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The same can be said for perlite, as US companies import from Greece.
Once you have an understanding of the supply chain of the cement/concrete and construction industry and link with energy industry it’s simple case of dot to dot.
Firstly, California is reliant on energy from coal power stations from Utah and Arizona. There are no coal power stations in California, so construction companies must source Fly Ash elsewhere but ideally from neighbouring states of Nevada, Arizona and Utah. California, which has mostly quit coal to achieve its green energy targets and other states will follow.
Boral acquired a 4.5 million tonne natural pozzolan source in 2018 in central Utah. Why? Because of coal power station closures in 2018 (brought forward from 2020) and with the largest coal power station in Utah schuled to close 2025.
https://informedinfrastructure.com/41725/boral-resources-acquires-natural-pozzolan-source-for-fly-ash-blending/
https://kutv.com/news/local/utah39s-oldest-coal-fired-power-plant-shut-down
https://www.spglobal.com/marketintelligence/en/news-insights/trending/w2taftmxcpiudwnogpalyw2
Then last year the Navajo Power station in Arizona closed and later this year the Cholla Power station in Arizona will also close. So with fly ash sources dwindling there Boral went into partnership with Kirkland Mining to begin production at their natural pozzolan mine in Arizona.
https://eu.azcentral.com/story/money/business/energy/2019/11/18/navajo-generating-station-coal-plant-arizona-closes/2567154001/
https://eu.azcentral.com/story/money/business/energy/2020/01/07/pacificorp-close-generator-cholla-power-plant-northern-arizona/2829342001/
https://eu.azcentral.com/story/money/business/energy/2020/01/07/pacificorp-close-generator-cholla-power-plant-northern-arizona/2829342001/
In Nevada where SRES pozzolan mine is located, the last coal fired plant in the State is due to start closure end of 2021. So where are Boral and other cement/ construction companies going to source their fly from then? Nevada is a key state in supplying fly ash and raw materials to California – it’s closer than Utah and Arizona. Anyone who works in the construction industry knows having local sources is key to keep costs down. You don’t source cement, sand, aggregates from the other end of the country – it’s too expensive and the Co2 footprint is massive.
Boral will be all over Sunrise natural pozzolan mine like flies around s***.
https://www.powermag.com/nv-energy-accelerates-retirement-of-one-of-nevadas-last-coal-units/
I agree. I would rather the money now and a big increase in the Share price.
I know that may not be as large returns as going alone but it takes away the uncertainty.
A significant difference is that Kirkland is "family-owned". They may have decided that an income of circa $2mpa (plus the upfront payment) for no further effort on their part was quite acceptable.
Plus the price of pozzolan is rising at around 10%pa, according to Boral's own figures.
Plus we also have perlite. (Maybe Boral would like to diversify?!)
So there are good reasons why we should do better - if indeed that is the best path forward.
If we go it alone, we'll almost certainly make more money - but money in the future doesn't equate to money in one's pocket today.
Its a nice idea to think they could strike a big deal quickly but if the offer is anything like $4m up front and $4 a tonne then I would rather not.
That feels hugely undervalued.
Tick tick indeed. Fabulous weekend posts
I read the Boral transcript from February and at the time they didn’t expect any further closures of coal power stations to impact them until 2025. However, since COVID the price of coal has dropped out of its arse and has accelerated the coal power station closures. More are now to close in 2020 and into 2021.
https://www.theguardian.com/environment/2020/may/17/coal-industry-will-never-recover-after-coronavirus-pandemic-say-experts
https://pv-magazine-usa.com/2020/09/18/how-does-the-us-retire-236-gw-of-coal-and-1000-gas-peaker-plants/
https://pv-magazine-usa.com/2020/06/23/global-demise-of-coal-fired-generation-driven-by-idle-and-unprofitable-plants/
https://www.sierraclub.org/press-releases/2020/09/bloomberg-philanthropies-and-sierra-clubs-beyond-coal-campaign-reaches?_ga=2.84168026.252338883.1600658400-1452579694.1600658400
Boral will be all over Sunrises pozzolan deposit like a rash. So JC can rightly turn down $4-5 per tonne offer if Boral develop production. Boral will soon have to offer a lot more. COVID will have actually done Sunrise a favour here.
So if Boral can’t go into partnership with Sunrise then they’ll simply try and buy the mine outright. Only a matter of time.
The Kirkland/Boral deal wasn't that great though, I would hope we get better.
What was it, $4 a tonne or something?
@freshwest : If you look at the 4th of these photos from the 2019 NPA Symposium, you'll see PC talking to someone from Kirkland. Wonder what they're discussing ;-)
https://pozzolan.org/gallery/symposium2019-gallery.html
Well from what I can read it’s as good as a done deal.
Even though Boral have gone into partnership with Kirkland, the Kirkland operation is in Arizona and ours in Nevada where Boral closed their Najoro fly ash facility. Boral still need to start making up the continuing short fall in fly ash as they mentioned in their annual report.
Fixed costs supplyIng the California market with natural pozz through Kirkland will be higher as it’s further away, so our mine in Nevada will be the better replacement in the long term.
It’s no wonder we haven’t seen much mentioned in the RNS about actual production but more about sampling. Get the samples approved and let Boral take care of production. Simples.
Hi freshwest, yes, we had a bit of discussion here about the Boral-Kirkland deal back in Feb/March.
There's some interesting stuff in this conference call transcript, including some hints as to the terms of the deal :
https://finance.yahoo.com/news/edited-transcript-bld-ax-earnings-084524587.html
(Click the "Story continues" button.)
Background - Boral Limited is a multinational company manufacturing and supplying building and construction materials.[1][2] Founded in Australia, it also has extensive operations in the United States and Asia With revenue for total operations of A$5.86 billion (2019), Boral has about 17,000 employees working across 17 countries at 672 operating sites and 154 distribution sites.
IT READS THIS IN THEIR ANNUAL 2019 REPORT ON PAGE 18 - https://www.boral.com/sites/corporate/files/media/field_document/ID-18056-BLD-Boral-FY19-Annual-Report-FINAL.pdf
By the end of FY2021, we expect to be supplying fly ash at a run rate of at least 8.6 million tons per annum, with volume growth coming from a range of initiatives including opportunistic imports, new contract volumes, fixed and mobile storage of off-season production, landfill reclamation and MINING NATURAL POZZOLAN TO SUPPLEMENT FLY ASH PRODUCTION.
In FY2020, however, the well-flagged (previously disclosed) closure of the Navajo utility in NEVADA will have an adverse volume impact of approximately 400,000 tons per annum from December 2019. Despite this, we expect our Fly Ash growth strategy to result in some volume uplift in FY2020.
AND WHERE IS OUR MINE LOCATED? NEVADA. CLOSER THAN KIRKLAND MINING WHO THEY HAVE JUST ANNOUNCED A PARTNERSHIP WITH.
HELLLLLLLLLLOOOOOOO!!!!!!!!