TIDMSVML
RNS Number : 5381F
Sovereign Metals Limited
22 March 2022
SOVEREIGN METALS LIMITED
NEWS RELEASE | 22 MARCH 2022
Sovereign's Natural Rutile to Significantly Reduce Pigment
Industry Carbon Footprint
-- Industry defining independent Life Cycle Assessment Study shows
the potential for Sovereign's natural rutile to significantly
reduce the carbon footprint of the titanium pigment industry
-- Each tonne of natural rutile produced at Kasiya is expected
to have a Global Warming Potential of only 0.1 tonnes CO(2)
eq., which equates to a 95% to 97% reduction in total greenhouse
gas emissions (20 to 33 times less) compared to production
of titania slag and synthetic rutile respectively - both of
which are alternative titanium feedstocks produced by upgrading
ilmenite via energy and carbon intensive processes
-- Lowest Scope 3 emissions - Study further confirms producing
titanium dioxide pigment in the EU from Sovereign's natural
rutile has the lowest global warming potential versus ilmenite-upgraded
alternative feedstocks
-- Paint produced from Sovereign's natural rutile is estimated
to have up to 35% lower carbon footprint than that produced
from ilmenite-upgraded alternatives
Sovereign Metals Limited (ASX:SVM; AIM:SVML) (Sovereign or the
Company) is pleased to announce the results of an expanded Life
Cycle Assessment Study (LCA or Study) assessing the Global Warming
Potential (GWP) of natural rutile produced at the Company's Kasiya
Rutile Project (Kasiya) in Malawi.
The Study concludes that Sovereign's natural rutile product is
expected to have substantially lower GWP (Scope 1, 2 and 3 scope
emissions) when compared to other titanium feedstock alternatives
produced by upgrading ilmenite (i.e., synthetic rutile and titania
slag). Using natural rutile from Kasiya as titanium feedstock for
the chloride pigment process would significantly reduce Scope 1, 2
and 3 greenhouse gas emissions. Titanium feedstock is a key
component of various industrial and consumer products. Therefore,
utilising natural rutile such as from Kasiya, as direct use
titanium feedstock could hold the solution to developing low-carbon
footprint products including low carbon paints.
Sovereign's Managing Director, Julian Stephens commented: "We
knew from the previous work done by Minviro that natural rutile has
a lower carbon footprint than its upgraded substitutes produced
from ilmenite. The expanded study now highlights the significant
reduction in greenhouse gas emissions the titanium pigment industry
could achieve by utilising natural rutile produced at Kasiya. This
has direct economic benefits to end users in jurisdictions such as
the EU, where industry pays for carbon dioxide emissions via the
EU's Emissions Trading System and the proposed Carbon Border
Adjustment Mechanism."
Sovereign's Chair of the ESG Committee, Nigel Jones commented:
"Since its discovery, the Kasiya rutile project has been designed
to help decarbonise the myriad of uses of titanium pigment in
industrial and consumer products. This LCA is another step towards
providing a solution to an industry targeting material reduction in
its global carbon footprint while wholly encompassing values of
sustainability."
ENQUIRIES
Dr Julian Stephens (Perth) Sam Cordin (Perth) Sapan Ghai (London)
Managing Director +61(8) 9322 6322 +44 207 478 3900
+61(8) 9322 6322
Nominated Adviser on AIM
RFC Ambrian
Bhavesh Patel / Andrew Thomson +44 20 3440 6800
Joint Brokers
Berenberg +44 20 3207 7800
Matthew Armitt
Jennifer Lee
Varun Talwar
Optiva Securities +44 20 3137 1902
Daniel Ingrams
Mariela Jaho
Christian Dennis
LCA SUMMARY
The Company appointed Minviro Ltd (Minviro) to conduct a
cradle-to-gate life cycle assessment on the production of natural
rutile using methods and parameters in the 2021 initial Kasiya
Scoping Study.
This expanded LCA builds on the Company's LCA study completed
last year which demonstrated the substantial environmental benefits
possible by utilising natural rutile (TiO(2) ) versus beneficiated
high-grade titanium feedstocks made from the lower quality mineral
ilmenite (FeTiO(3) ) such as synthetic rutile and titania slag,
with this latest study extending the scope to include the positive
environmental attributes of the Kasiya operation.
In assessing each GWP, Scope 1, 2 and 3 greenhouse gas emissions
were included. The Greenhouse Gas Protocol supplies the world's
most widely used greenhouse gas (GHG) accounting standards and
establishes comprehensive global standardised frameworks to measure
and manage GHG emissions from private and public sector operations,
value chains and mitigation actions. The Protocol identifies three
"scopes" of GHG emissions which were included in this study.
The scopes of emissions for the mining industry can broadly be
defined as:
Scope 1 : Direct GHG emissions from operations (e.g., combustion
of fuels in mining fleet i.e., bulldozers)
Scope 2 : Indirect GHG emissions from consumption of purchased
electricity, heat, or steam (e.g., emissions embodied in grid
power)
Scope 3 : Emissions created by end-users utilising its products
(e.g., a chloride pigment plant using titanium feedstock to produce
pigment, or a blast furnace using iron ore to make steel) and other
indirect emissions that generally are out of control of the mining
industry.
Rio Tinto plc and Rio Tinto Limited combined (Rio Tinto) have
defined their emissions boundaries for their titanium dioxide
business in their "Scope 1, 2 and 3 Emissions Calculation
Methodology 2021" report.
In calculating Scope 1, 2 and 3 emissions, Rio Tinto treat
emissions from mining, mineral processing, smelting and refining
titanium dioxide feedstock as Scope 1 and 2 emissions. Rio Tinto's
Scope 3 emissions estimate incorporates the emissions associated
with the conversion of titanium feedstocks to titanium dioxide
pigment.
In the context of titanium feedstock for the chloride pigment
process, the LCA Study similarly estimates Scope 3 emissions by
accounting for the emissions associated with the production of
titanium dioxide pigment from either direct use natural rutile or
other high grade titanium feedstocks derived from upgrading
ilmenite.
The Kasiya project is designed considering both the Equator
Principles and Scope 1, 2 and 3 emissions under the Green House Gas
protocol so that the design meets high standards for ESG from the
outset. Access to hydro-generated grid power and solar system to be
installed on site will ensure low carbon power supply for the
project. The use of predominantly rail rather than road transport
for products will also reduce the carbon footprint of the Kasiya
project.
BENCHMARKING SOVEREIGN'S NATURAL RUTILE AGAINST ALTERNATIVES
The Study benchmarked the GWP of Sovereign's 96% TiO(2) natural
rutile product versus alternative titanium feedstocks produced from
upgrading ilmenite, namely:
-- Titania slag (85% TiO(2) ) produced from ilmenite via
smelting in electric furnaces in South Africa; and
-- Synthetic rutile (88-95% TiO(2) ) produced from ilmenite via
the Becher Process in Australia.
These alternatives were chosen as comparison points as they are
two of the largest production routes for titanium feedstocks. South
African titania slag operations account for a significant
proportion of global titania slag production, and the majority of
the synthetic rutile is produced via the Becher process.
Titanium Feedstock Production - Scope 1 & 2 Emissions
Natural rutile produced at Kasiya has a fraction of the GWP of
the alternative feedstocks. The GWP for natural rutile concentrate
from Kasiya (0.1 t CO(2) e per tonne) is significantly lower than
producing titania slag in South Africa (2.0 t CO(2) e per tonne)
and producing synthetic rutile via the Becher process in Australia
(3.3 t CO(2) e per tonne).
The results comparing the three production routes can be seen in
the full announcement on the Company's website. The higher result
for synthetic rutile is mainly due to the use of coal and other
reagents for the upgrading of lower grade ilmenite to the final
synthetic rutile feedstock product.
Titanium Dioxide Pigment Production Benchmarking - Scope 3
Emissions
Using Sovereign's natural rutile as feedstock for producing
titanium dioxide pigment via the well-established chloride route
provides a lower GWP for the production of one tonne of titanium
dioxide pigment compared to using either titania slag or synthetic
rutile.
The pigment production was assumed to be located in the European
Union. The transport of the feedstocks from the site of production
to the titanium dioxide pigment production plant is included in the
comparison. For Sovereign's natural rutile, this was Kasiya; the
production of synthetic rutile was assumed at a plant in Australia;
the production of titania slag was assumed at a plant in South
Africa.
Higher scope 3 GWP of the ilmenite derived titanium feedstocks
led to higher results for the use of synthetic rutile or titania
slag in producing pigment. Using Sovereign Metal's natural rutile
instead of the titania slag would give a scope 3 GWP reduction of
2.2 t CO(2) e per tonne of titanium dioxide pigment. Furthermore,
using Sovereign's natural rutile concentrate instead of the
synthetic rutile would give a scope 3 GWP reduction of 3.7 t CO(2)
e per tonne titanium dioxide pigment.
Scope 3 emissions usually account for the highest proportion of
greenhouse gases from the mining industry, with estimates as high
as 95% of total mining sector emissions. The average scope 3
emissions of the five largest diversified miners are 26 times their
scopes 1 and 2 emissions combined (source - company
disclosures).
Paint Production Benchmarking
Minviro evaluated how using the different feedstocks affects the
GWP of paint production. Using Sovereign's natural rutile provides
the lowest GWP, at 3.3 t CO(2) e per tonne of alkyd paint, which
represents up to a 35% reduction in carbon footprint compared to
paint produced from synthetic rutile.
SUMMARY OF HEADLINE GWP REDUCTIONS FROM USING NATURAL RUTILE
Emission Category GWP Potential Emissions
Reduction
--------------------------------------- ------------ -------------------------
Production of a tonne of natural 0.1 t CO(2) 3.2 t CO(2) e
rutile from Kasiya - Global Warming e 97% emissions reduction
Potential
Production of a tonne of titanium 4.0 t CO(2) 3.7 t CO(2) e
pigment using natural rutile from e 48% emissions reduction
Kasiya - Scope 3
Production of a tonne of alkyd 3.3 t CO(2) 1.8 t CO(2) e
paint using titanium pigment produced e 35% emissions reduction
from natural rutile
--------------------------------------- ------------ -------------------------
Forward Looking Statement
This release may include forward-looking statements, which may
be identified by words such as "expects", "anticipates",
"believes", "projects", "plans", and similar expressions. These
forward-looking statements are based on Sovereign's expectations
and beliefs concerning future events. Forward looking statements
are necessarily subject to risks, uncertainties and other factors,
many of which are outside the control of Sovereign, which could
cause actual results to differ materially from such statements.
There can be no assurance that forward-looking statements will
prove to be correct. Sovereign makes no undertaking to subsequently
update or revise the forward-looking statements made in this
release, to reflect the circumstances or events after the date of
that release.
Competent Persons Statement
The information in this announcement that relates to Sovereign's
Scoping Study at Kasiya is extracted from an announcement dated 16
December 2021 which is available to view at Sovereign's website at
www.sovereignmetals.com.au. Sovereign confirms that a) it is not
aware of any new information or data that materially affects the
information included in the 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 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
announcement.
The information in this announcement that relates to Sovereign's
Mineral Resource Estimate is extracted from an announcement dated
16 December 2021 which is available to view at Sovereign's website
at www.sovereignmetals.com.au. Sovereign confirms that a) it is not
aware of any new information or data that materially affects the
information included in the announcement; b) all material
assumptions included in the 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 announcement.
To view this announcement in full, including all illustrations
and figures, please refer to www.sovereignmetals.com.au .
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