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Beyondie sulphate of potash (SoP) project expansion, Australia – update

Image of potash

Photo by ©Reuters

12th January 2024

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor

     

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Name of the Project
Beyondie sulphate of potash (SoP) project expansion.

Location
Western Australia.

Project Owner/s
Reward Minerals opened a 2:1 renounceable entitlement offer on January 10, 2024, seeking to raise $22.789-million before costs to support the acquisition of the Beyondie project, which was approved on January 9, 2024.

Reward announced in December 2023 that it had entered into a binding share sale agreement with the receivers managers of Kalium Lakes to acquire Beyondie on a debt-free basis, free  of  encumbrances  for  a total  consideration  of  A$20 -million. The share sale agreement involves the acquisition of 100% of the issued share capital of Kalium Lakes Infrastructure and Kalium Lakes potash, which are under administration.

Project Description
The project is based on expanding existing infrastructure where required, for instance, the brine extraction and evaporation ponds, combined with a process plant debottlenecking and optimisation.

Production is estimated at 120 000 t/y, which is inclusive of the 90 000 t/y and 100 000 t/y production targets previously announced by previous owner Kalium Lakes.

The additional brine will initially come from the expansion of Beyondie’s Sunshine and Ten Mile borefields and, subsequently, the incremental expansion of the Ten Mile West trenches and borefield during the next 15 years.

Significant opportunity exists for further expansion beyond 120 000 t/y, with further studies in progress.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an unlevered net present value, at a nominal 8% discount rate, of $484-million.

Capital Expenditure
The project will require incremental capital expenditure of $45.3-million.

Planned Start/End Date
Production of 120 000 t/y is expected by the fourth quarter of 2022.

Latest Developments
After gaining shareholder approval for the acquisition of project Reward Minerals is seeking to raise about A$22.8-million through an entitlement shares offer.

The capital raise will allow for completion of the Beyondie transaction and for the company to start research and development activities on site, including mining studies and pilot recovery trials.

Reward is planning to do a 12-month care and maintenance phase – during which operational challenges will be addressed – for the project.

Reward aims to develop an operational strategy for Beyondie in the near term – the company believes the current flowsheet and unit operations can be simplified to enable significant cash flow generation from production at the site.

The Beyondie project has all infrastructure already in place for production, as well as numerous granted mining and exploration licences. 

Reward concluded a share sale agreement with the owners of the Beyondie project, Kalium Lakes, in November 2023.

The share offer involves two new shares for every one share held on the record date at an issue price of A$0.05 apiece, together with one free-attaching quoted option, which is exercisable at A$0.10 for three years from the issue date.

Notably, the offer is partially underwritten for A$16-million by RM Corporate Finance.

Reward explains that Reward may underwrite the entitlement offer for a higher amount up to the full subscription amount, should it be able to secure subunderwriting commitments for additional underwriting; however, this is not guaranteed.

The eligible shareholders for the offer are those whose registered address is in Australia or New Zealand.

Reward expects the capital raise to be completed by January 30.

Key Contracts, Suppliers and Consultants
SRK (independent technical adviser for senior lenders).

Contact Details for Project Information
Kalium Lakes, tel +61 8 9240 3200 or email info@kaliumlakes.com.au.

Edited by Creamer Media Reporter

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