The PFS has confirmed FYI’s objective to become a predominant vertically-integrated, long life producer of high-purity alumina (HPA).
FYI’s PFS indicates that the project could produce up to 8,000 tonnes per annum of HPA with both low capital and operating costs, delivering a net present value (NPV) of US$506 million for a 25-year project life.
The PFS economic forecasts are based on a revised Cadoux resource estimate that was specifically estimated for the delivery of premium quality feedstock to the integrated HPA refining process.
The mining and financial modelling is based on using 94% Indicated and 6% Inferred material.
FYI managing director Roland Hill said: “The PFS demonstrates FYI Resources is in the attractive position with the potential of becoming a long-life, low cost and high margin HPA producer.
“The positive economics are a result of realistic basket pricing and a production profile that is expected to meet the forecasted industry demand growth over the coming years as a result of the electric vehicles revolution.
“Importantly, we believe we should sit within the lowest operating cost quartile generating significant margins, demonstrated in the average annual EBITDA at steady state of US$128 million.”
Global HPA demand
The global HPA demand is expected to increase from around 35,000 tonnes in 2017 to 125,000 tonnes in 2025, driven primarily by the strong growth in demand for lithium-ion battery (LIB) separator coating.
One of the drivers of the LIB separator growth is the growth of electric vehicles (EV), particularly as a result of China’s new pro-EV policies.
Total HPA demand by end-use sector (tonnes)
With regards to the future funding of the Cadoux Kaolin Project, FYI is in discussions with industry participants with the potential to provide financing as part of an offtake, in addition to traditional means of debt and equity financing.
The company plans to initiate a bankable feasibility study (BFS) whilst progressing negotiations with industry participants for potential offtake deals.