High Purity Alumina is very pure aluminium oxide (99.99% Al2O3).  Alumina is also known as corundum, with traces of iron, titanium, vanadium or chromium it forms sapphire and ruby. HPA is chemically inert, transparent, does not conduct electricity, has a very high melting point and is very hard.

In pellet form HPA is used to make synthetic sapphire, which is used as an LED and semiconductor substrate and as a tough scratchproof glass used in smart phones and watches. In powder form it is used in lithium ion batteries as a flame-retardant separator and as a coating in fluorescent lighting.

HPA has been most commonly made by manufacturing aluminium alkoxide from aluminium metal and alcohol. HPA is then produced by the hydrolysis of the alkoxide. Today processes have been, or are being, developed to produce HPA directly from a feedstock such as aluminous clay.

The most common feedstock is kaolin, which is primarily kaolinite (Al2Si2)5(OH)4). Kaolin can be almost free of impurities which make it an ideal feedstock to produce HPA. All the companies below are planning to make HPA from kaolin.

The HPA market is small, around 45,000tpa, but high value. HPA 99.99% (4N) is USD20,000 – 30,000/t. The market is expected to grow rapidly with continued strong growth in the LED market and expected strong growth in the lithium ion battery sector.

Kaolin itself has a number of uses, such as in paper, ceramics, rubber, fibre glass and paint, and if good grade and purity can be sold as direct shipping ore (“DSO”).However it is generally refined before sale.

Of the stocks listed below, Altech is the most advanced with an HPA plant under construction in Malaysia. Two others, Alpha HPA and FYI Resources, have constructed and successfully operated pilot plants and completed Pre-feasibility studies.

Accelerate Resources (ASX: AX8)

Share Price Year High/Low Shares on Issue Market Cap
$0.034 $0.09/$0.028 41M $1M

Holds the Tambellup kaolin project near Albany in WA, purchased from Nova Minerals. There is no JORC resource as yet and the project came with rights to the “Griffin Process” to make HPA.

Alchemy Resources (ASX: ALY)

Share Price Year High/Low Shares on Issue Market Cap
$0.012 $0.18/$0.01 550M $7M

The West Lynn nickel cobalt project is overlain by 6.6Mt of clay (kaolin?) at 20.8% Al2O3. The company has several other gold and base metal projects.

Altech Chemicals (ASX: ATC)

Share Price Year High/Low Shares on Issue Market Cap
$0.11 $0.145/$0.083 761M $84M

The company is constructing an HPA plant at Johor in Malaysia. Mitsubishi has entered into off-take agreement for the first 10 years of production.  The plant will be fed by the company’s kaolin mine near Meckering in WA. It hosts a reserve of 1.2Mt @ 30% Al2O3 within a resource of 12.7Mt @ 30% Al2O3.

Andromeda Metals (ASX: ADN)

Share Price Year High/Low Shares on Issue Market Cap
$0.05 $0.082/$0.005 1,444M $72M

The company’s Careys Well project (right to earn up to 75% from Minotaur Exploration) in SA hosts a 20Mt resource of combined kaolin and halloysite. Alternatives for sale are DSO, refined kaolin/halloysite compound, or HPA4N.  A scoping study has been completed that returned an NPV (8%) of AUD413M. The company is hoping to commence production in mid-2021 using third party feedstock.

Alpha HPA (ASX: A4N)

Share Price Year High/Low Shares on Issue Market Cap
$0.19 $0.205/$0.082 632M $120M

The company has built and successfully operated an HPA pilot plant in Brisbane. The process involves solvent extraction, Al salt crystallisation, HPA-precursor production, and calcination to HPA. Samples have been sent to several potential end users. A DFS is expected to be complete by the end of 2019.

FYI Resources (ASX: FYI)

Share Price Year High/Low Shares on Issue Market Cap
$0.056 $0.086/$0.036 212M $12M

The Cadoux project in WA has a reserve of 2.89Mt at 24.4% Al2O3. A PFS completed in 2018 returned an NPV (10%) of USD506M. The company completed a pilot  plant in Perth in 2019 and has already produced HPA 4N, which has been tested in the US as averaging 99.991%.

Metalsearch (ASX: MSE)

Share Price Year High/Low Shares on Issue Market Cap
$0.013 $0.022/$0.003 1,084M $14M

The company acquired the Abercorn kaolin project, located in Queensland,  late in 2019. The mineralisation has been drilled but there is not yet a JORC resource. The company also has nickel-copper projects in Botswana.

Red Mountain Mining (ASX: RMX)

Share Price Year High/Low Shares on Issue Market Cap
$0.007 $0.008/$0.003 847M $6M

The company plans to acquire the Mt  Kokeby kaolin project in WA. There is no JORC resource but it has previously been mined. Recent samples returned Al2O3 grades over 30% which suggests  the kaolin may be suitable for direct shipping. The company also has copper-cobalt projects in Africa.

03 December 2019 Commodities, Companies