Breakaway Research publishes report on Altech Chemicals’s HPA project

Breakaway Research publishes report on Altech Chemicals’s HPA project.

Following a change of management and name, Altech Chemicals (previously Australian Minerals and Mining Group) has recently commenced a BFS on its 4,000tpa HPA project. Work over recent years has developed a patented, low cost acid leach process that has produced HPA of the requisite quality.

As a result of the recent Integrated Plant Study (“IPS”) Altech has published estimated operating costs in the order of $8,600/tonne of 99.99% purity HPA for a small scale plant, which is significantly lower than our estimated current industry average costs of ~US$ 14,000-17,500/tonne for the equivalent product, and could be a potential game changer for the industry Ideally positioned to enter the rapidly expanding high purity alumina (“HPA”) market which is expected to grow at ~27% CAGR over the next 4 years to around 48,000tpa.

Key points:

• Low cost acid leach process developed from well understood technology to treat high purity aluminous clay feedstock
• Operating costs potentially up to 40% lower than current average industry cost, placing Altech as a first quartile producer
• Feedstock source at Meckering in WA owned 100% by Altech
• Proposed plant operations in southern Malaysia–low operating and capital cost environment
• Board and Management with broad technical and financial experience in the alumina and chemicals industries, and significant holdings in the Company
• Current 1 for 4 rights issue at 10c–closes December 15, 2014
• Base case post rights issue valuation range of $0.13 to $0.36/share, this is a risked valuation to reflect project stage