IperionX Letter to Shareholders
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Insights
The announcement from IperionX Limited regarding their upcoming commercial titanium production facility in Virginia represents a pivotal moment for the company akin to the 'Bessemer Moment' in steel production history. This facility, leveraging Hydrogen Assisted Metallothermic Reduction (HAMR) and Hydrogen Sintering & Phase Transformation (HSPT) technologies, is poised to significantly disrupt the titanium market by potentially lowering production costs and enhancing sustainability.
The company's strategic positioning in Virginia, alongside the successful test runs and scaling of the HAMR process, suggests a potential for increased market share and profitability. This is particularly relevant as industries such as aerospace, defense and automotive, which are major consumers of titanium, are increasingly prioritizing supply chain resilience and sustainability.
Investors should note the successful capital raises and government grants, which underscore confidence in IperionX's technology and business model. The strategic partnerships with industry leaders and the company's focus on government contracts could serve as a catalyst for growth, especially in the context of the U.S. government's interest in fostering domestic production capabilities for critical minerals.
The financial implications of IperionX's progress are multifaceted. The equity placement led by Fidelity and the subsequent government grants and funding indicate a robust financial footing for the company's expansion. The projected cost of the initial Virginia production scale-up, around US$21.5 million, appears to be adequately funded, which is a positive indicator for the company's short-term liquidity and operational capabilities.
Long-term, the commissioning of this facility and the expansion of production capacity to 1,000+ metric tonnes per annum by 2026 could translate into substantial revenue growth. The company's focus on recycling titanium metal powder further aligns with global trends toward sustainability, which could attract ESG-focused investors and potentially command premium pricing.
However, investors should also be cognizant of the risks associated with the commercialization of new technologies and the execution of large-scale industrial projects. The company's reliance on the successful roll-out of the HAMR and HSPT technologies and the integration of its Titan Critical Minerals Project, may present operational and market risks.
IperionX's approach to titanium production through the HAMR and HSPT processes exemplifies a commitment to sustainability and innovation. The emphasis on a circular economy, showcased by the company's focus on recycled titanium metal powder and the potential for a low-carbon footprint, aligns with global sustainability targets and could provide a competitive advantage.
The company's receipt of UL validation for 100% circularity and the completion of an ISO compliant life cycle assessment further validate its sustainable practices. These achievements not only enhance the company's reputation but also position it favorably for future regulatory changes and consumer preferences that increasingly favor environmentally responsible practices.
From a strategic standpoint, the integration of the Titan Critical Minerals Project into IperionX's supply chain could ensure a steady, ethically-sourced supply of raw materials, reducing dependency on volatile international markets and reinforcing the company's sustainability narrative.
Figure 1: Bessemer steel production in the
Dear IperionX Shareholders & Stakeholders,
As we embark on a new year and reflect on the remarkable accomplishments made over the past 12 months, I am pleased to confirm that the IperionX team have already turned their focus and dedication to delivering another year of significant growth, innovation and success. Before I begin, I would like to provide some historical context for why this year is expected to be a critical inflection point for our company and why we have so much conviction in the exceptional potential for IperionX.
For nearly 3,000 years, steel was a niche product, primarily because it was significantly more expensive than iron. In 1853, the inventor Henry Bessemer began research in alternate steelmaking methods, which ultimately led him to discover a new low-cost process for producing steel in 1856. It took two more years of testing and development for Bessemer to be in a position to commercialize his new process, by opening the Bessemer Steel Works in
Our core titanium refining and processing technologies, Hydrogen Assisted Metallothermic Reduction (HAMR) & Hydrogen Sintering & Phase Transformation (HSPT), were first patented by Dr. Z Zak Fang in 2016 and 2011 respectively. IperionX now aims to successfully reach its own “Bessemer Moment” as we commission our first commercial titanium production facility, using the HAMR process, in
A summary of our most significant achievements in 2023:
Building our Titanium Metal Commercial Facility in
We executed and expanded on our initial plans, announced in September 2022 by
(1) use our forging technologies (HSPT) to produce traditional titanium mill products (plate, bar, wire, etc.) and near net shape titanium products; and
(2) apply additive manufacturing to produce complex 3D printed titanium products.
Together, our 1080 & 1092 Buildings are expected to create an innovative titanium metal manufacturing campus, demonstrate the commercial scalability of our HAMR and HSPT technologies, and showcase how we plan to revolutionize the titanium value chain in a manner reminiscent of Bessemer’s historic achievement.
Breakthrough Large Scale Commercial Test Runs of the HAMR Process
The HAMR process represents a revolutionary shift in titanium refinement and production. While the science is complex, we view its application as relatively straightforward as it uses conventional, off-the-shelf, low-cost furnace technology that we have already de-risked through comprehensive testwork in 2023. At our leading European furnace supplier, the IperionX team completed two successful furnace hot test runs which scaled the batch size by a factor of 10x, from ~40kg to over 400kg, while reducing cycle time by over
Advancing our Industrial Pilot Facility (IPF) in
IperionX assumed ownership of the IPF in early 2022, and since then we have materially upgraded the facilities to increase the nameplate capacity and enhance the performance of the operation to produce high quality titanium metal powder for customer engagement. Simultaneously, our team worked on the design and engineering of the
Customer Engagement with Global Leaders
We engaged with a wide range of potential customers including Ford, Lockheed Martin, Canyon, and GKN Aerospace. Our 3D printing capabilities yielded our first commercially available titanium product, an innovative Panerai x Brabus titanium timepiece. In addition, we engaged with Lockheed Martin, GKN Aerospace and the
Winning Government Contracts & Industry Awards
2023 began with IperionX winning the
Securing Permits for our Titan Critical Minerals Project in
We successfully secured all key permits for our
Investment Capital for Commercialization
In June 2023, we raised
The Year Ahead
This year is set to be a transformative for IperionX as we aim to realize our own “Bessemer Moment”. We are not just aiming to replicate history but to create our own by disrupting the global titanium supply chain with low cost, sustainable and high-performance titanium products.
Our leading technologies, including HAMR and HSPT, have improved and progressed from a decade of advanced development and 2024 will see IperionX commission our large-scale industrial furnace and demonstrate these leading technologies at commercial scale. Our
Our focus in 2024 will be on:
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Launching our Commercial Operations: The commissioning of our large-scale, industrial furnace in
Virginia is an important step to demonstrate our leading technologies at commercial scale. We expect to accomplish this important milestone in the first half of 2024. - Successfully Commence Production at the 1092 Building: This advanced titanium manufacturing facility is expected to be commissioned in the first half of 2024 and will showcase how we can use our innovative titanium powders to manufacture a wide range of low-cost and high-performance titanium products with powder metallurgy, HSPT forging and 3D printing.
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Expanding Customer and Government Partnerships: We will continue to build upon our existing partnerships and forge new ones, showcasing our innovative titanium solutions. We aim to continue our success with working closely with the
U.S Government to deliver a low-cost, sustainable,U.S. - titanium industry. -
Advancing the Titan Project: Our efforts will focus on developing strategic partnerships to advance our Titan Critical Minerals project, reinforcing our commitment to a sustainable and integrated
U.S. titanium supply chain from minerals to metal products.
I would like to thank the IperionX team for their relentless efforts and remarkable achievements in 2023. It is their exceptional teamwork and dedication that will drive our success in 2024. I also want to express our appreciation to all our stakeholders, including our long-term shareholders, our customers, suppliers and government associates. Your unwavering support and trust in IperionX have been instrumental in our performance in 2023 and we are committed to exceeding your expectations in 2024.
I wish everyone a Happy New Year and a very successful 2024.
Sincerely,
Anastasios Arima
CEO and Managing Director
IperionX Limited
Competent Persons Statement
The information in this document that relates to Exploration Results, Mineral Resources, Production Targets, Process Design, Mine Design, Cost Estimates, and Financial Analysis is extracted from IperionX’s ASX Announcement dated June 30, 2022 (“Original ASX Announcement”) which is available to view at IperionX’s website at www.iperionx.com.
The Company confirms that a) it is not aware of any new information or data that materially affects the information included in the Original ASX Announcement; b) all material assumptions and technical parameters underpinning the Production Target, and related forecast financial information derived from the Production Target included in the Original ASX Announcement continue to apply and have not materially changed; and c) the form and context in which the relevant Competent Persons’ findings are presented in this report have not been materially changed from the Original ASX Announcement.
Forward Looking Statements
Information included in this release constitutes forward-looking statements. Often, but not always, forward looking statements can generally be identified by the use of forward-looking words such as “may”, “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “continue”, and “guidance”, or other similar words and may include, without limitation, statements regarding plans, strategies and objectives of management, anticipated production or construction commencement dates and expected costs or production outputs.
Forward looking statements inherently involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance, and achievements to differ materially from any future results, performance, or achievements. Relevant factors may include, but are not limited to, changes in commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and demand for production inputs, the speculative nature of exploration and project development, including the risks of obtaining necessary licenses and permits and diminishing quantities or grades of reserves, the Company’s ability to comply with the relevant contractual terms to access the technologies, commercially scale its closed-loop titanium production processes, or protect its intellectual property rights, political and social risks, changes to the regulatory framework within which the Company operates or may in the future operate, environmental conditions including extreme weather conditions, recruitment and retention of personnel, industrial relations issues and litigation.
Forward looking statements are based on the Company and its management’s good faith assumptions relating to the financial, market, regulatory and other relevant environments that will exist and affect the Company’s business and operations in the future. The Company does not give any assurance that the assumptions on which forward looking statements are based will prove to be correct, or that the Company’s business or operations will not be affected in any material manner by these or other factors not foreseen or foreseeable by the Company or management or beyond the Company’s control.
Although the Company attempts and has attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in forward looking statements, there may be other factors that could cause actual results, performance, achievements, or events not to be as anticipated, estimated or intended, and many events are beyond the reasonable control of the Company. Accordingly, readers are cautioned not to place undue reliance on forward looking statements. Forward looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, in providing this information the Company does not undertake any obligation to publicly update or revise any of the forward-looking statements or to advise of any change in events, conditions or circumstances on which any such statement is based.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240116767247/en/
Anastasios (Taso) Arima, Founder and CEO
Toby Symonds, President
Dominic Allen, Chief Commercial Officer
Investors: investorrelations@iperionx.com
Media: media@iperionx.com
+1 980 237 8900
www.iperionx.com
Source: IperionX Limited
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