Yendon - HPA

HPA Project

The Yendon HPA Project is currently on care and maintenance following the company's focus on gold exploration. The work completed to date is:

  • Scoping level metallurgical test work – Completed – Read the full ASX announcement.
  • JORC Resource – Completed – Read the full ASX announcement.
  • Pre-feasibility Study – Completed

Pre-feasibility Study (PFS)

The results of the Pre-feasibility Study (PFS) showed very strong financial and technical results. The financial results were:

Annual HPA Production 8,000 tpa +99.99% Al2O3
Capital Cost* $271 million (incl contingencies of $53m)
Capital Cost per t of HPA $33,875 based on 8,000 tpa HPA
Average Cost of Production $7,668 /tonne of HPA
Forecast Sale Price $25,200 /tonne
Average EBITDA $133m per annum
Payback Period 4.1 years
Project NPV @ 10% $692m
IRR 34%

* All monetary amounts are in USD

The PFS results are underpinned by:

  • a substantial high-grade kaolin resource near Ballarat, Victoria that contains low levels of deleterious impurities;
  • a shallow open pit mine design with low stripping ratios, which can be efficiently contract mined without blasting, crushing or grinding;
  • simple beneficiation by screening the kaolin ore at the mine site to remove 57% of the ore mass comprising mainly coarse silica, upgrading the ore to a 35% kaolin concentrate for transport to the hydrometallurgical process facility (HPF);
  • significant metallurgical test work which has defined a robust chemical process to convert Yendon kaolin to HPA. This process is based on the industry-standard process derived from the US Bureau of Mines published and public data customised by Hill End specifically for the Yendon orebody;
  • confirmation via this developed chemical process that Yendon kaolin can produce HPA exceeding 99.99% Al2O3;
  • development of a simple and effective process flow diagram using commercially proven, and largely "off the shelf", operations that result in competitive capital and operating costs to produce HPA with low environmental impact; and
  • adoption of a conservative HPA selling price of $25,200/ tonne for 99.99% HPA over the life of the project, which is at the bottom end of the current HPA market price range as established by independent market analyst Roskill.

Industry specialists

The PFS was managed by Primero, with the following industry specialists undertaking studies in their fields of expertise:

  • Metallurgical process – BHM Process Consultants
  • Metallurgical test work – ALS Laboratory Group
  • Flowsheet design – Primero
  • Capital and operating costs – Primero
  • JORC Resource – SRK Australia
  • Environmental – SRK Australia
  • Mine design – Mining Plus
  • Beneficiation plant – Primero

Yendon - Kaolin

Kaolin Resources

Peak Minerals own 100% of 3 exploration licences and one Retention license in the Ballarat area in Victoria. The Retention license sits over parts of the Exploration licenses and covers the defined resource.

Following an extensive drilling program in Q3 2017, a JORC 2012 Resource of 3.68 mt of kaolin in situ was outlined. The ore is easily beneficiated at the mine site using screening, with the -63um fraction containing 95% of the kaolin. This reduces the volume by up to 57% with minimal loss of available Al2O3, leading to significant cost reductions in processing infrastructure and logistics.

Table 1: Yendon Kaolin Mineral Resource estimates - January 20181

table-1-yendon-kaolin-august-2018.png
Note: The estimates are based on a block cut-off concentrate grade of >= 30% Al2O3.

The Concentrate Tonnage of 1.59 mt grading 34.7% Al2O3 is sufficient for a project life of 38 years based on the PFS results. Subsequent drilling has extended the known deposit to the north, providing significant confidence that we can either prolong the project life or expand production within our current tenements.

Samples recovered from Aircore drilling program

Pictured above: Samples recovered from Aircore drilling program

Drill core from diamond drilling

Pictured above: Drill core from diamond drilling

pure-alumina-kaolin-drill-open-pit.jpg

Pictured above: Existing open pit kaolin mine along strike from the Yendon deposit, owned by Imerys.