Hexagon Energy Materials Limited (ASX:HXG)
(“
Hexagon” or the “
Company”) is
pleased to announce strong shareholder support for its updated
business strategy. Shareholders voted overwhelmingly to support the
change of the Company’s name to
Hexagon Energy Materials
Limited, reflecting Hexagon’s expanded strategy to include
downstream rare-earth processing; rare-earths also being a critical
component of the high-growth renewable-energy, energy-storage and
electric-vehicle sectors.
At the Company’s Annual General Meeting on November 22, 2019,
Chairman Charles Whitfield told shareholders, “We believe that the
RapidSX™ rare earth element (“REE”) separation
technology, developed by Innovation Metals Corp.
(“IMC”) that Hexagon has optioned has the
potential to transform the rare earths value chain as it
fundamentally changes the economics around new REE project
development. At the same time, Western businesses and governments
are becoming increasingly focused on security of supply and the
RapidSX process could unlock resources and supply chains to provide
a competitive alternative for industry.”
Hexagon’s Managing Director, Mike Rosenstreich
commented, “Picking up on Charles’ remarks at the AGM and
given the strong support for Hexagon’s expanded strategy and entry
into REE processing, we plan to start funding development of the
Commercial Demonstration Plant forthwith.”
“Initial work will comprise finalization of the capital budget
and schedule leading to commencement of front-end engineering and
design work so that ordering and construction can commence early in
Q1 of 2020. To earn our 49% interest in American Innovation
Metals Inc. (“AIM”), we need to fund the
US$2 million build-out of the Demonstration Plant and global patent
applications.
We are very excited by this opportunity and with shareholder
endorsement we want to get on with it. We look forward to working
with IMC’s principals to commercialize the RapidSX approach to meet
the wide interest that we are aware of from both existing REE
producers and advanced project sponsors.”
Background: Investment into American Innovation
Metals
More than 99% of votes cast at the recent Annual General Meeting
of Hexagon Shareholders were for a change in the nature and scale
of the Company’s activities through the acquisition of a 49%
interest in AIM, a special purpose vehicle to commercialize the
RapidSX processing technology, which separates the REEs contained
in chemical concentrates produced by mine-site operators, to
subsequently produce rare-earth oxides (“REOs”)
for use by various downstream manufacturers. The RapidSX technology
was developed by private Canadian company IMC, the 51% partner in
AIM.
For more information about Hexagon's REE business with IMC,
please refer to the Company's October 10, 2019 announcement
entitled, “Hexagon Enters Rare Earths Downstream Processing
Industry”.
AIM InvestmentHexagon has a binding Investment
Agreement to acquire 49% of the RapidSX technology for REE
separation through AIM. The key points are:
- Investment is US$6.0M, comprising:
-
- US$2.0M to build out a Commercial Demonstration Plant
(“CDP”) within 12 months; and
- US$4.0M in deferred payments, payable through Hexagon’s share
of future AIM cash flows.
- Hexagon will contribute commercial and marketing skills,
identify/secure feedstocks, generate RapidSX licencing
opportunities, and sales/offtakes for REOs produced.
The CDP is planned to be financially self-sustaining following
the initial investment for the build-out. Ultimate
commercialization could follow-on quickly centred on licensing
agreements with interested producers.
REE and Separation Technologies
REOs such as oxides of praseodymium, neodymium, terbium and
dysprosium are the precursors used in the production of REE
permanent magnets (“REPMs”). REPMs are critical
components for more efficient traction motors for electric
vehicles, and direct-drive wind turbine generators for renewable
power generation, as well as several key defense and high-tech
industrial technology applications.
Hexagon considers that REE separation for the production of REOs
is the key supply-chain constraint with approximately 85% of REOs
produced in China in an opaque and highly controlled market. The
dominant separation technology employed for REE separation is
solvent extraction (“SX”) which in its
conventional form, is highly capital intensive requiring a very
large plant footprint to accommodate up to 1,500 individual
mixer-settler units to achieve the desired separated REE
products.
RapidSX is a form of accelerated SX which IMC has developed and
operated successfully at pilot scale for various mixed REE chemical
concentrate types, with financial support from the United States
Department of Defense. The pilot program demonstrated significant
(approximately 70% to 90%) capital cost savings on the equivalent
conventional SX separation plant, as well as reduced operating
costs. Table 1 below highlights the advantages of RapidSX over
conventional SX — the only proven, commercial and established REE
separation technology. Table 1: Features of RapidSX
compared to conventional SX circuits
|
RapidSXTM |
Conventional Solvent Extraction |
Comment |
Performance & Efficiency |
|
Commercial Purity |
Yes |
Yes |
- Increased Separation Kinetics Faster metals separation
- Agnostic on feedstock type Robust process capable of taking
LREE-rich, HREE-rich and even blends of mixed REE feedstocks
|
REE Recovery Rates |
High |
High |
Processing Time |
Rapid |
Slow |
Time to Equilibrium |
Days |
Several Weeks |
CAPEX |
|
Equipment Cost |
Low |
High |
- Considerably reduced footprint
- Commercially Available All construction materials, equipment
and chemistry are readily available with no ‘black-box’
technology
|
Separation Staging |
90% Reduction |
Very High |
OPEX |
|
Metal Inventory/WIP |
Low |
High |
- Low Costs <US$2/kg for LREOs*<US$12/kg for HREOs*
- Significantly reduced separation times
* Estimated OPEX figures from IMC RapidSX pilot test program |
Organic Volumes |
Low |
High |
Labor |
Low |
High |
Power Consumption |
Low |
High |
|
|
|
|
About Hexagon Energy Materials LimitedHexagon
Energy Materials Limited is listed on the Australian Securities
Exchange (“ASX”) under the ticker code “HXG”. The Company holds a
100% interest in the McIntosh Graphite Project in Western Australia
and an 80% interest in the Ceylon Graphite Project in Alabama, USA.
With a current focus on the downstream processing of graphite and
other energy materials, Hexagon has attained formidable technical
knowledge based on test work of its McIntosh project flake-graphite
material, which is applicable and highly valuable for a range of
specialty-material applications. The Company’s focus is on creating
sustained shareholder value by maximizing near-term growth
opportunities to commercialize that downstream business in the USA,
where it has forged strong technical, commercial and investor
relationships.
Learn more at www.hexagonresources.com
Forward-Looking StatementsThis news release
contains projections and statements that may constitute
"forward-looking statements" within the meaning of applicable
United States, Canadian and other laws. Forward-looking statements
in this release may include, among others, statements regarding the
future plans, costs, objectives, or performance of Hexagon Energy
Materials Limited or the assumptions underlying any of the
foregoing. In this news release, words such as "may", "could",
"would", "will", "likely", "believe", "expect", "anticipate",
"intend", "plan", “goal”, "estimate," and similar words, and the
negative forms thereof, are used to identify forward-looking
statements. Forward-looking statements are subject to known and
unknown risks, uncertainties and other factors that are beyond the
control of Hexagon Energy Materials Limited, and which may cause
the actual results, level of activity, performance or achievements
of Hexagon Energy Materials Limited to be materially different from
those expressed or implied by such forward-looking statements. Such
risks and uncertainties could cause actual results, plans and
objectives of Hexagon Energy Materials Limited to differ materially
from those expressed in the forward-looking information. Hexagon
Energy Materials Limited can offer no assurance that its plans will
be completed. These and all subsequent written and oral
forward-looking information are based on estimates and opinions of
Hexagon Energy Materials Limited management on the dates they are
made and expressly qualified in their entirety by this notice.
Except as required by law, Hexagon Energy Materials Limited assumes
no obligation to update forward-looking information should
circumstances or the estimates or opinions of Hexagon Energy
Materials Limited management change.
North American Media and Investor Relations
Contact:
G&W Communications Inc. telephone: +1
416 915 3150email: hexagon@g-w.ca
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