Blackstone Update on Refinery Byproduct Offtake Strategy

Blackstone Minerals Limited (ASX: BSX) (“Blackstone” or the “Company”) is pleased to announce an update to its recent refinery byproduct offtake MOU announcement.

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KEY POINTS

• Blackstone Minerals Limited (“Blackstone” or the “Company”) has progressed the Ta Khoa Refinery (“TKR” or “Project”) byproduct offtake strategy (refer ASX announcement 21 December 2023). The Company has signed a non-binding Memorandum of Understanding (“MOU”) with three Vietnamese companies to sell Ta Khoa Refinery byproducts, being manganese sulphate (or epsomite) and sodium sulphate. The identified companies include Vietnam Chemical Group (“VinaChem”), PV Chemical and Equipment Corporation (“PVChem”) and Nam Phong Green Joint Stock Company (“Nam Phong”);
• The offtake arrangements would create a pathway for Ta Khoa Refinery byproducts to enter the market as well as significantly improve revenues for the Ta Khoa Project, thus improving project financial credentials and operating costs (net of byproduct credits);
• The identified companies are also chemical suppliers, capable of suppling the necessary reagents to the Ta Khoa Refinery to convert nickel sulphide concentrate (and other intermediate products) into precursor cathode active material (“pCAM”) NCM811;
• Blackstone has signed a non-binding MOU with Development for Resources Environmental Technology Joint Stock Company (“DRET”) to investigate opportunities to repurpose and trade waste material (or residue) from the Ta Khoa Refinery into construction material products;
• Execution of residue offtake agreement/s will yield significant cost savings for the Project as it will reduce capex associated with on site storage requirements and improve revenue.

For a video summary of the announcement head to the Blackstone Investor Hub https://investorhub.blackstoneminerals.com.au/link/4PK1xe

Byproduct Offtake & Reagent Supply Agreements

The Company has signed non-binding MOUs with three Vietnamese companies to develop opportunities to trade byproducts produced from its Vietnamese Ta Khoa Refinery.

The refinery will produce three different byproducts, these are:

• copper cathode (LME grade),
• magnesium sulphate in the form of epsomite,
• sodium sulphate.

Although copper cathode can be sold directly on the London Metal Exchange (“LME”), buyers of epsomite and sodium sulphate need to be identified locally. Blackstone has entered into non-binding MOUs with chemical companies/traders being, VinaChem, PVChem and Nam Phong, who are interested in the purchase of both the epsomite and sodium sulphate byproducts.

The TKR prefeasibility study did not consider epsomite and sodium sulphate as ‘cash generating’. The inclusion of epsomite and sodium sulphate as a saleable byproduct will improve revenues for the TKR DFS, thus improving project financial credentials and operating costs (net of byproduct credits).

The engaged companies will use TKR byproducts to produce products such as fertiliser, detergents, construction materials and other chemical products. These products are then used in Vietnamese and global industries such as, but not limited to, agriculture, construction, industrial cleaning products, medical, textile, chemical, paper and glass manufacture.

Importantly, the engaged companies can take the full amount produced by the refinery. The Companies confirmed the byproduct volumes produced from the refinery are only a small portion of what is currently being imported into Vietnam, demonstrating offtake security. Blackstone believes it has a competitive advantage to displace the imported epsomite and sodium sulphate products given its location within Vietnam.

In addition, the MOU also covers the supply of refinery reagents to allow the conversion of nickel concentrate feed into pCAM NCM811. Blackstone has been investigating the capability of these Vietnamese companies to supply high quality reagents to the Ta Khoa Refinery, reducing supply risk for the project. This strategy aligns with previous announcements to explore and contract local companies to assist with project development and execution (refer ASX announcement 20 July 2023).

Site visits were conducted in December 2023 (refer ASX announcement 21 December 2023) to investigate the capability of these companies. It was pleasing to see that these companies service both local and international customers, are ISO accredited and were able to demonstrate high quality of operation and safety standards.

Click here for the full ASX Release

This article includes content from Blackstone Minerals, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.

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