American Pacific Borate & Lithium Ltd (ASX:ABR) has received confirmation from both Sinochem Group and Sinomach that samples provided from the Fort Cady Borate Project are in line with expectations for high grade boric acid.
ABR had entered into strategic cooperation agreements with subsidiaries of Chinese state-owned enterprises (SOE) Sinochem Group and Sinomach to negotiate an initial five year off-take agreement subject to ABR providing samples for testing.
Samples from final test works from the Fort Cady Borate Project were provided to both Sinochem and Sinomach in June 2019.
Both companies are amongst the Fortune Global 500 list of companies
ABR has now received confirmation from both entities that the samples have been tested and are in line with expectations for high grade boric acid.
Importantly the product samples had very low levels of calcium that easily exceeded specifications.
As a result of the above, ABR has now agreed to move forward with the binding off-take contract discussions.
The company is also considering accelerating its boric acid ramp up by commencing with a larger initial boric acid operation with financing supported by binding bankable off-takes with the Chinese SOEs.
ABR CEO and managing director Michael Schlumpberger said: “This is another important milestone for us as we move forward with our plans to construct our very compelling Fort Cady Borate Project.
“We have now established we have large buyers of our product that can provide bankable off-takes to support financing activities.
“Importantly this provides additional options and the potential for us to increase the size of our initial boric acid operations as we move forward with our aspiration to become a globally significant producer of borates.”