➤ ABx Group Ltd. identified two business opportunities from its original bauxite work that focus on the value chains for aluminum and critical minerals.

➤ Providing Australian aluminum smelters with a domestic source of aluminum fluoride reduces potential geopolitical risk, as the product is mostly imported from China.

➤ ABx Group is developing ionic clay rare earths processing technology rarely seen outside China to help diversify supply chains.

Mark Cooksey, ABx Group managing director and CEO. Source: ABx Group Ltd.

ABx Group is developing a process to recycle a type of aluminum smelter waste into a high-value chemical essential for aluminum smelting, through its 83%-owned subsidiary ALCORE Ltd. The technology recovers fluorine from "excess bath" to produce hydrogen fluoride, ahead of further reacting the hydrogen fluoride to produce aluminum fluoride.

ALCORE recently completed the preliminary engineering design phase for its pilot plant to recover fluorine from the excess bath in New South Wales, Australia.

ABx Group is also the first company to discover rare earths in Tasmania, Australia, with the resource estimate for its Deep Leads-Rubble Mound project increasing to 27 million metric tons of ore in July. The project hosts ion adsorption clay deposits containing rare earth elements. ABx Group started drill testing a new discovery 5 km northeast of Deep Leads on Aug. 17.

S&P Global Commodity Insights interviewed Mark Cooksey, ABx Group managing director and CEO, about what the company's fluoride technology means for aluminum producers and its progress in rare earths. The following conversation has been edited for clarity and space.

S&P Global Commodity Insights: You have an ionic clay deposit and a hydrogen fluoride extraction technology. Is there a link or an overall strategy in that portfolio?

Mark Cooksey: The link is where they came from — our bauxite work. From when we listed in 2009 as Australian Bauxite Ltd. until 2018, we were about exploring for and producing bauxite. We reanalyzed our old assays from old bauxite samples and found some good rare earth results, then started drilling for that in late 2021. In 2022, we declared our first resource at Deep Leads.

Bauxite normally is sold to refineries to make alumina, but that can be a tough market to crack as you're competing with huge bauxite mines. We were aware of some clever chemistry and thought we could produce aluminum fluoride directly from bauxite, because currently to make aluminum fluoride, you need a form of alumina. So the idea was if we can make aluminum fluoride directly from bauxite, it will both add value to our bauxite and will be a cheaper way of making aluminum fluoride.

What is the market for aluminum fluoride?

It's used in aluminum smelting. You've got the bauxite mine, then the alumina refinery to make the alumina from bauxite, then the aluminum smelter makes aluminum metal from alumina, which needs aluminum fluoride as an additive in the process.

The first idea was: We know the smelters need aluminum fluoride. They don't make it in Australia and need to import all of it. We had a concept to make it directly from bauxite at a lower cost. But once we started the project we realized the economics of making aluminum fluoride are dominated by the fluorine, not by the aluminum. That's when we identified there is a waste from aluminum smelters that contains a lot of fluorine, so let's develop a different technology that allows us to get the fluorine out of that waste and produce aluminum fluoride.

So using the bauxite is now not a priority. Now we're about taking a waste from aluminum smelters that contains a lot of fluorine, using that to make aluminum fluoride and selling it back to the smelters. The aluminum fluoride is essential for maintaining the correct chemical composition in the smelting process.

Senior engineer Xiao Liang assessing laboratory-scale reactor performance at the ALCORE Technology Centre in Berkeley Vale, New South Wales, Australia. Source: ABx Group

Where do Australian aluminum smelters import their aluminum fluoride from?

Australia imports about 25,000 metric tons a year, which is worth about A$40 million to A$50 million a year. Over the last five years, about 80% has come from China, with some from Mexico, the Middle East and Europe. China produces half of the world's aluminum metal and about half of the world's aluminum fluoride, mainly to supply their own smelters. They produce a slight surplus of aluminum fluoride, of which we import some along with other countries like Malaysia and India.

Even if we totally stopped imports from China, it would only change their market by about 5% or maybe 10%. So it has an impact but not a massive one. It's more about Australia being totally dependent on imports, and if China stops exports for any reason like COVID-19 or geopolitical issues, our smelters are at risk. So it's better to have local production here with more secure supply.

I've led process development projects like this for 20 years, and you want to know: If there is a market, is what you're trying to do technically feasible? And what are the risks? And on this one there are no 'showstoppers,' which often happens with new technology where you quietly ignore for a while, but they'll get you in the end.

You received a research and development tax rebate on Aug. 9. Can you explain what you're doing there?

There are a few dimensions. One is the techniques for looking for ionic clay deposits. Drilling is expensive, so anything you can do to develop techniques to find the rare earths, or at least good indications, without just drilling, will give an advantage.

The other is the processing. Currently [ion adsorption clay deposits of] rare earths are only extracted in southern China, and not in the most environmentally friendly manner. So we need to develop how to do it here in a way that's acceptable and appealing to our communities. We can do it now outside China so the commercial risk isn't as high, but if we can do it significantly cheaper with some R&D, then we can improve our competitive position.

A key dimension to this is finding the ideal size of a project. Do you start on the smaller side, generate some cash flow and use that to do more drilling, or start with a bigger one, which you need to decide before embarking on a scoping study.

A lot of clay deposits look superficially similar, but in reality, their metallurgy is very different. As far as we can work out, our Deep Leads resource has the best metallurgy of any ionic clay resource in Australia. It's another reason that gives me optimism. Though we are still a work in progress, it looks promising at this point.

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