Proactive - Interviews for investors

Hastings Technology Metals executive chairman on major Saudi deal & mining milestones

Hastings Technology Metals Ltd (ASX:HAS) executive chairman Charles Lew talks with Proactive’s Tylah Tully about the company’s latest developments at its flagship Yangibana Project and a newly signed memorandum of understanding (MoU) with the Ministry of Investment in Saudi Arabia. Lew provided a comprehensive update on the Yangibana Project, noting a 17-year mine life with reserves of 20 million tonnes. There will be 37,000 tonnes of concentrate sold annually to Chinese processors, supported by offtake agreements such as the one with ThyssenKrupp. Hastings has also completed critical infrastructure, including accommodation facilities, roads and an airstrip, alongside procuring key long-lead equipment for its beneficiation plant. Regarding the Saudi partnership, Lew explained that the MoU was part of the Vision 2030 initiative to diversify Saudi Arabia’s economy. Hastings aims to build a downstream rare earth processing plant using its proprietary technology to produce mixed rare earth carbonates, with future plans for oxide separation and magnet manufacturing. This partnership positions Hastings to play a significant role in developing a non-China rare earth supply chain. #ProactiveInvestors #HastingsTechnologyMetals #ASX #ASXHAS #RareEarths #MiningNews #SaudiVision2030 #ElectricVehicles #Magnets #NdPr #YangibanaProject #SustainableEnergy #Investing

Duration:: 14m
Broadcast on:: 28 Nov 2024
Audio Format:: other

Hello and welcome back to the Proactive Studio. I'm Tyler Tully, and today I'm joined by Hastings Technology Medal's executive chairman, Charles Liu, who's going to talk to us about the company, its flagship Yang Jibana project, and run us through its latest news. Charles, thanks for joining us today. Good morning, Tyler. Thank you for inviting me to this interview. So let's start at Hastings. Can you give us a background on the company and its role in the rare earth sector? Sure. So Hastings says a junior minor that goes back to 2014 in terms of my involvement when I commissioned the first drill on the ground to drill at Yang Jibana. At that time, there was nothing. It was a maiden drilling and discovered this amazing high NDPR to TRO or body, which means neodymium, presodymium, the two critical raw materials needed to make the super magnets or permanent magnets. TRO just stands for total rare of oxides. So this amazing old body has about 40% NDPR to TRO ratio. And compared to the average around the world, it is double what many of the other deposits have. We do have another project up north, it's called the Brockman in the Kimberley's. This is a heavy rail project. We are not doing any work on that other than to maintain the tenements there. That project has 42 million tons of a mainly heavy rail deposit called dysbrosium. And we are focusing our resources and management time on Yang Jibana, which we have been doing so over the last 10, 11 years since the discovery in 2014. Let's get more into Yang Jibana. Now, what work is currently being done at the project? And I guess what potential do you see there? We have been working on Yang Jibana since that first discovery. The last 10 years has involved the defining the resource and reserves that there are about 30 million tons of resource and 20 million tons of reserves. And it's a 17 years mind life. We will produce about 37,000 tons of a concentrate. That concentrate is going to be sold into China, where all the rail producers have lots of experience. And also the infrastructure is all there in terms of downstream into magnets. We get the best payability out of selling a concentrate into Chinese rail producers. And with the off take from Tissen Group, this German raw materials trading company, they are taking 67%, which is two thirds of our production and gives us the bankability for what we need when we talk about project finance to our lenders. So in the last 10 years, having done the drilling and all the metallurgy test work, we also have in 2017 signed a voluntary and native title agreement with the traditional owners of Yang Jibana. And we had the both state and federal government permits. The infrastructure was built over the last couple of years. And so what we have at Yang Jibana is the entire non process infrastructure. And what that means is just the 295 room accommodation village, about 20 plus kilometers of internal road infrastructure, a 1.8 kilometer airstrip and an aerodrome attached to it, of course, and also the water balls and the telecoms infrastructure. So if you look at our website, you'll see all the photos, all the infrastructure has been built. In addition to that, we have also procured all the equipment needed to start construction of the manifestation plant, which is going to happen next year. All the equipment, like the big items, particularly the segment that has already been procured and sitting at our warehouses in Perth. In addition to that, we have also procured the hydromet equipment, which primarily the rotary kiln, the off gas scrubbers. These are long, long lead time equipment. It takes about two years just to fabricate it. And all that has been purchased two years ago, sitting at our warehouse. And on the back of the news that we announced today, in terms of developing our second stage, which is the hydromet stage, we will be taking that equipment into Saudi Arabia. We can talk more about that in a moment. Yeah, well, let's talk about it. And now you've signed an MOU with the Ministry of Investment in Saudi Arabia. What can you tell us? So we, I have been visiting Saudi, I'm talking to Saudis over the last 12 months. The government has what they call the Vision 2030 agenda. That agenda is to diversify the country's economy away from fossil fuels, right? Oil. And we are working on things that are related to sustainability and electrification and renewable energy, which is what magnets is for. They power wind turbines, they power electric vehicles. And the government approached us as they did approach a number of other potential rare earth miners to work in their country and develop that downstream mine to magnet strategy. Now, what we offer them is the fact that we have a process flow sheet for the second stage of the development of mine to magnet, which is the hydromet plant. And that hydromet plant is to produce a carbonate. And then it goes to the third stage, which is then rare earth oxide separation. And we have partnered with JL mag. JL mag is for the world's largest magnet maker, as well as they have very advanced sophisticated technology in magnet manufacturing, 50% of the world's electric vehicle traction motor market is dominated by JL mag. And what we are looking to do with the support of the Saudi agreement, Saudi government, when we signed this MOU with the Ministry of Investment, is to start with the hydromet, which is using Hastings proprietary technology in the cracking and leaching. And the feedstock will come from Jan jibana as well. And there is feedstock coming from the Saudi itself that they are working on. And the intention is to therefore produce a carbonate, a mixed rare earth carbonate. And then to build also the oxide separation plant, the rare earth oxide separation plant. The next stage is to build the the the rare of metalizing of the oxides into then a magnet plant. So there are a number of stages. The signing of the MOU basically identified has identified Hastings as the party that the government will work with to develop this downstream and to build the facility and also to operate it. So we will identify, you know, will work with the government to identify the suitable joint venture partners in Saudi Arabia. And the end result of it is basically a joint venture relationship with Saudi entities, the Saudi government owned enterprise. We don't know exactly who they are. We've met a number of them already. We are the next stage is to go into joint venture negotiations. So I'm very excited about this opportunity simply because when we first started off at Jan jibana going back 10 years ago when we developed the process flow sheet, we develop a flow sheet for both beneficiation as well as hydromet. And we'll, you know, our intention has always then to produce a carbonate, which will then go on to oxide separation. And the oxide separation would be a third party that we will work with. What we have now is the fact that we will build that beneficiation plant in Australia. And with the support of the Saudi government, therefore it will lighten the financial burden on Hastings, build a hydromet plan to a joint venture, and also into oxide separation as well. So we have effectively captured the entire value chain starting from the concentrate in Australia, a carbonate and an oxide in Saudi Arabia. And if the opportunity presents itself, we will also see how we can be a participant and financial investor in the metal, metalizing into magnets facility. So it is all, you know, a very big project. The amount of money budgeted from the agreement or rather the MOU that we signed is about one to one and a half billion. Sorry, I should say it's about just under two billion US dollars for the entire mine to magnets. But the total program that the Saudi government talk about, which is the what you call the GSCRI program, which is the global supply chain reliance initiative, it's about $9 billion at their total of nine companies that were selected to be in the program. They are in different, different types of industries, ours is mine to magnet supply chain. And we are very, very pleased and delighted to be able to partner with a government that has a vision of of being mine to magnets. And of course, I should also mention the fact that Hastings has a 21% shareholding in new new performance materials. And Neil is a magnet maker listed on the Toronto Stock Exchange with a magnet plan, Estonia as well as China and Thailand. I mean, clearly, you've just listed several reasons there, but run us through your investor case and why you think that investors should be attracted to Hastings. Well, there's a good question, Tyler. If you look at the share price of Hastings over, just take the last three, four years, when NDP price was at $170, our share price was at about $5, $5.50. That was in 2021. Since then, with high interest rates and a slowdown over the COVID period or in consumer demand, the NDP price started to slide back. Today, the NDP price is sitting at about $60. Our share price is sitting about 30 cents, although today on the back of the Saudi news is popped up 10, 12% or 15%. And I think what I can say at this point in time is that the market is not fully aware of some of the things that we are doing that are strategically very significant. And these strategic moves like the one that we announced today, about three months ago, we announced the partnership with JLMag. JLMag is investing 10% into Hastings. And that relationship with JLMag and our investment in NIO and the Saudi downstream that we are looking at is all part of the vision of mine to magnets that we have been talking about for the last two, three years. And in time to come, because these things do take a long time to assemble or to package together as a mine to magnet single enterprise, what we have today is that we have NIO. We have the rare of coming from Hastings, which is clearly critical. And we have the Saudi government and Saudi enterprises that we work with for a joint venture to participate in that entire value chain such that together with the parties that are named, we can bring a mine to magnets into the market whereby the European OEMs and tier one supply, component supplies as well as in North America. And even in places like Japan or Korea, they're all looking for a non-China magnet. And if we can end up making magnet in Saudi Arabia and the supply to these regions in the world, that will be the dream that come true. Yeah, it definitely sounds like Hastings has poised for some rapid growth and you've been very busy. So thanks so much for sharing your insights today and talking us through a bit about the company. Thank you very much, Tyler.