto (ASX:RIO) and Eti Maden.

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Wed, 01 Aug 2018 03:53:00 +1000 https://www.proactiveinvestors.com.au/companies/news/201996/american-pacific-borate-lithium-raises-over-4-million-to-fund-fort-cady-borate-project-201996.html
<![CDATA[News - American Pacific Borate & Lithium adds acreage to exploration projects in Nevada ]]> https://www.proactiveinvestors.com.au/companies/news/201289/american-pacific-borate-lithium-adds-acreage-to-exploration-projects-in-nevada-201289.html American Pacific Borate & Lithium Ltd (ASX:ABR) has increased the size of its borate and lithium exploration projects in the US state of Nevada with the vendor agreeing to transfer 168 additional claims.

Transfer of the Salt Wells North and Salt Wells South projects brings the total project area of Salt Wells to 36 square kilometres and connects the company’s properties.

American Pacific is expected to begin the initial exploration program this quarter targeting high-grade boron and lithium.

No modern exploration conducted

American Pacific CEO Michael Schlumpberger said the additional 13.6 square kilometres fell under the company’s existing earn-in agreement and remained consistent with its objective to become a globally significant producer of borates.

He said: “The Salt Wells borate and lithium exploration projects contain a lot of unique characteristics of boron and lithium discoveries worldwide, including an arid climate, a closed basin containing a playa (dry lake bed) and suitable source rocks.

“Aside from salt surface sampling that recorded some very high-grade results (up to 810ppm lithium and over 1% boron), no modern exploration has been conducted on the project area.

“The consistently strong lithium and boron grades across the surface salt samples make this a very exciting opportunity in a global lithium and boron context that now has a lot more scale.”

Drilling to commence this quarter

The company’s initial exploration program will include 16 kilometres of magnetotellurics lines to determine basin structure and detect if brines are present in the basin.

This will be followed up by six shallow drill holes to determine the upper sediments and sampling of any intercepted brines.

Under the terms of the earn-in agreement, American Pacific may spend US$3 million on the projects over a 5-year period, with modest expenditure commitments required in the first two years.

The company is also required to pay all claim related expenditure which is estimated to be US$500,000 over the 5-year period.

Once in production, American Pacific will be required to make a one-off payment of US$1 million and an ongoing royalty of 3% of gross revenues.

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Mon, 23 Jul 2018 01:43:00 +1000 https://www.proactiveinvestors.com.au/companies/news/201289/american-pacific-borate-lithium-adds-acreage-to-exploration-projects-in-nevada-201289.html