Annual Report 2024

ASM is pleased to present its 2024 Annual Report, highlighting the strategic and operational progress the Company made during the past financial year and the path it is on to successfully deliver its mine to metals strategy.

“It is fair to say, the critical minerals sector has been firmly in the spotlight and ASM is well positioned to benefit from and support this national and international market momentum.

With the right assets, technical capability and team, ASM’s mine to metals strategy offers an end-to-end sustainable supply chain, capable of building a leading position as a global producer of rare earths, critical minerals and high-tech metals..”

Ian Gandel, ASM Chairman

Interactive Critical Minerals Prospectus showcases the Dubbo Project

Australian Strategic Materials (ASM or the Company) welcomes the release of a new digital Australian Critical Minerals Prospectus – a key resource in building international partnerships and supporting the development of Australia’s critical minerals sector.

The Dubbo Project profile, as featured in the interactive Australian Critical Minerals Prospectus.

ASM’s cornerstone rare earths and critical minerals Dubbo Project is featured in the prospectus, which “showcases investment-ready projects that have significant potential to address anticipated production shortfalls, build supply chain security, and deliver progress on a net zero future.”

The interactive digital resource was launched by Minister for Trade and Tourism, Senator the Hon Don Farrell, and Minister for Resources, the Hon Madeleine King MP in Perth, Western Australia.

“Australia is ready and willing to meet the growing global demand for critical minerals, and we welcome international investment in key projects across the country,” said Senator Farrell. “Australia has all the critical minerals the world needs and we need investment to get these projects up and running.”

Globally significant resource

Located in Dubbo, NSW the Dubbo Project is a globally significant resource of rare earths, zirconium, niobium and hafnium. With all major approvals and permits in place, the project is construction ready and targeting final investment decision in 2026 and commencing production in 2028.

The Dubbo Project represents a major opportunity for the development of mid-stream processing in Australia – extracting more value onshore from the country’s critical mineral resources. Through its planned refining and separation plant, the Dubbo Project will process minerals through to oxides and mixed chlorides. These materials will be either sold to international customers or sent for metallisation at ASM’s global metals plants, the first of which is operational in Ochang, South Korea.

“The Dubbo Project is one of the most advanced rare earths projects in Australia and we value the exposure provided via the Critical Minerals Prospectus. The prospectus demonstrates the breadth of opportunities in Australia and highlights how these projects can effectively contribute to the development of sustainable, alternative supply chains,” said ASM Managing Director and CEO, Ms Rowena Smith.

“With a 20-year life of mine, advanced onshore processing capability, and established metallisation production in a likeminded jurisdiction, ASM is uniquely capable of adding value across these emerging supply chains. We hope that through tools like the Australian Critical Minerals Prospectus, the Australian Government continues to support and promote those projects that are most materially advanced and have the potential to address the objectives of the 2023-2030 Critical Minerals Strategy in the timeframe required.”

Overseas investment

In 2024, ASM received letters of interest for conditional debt funding of up to US$600 million from the Export-Import Bank of the United States (US EXIM) and up to A$400 million from Export Development Canada (EDC). Funding from these export credit agencies is linked to potential US and Canadian equipment, goods and services, to be supplied in the construction phase of the Dubbo Project.

“Australia’s resources industry has been developed with foreign investment, and we need overseas investment to build our critical minerals industry. This new online Australian Critical Minerals Prospectus will help drive investment into the sector,” said Minister King.

Cross-jurisdiction collaboration is key to alternative critical mineral supply chains

ASM Managing Director, Rowena Smith, says Australia has an essential role to play in developing the international partnerships and projects that will deliver alternative, sustainable rare earths and critical mineral supply chains.

The emerging rare earths and critical minerals sector needs to work in collaboration across like-minded jurisdictions if it is to create alternative supply chains outside of China’s dominance, says Australian Strategic Materials Ltd (ASM or the Company) Managing Director and CEO, Rowena Smith.

Presenting to delegates at the 2024 AusIMM Critical Minerals Conference in Brisbane, Ms Smith highlighted that the significant rare earths and critical minerals endowment Australia has – in addition to being a global leader in the extraction and processing of raw materials – positions the country to play an essential role in the development of this geopolitically sensitive market.

“Since the global supply chain disruptions caused by the COVID pandemic, there has been growing recognition that it is not sustainable for rare earths and other critical mineral supply chains to be dominated by a single jurisdiction,” said Ms Smith.

“Combine this disruption with growing global demand for these materials to support renewable energies, electric vehicle manufacturing, defence, aerospace and electronics, and there is an urgent need to build a more diverse industry, capable of meeting this forecast growth.

“With our world class projects and technical capability, Australia can be at the heart of this market, but it will require continued investment and partnership at both a national and international level,” she said.

ASM is an emerging vertically integrated producer of critical metals, with a mining asset in Dubbo, NSW and state-of-the-art metallisation facility in Ochang, South Korea. The Korean Metals Plant (KMP) opened in 2022 and is producing rare earth metals and alloys for global customers. The Company’s Dubbo Project – a globally significant rare earths and critical minerals project – has all major approvals and permits in place and is construction ready.

ASM is progressing its funding strategy for the Dubbo Project and earlier this year made significant headway with its debt funding component, receiving conditional letters of interest (LoI) from export credit agencies (ECA) in the US and Canada. In March, the Export-Import Bank of the United States (EXIM) indicated support of up to US$600 million (A$923 million1), followed in April by Export Development Canada’s (EDC) indicated support for up to A$400 million.

“We were delighted to announce the LoIs from EXIM and EDC following extensive positive engagement with both countries. The debt funding is linked to the potential US and Canadian equipment, goods and services to be supplied in the construction phase of the Dubbo Project and the key strategic role the Dubbo Project can play in creating an alternative critical minerals supply chain,” said Ms Smith.

“This strong show of support stems from the clear policy alignment between Australia and North American jurisdictions, and ASM’s work to build operational and commercial partnerships in these countries,” she said.

EXIM President and Chair Ms Reta Jo Lewis gave the opening keynote presentation at the AusIMM event and highlighted the important and growing relationship between the US and Australia.

In 2023, Australia and the US committed to enhance bilateral cooperation under a Climate, Critical Minerals and Clean Energy Transformation Compact. Underscoring the central role of critical minerals to the clean energy transformation, the two countries also established the ministerial-level Taskforce on Critical Minerals. Subsequently, the US awarded Australia ‘domestic source’ status under the US Defense Production Act, paving the way for Australian-based businesses to be eligible to receive loans, grants and purchasing contracts direct from the US Government to support priority sectors, such as critical minerals supply chains, defence applications, and advanced capabilities.

Referring to the critical minerals projects that EXIM is looking to support in Australia during her keynote speech, Chair Lewis, said: “We recognise that demand for critical minerals is growing and it is critical that we work together to identify secure sources of these minerals so we can count on them for national security and vital infrastructure applications…But even as the demand for these minerals grows, geopolitical and project risk to bring new mines into operation will make the process difficult, slow and expensive, and that’s one of the things we’re working very closely on at EXIM Bank. So, we want to let you know that we have your back, as we are trying to move and accelerate these projects forward.”

In addition to the US$600 million LoI from EXIM, in April ASM received another LoI for up to US$32 million (A$49 million1) in debt funding to cover Front End Engineering Design (FEED) services at the Dubbo Project. The FEED work is due to be carried out by US-based Bechtel, making the program of work eligible for EXIM’s Engineering Multiplier Program (EMP).

“ASM is grateful to EXIM for its support, and we continue to collaborate with Chair Lewis and the EXIM team to progress this funding opportunity and work through the due diligence process.

“The US represents a key jurisdiction for ASM as we look to build partnerships in support of our strategic objectives. This includes potential new metals and alloys customers for our Korean Metals Plant, sourcing rare earth oxide feedstock while the Dubbo Project is in development, identifying potential OEM offtake opportunities for our critical mineral oxides, and further equity opportunities,” said Ms Smith.

1Exchange rate (A$ : US$) – 0.65

Diggers & Dealers 2024

Australian Strategic Materials (ASM) was delighted to present at this year’s Diggers & Dealers Mining Forum.

MD & CEO Rowena Smith presented the ASM opportunity and provided an update on the highlights delivered since we were in Kalgoorlie 12 months ago.

You can watch a recording of Rowena’s full presentation courtesy of the Diggers & Dealers YouTube channel below and access our presentation, here.

Quarterly Activities Report to 30 June 2024

We are pleased to advise our Quarterly Activities Report to 30 June 2024 has been released.

In line with ASM’s strategic business priorities, this Quarter, the Company:

  • Delivered several successful optimisations of the flowsheet and design of the Dubbo Project. These included demonstrating a simplified flowsheet design for the production of high-purity hafnia and identifying economic benefits in an alternative niobium oxide circuit. The Company commenced testwork on an alternative circuit for rare earth production (RE Options Assessment) which will continue for the remainder of CY2024. These significant achievements highlight the Dubbo Project’s capacity to produce products that meet growing global demand and identify promising opportunities to reduce both capital and operating expenditures;
  • Executed an Option Agreement with Caspin Resources Limited to provide ASM with an option to earn up to 75% of the rare earth element rights in Caspin’s Mount Squires Project through staged earn in rights;
  • Strengthened its balance sheet by completing a capital raising consisting of an institutional placement and rights issue to raise ~A$16.6 million which positions ASM to undertake activities for progression of final stage engineering for the Dubbo Project in 2024; and
  • Received a non-binding and conditional Letter of Interest from Export Development Canada to provide a debt funding package of up to A$400 million for the construction and execution phase of the Dubbo Project.

REE Whitepaper with Mining Journal

The security and sustainability of critical mineral supply chains continues to be at the forefront of national policy development and international partnership ambitions. As these discussions evolve, Australian Strategic Materials (ASM) has teamed up with Mining Journal and MiningNews.Net to produce a whitepaper focused on rare earth elements markets, their challenges and their opportunities. This foundational document provides a grounding in the realities of the REE space to help inform a range of stakeholders.

The REE Revolution: Foreword by Rowena Smith

Rare earth elements (REEs) are playing a leading role in the globally shared ambition to build diverse, resilient and sustainable critical minerals supply chains. With a broad range of end uses – from clean energy technologies and semi-conductors to medical devices and defence applications – the relevance of REEs in supporting a sustainable and secure future cannot be overstated.

As demand for these materials continues to grow, the importance being placed on increasing production and enhancing processing capability is illustrated by the fact REEs appear on the official critical minerals lists of Australia, Canada, the EU, India, Japan, the Republic of Korea, the UK and the US. These strategically developed lists are driving activity within the resources sectors of the relevant jurisdictions and have been the basis for the policies and partnerships developing between those countries with the shared objective of mitigating risk within an existing supply chain dominated by a single jurisdiction.

Australia has an essential role to play in the development of this geopolitically sensitive market.

Rowena Smith, Managing Director & CEO, Australian Strategic Materials

With a significant endowment of REEs and as an established global leader in the extraction and processing of raw materials, Australia has an essential role to play in the development of this geopolitically sensitive market.

Through engagement and agreements, Australia has taken positive steps to enhance cross-jurisdictional opportunities with countries including the US, Canada, the Republic of Korea, Japan, the EU and Vietnam. These enhanced relationships are looking to develop trade, investment and partnership opportunities within the critical minerals sector but there is still more to be done if we are to fully leverage this generational opportunity.

The 2024 Australian Federal Budget placed an emphasis on Australia’s ability to ‘add value’ to its critical minerals endowment – providing incentives to do more processing activity on Australian shores. It is a commendable ambition and one that one that we should continue to strive for when specifically discussing REEs. But it will not come without its challenges. Delivering on this ambition will require investment and support in both project development and workforce capability.

At Australian Strategic Materials (ASM), we are progressing the development of our Dubbo Project in New South Wales. Here we will extract, separate and refine light and heavy REE oxides. Our refining capability has been developed in partnership with Australia’s Nuclear Science and Technology Organisation (ANSTO) over many years and represents sovereign technical knowhow and IP integral to the successful delivery of the project and broader growth of this sector.

I hope this publication – developed in partnership with Mining Journal – provides some insights into the compelling nature of the global REE opportunity and why Australia should be positioning itself at the forefront of the revolution.

Toongi Soil Carbon Project registered

We’re taking an innovative approach to carbon farming.

Since 2021, our subsidiary Toongi Pastoral Company has been working to identify opportunities to capture and store carbon at the Dubbo Project as part of the Government’s Australian Carbon Credit Unit (ACCU) Scheme.

The Scheme encourages businesses to run projects that reduce emissions or store carbon, by using new technology, upgrading equipment, changing business practices, and changing the way vegetation is managed. Measured increases of in-soil carbon content can earn ACCUs, which can potentially be offset against emissions.

Earlier this year, we were pleased to receive confirmation from the Clean Energy Regulator that the Toongi Soil Carbon Project has been registered as an eligible offset project under the Scheme.

As we continue the development of the Dubbo Project, ASM is committed to supporting the drive toward net zero. Through innovative projects such as this, as well as actively managing and minimising greenhouse gas emissions, we aim to continuously improve our carbon footprint and meet our emission reduction targets.

Dubbo Project Community Newsletter

ASM’s latest Dubbo Project Community Newsletter provides a wrap-up of the project progress we’ve made and highlights where the ASM team has continued to build positive partnerships with local stakeholders.

In recent months a number of sustainability initiatives at the Dubbo Project have been progressed or completed, including:

  • The signing of a contract with the NSW Department of Primary Industries to demonstrate how woody biomass crops can potentially be integrated into land management options for ASM’s subsidiary, Toongi Pastoral Company.
  • Completion of our annual vegetation and Pink-Tailed Worm-Lizard survey in partnership with Area Environmental.
  • Confirmation from the Clean Energy Regulator that the Toongi Soil Carbon Project has been registered as an eligible offset project under the Australian Government’s Emissions Reduction Fund.

You can learn more about these and other initiatives in our latest newsletter.

KMP hosts Dubbo Regional Council delegation

We’re strengthening ties between Dubbo and Ochang to create an alternative end-to-end critical minerals supply chain.

ASM’s Korean Metals Plant (KMP) in Ochang, South Korea has hosted a delegation from the Dubbo Regional Council. As part of a self-funded trip to Korea and Japan, the delegation took the opportunity to see how ASM’s world class facility is manufacturing the high-tech metals and alloys needed for the global energy transition.

Our metals and alloys are the critical ingredient for the permanent magnets used in advanced clean technologies such as electric vehicles and wind turbines. Ultimately, the KMP will use the rare earth oxide feedstock processed at our Dubbo Project.

ASM’s Dubbo Project is located 25km south of Dubbo in central-western NSW. A globally significant resource of rare earths and critical minerals, once operational the Dubbo Project will mine, separate and refine a wide range of oxides, before metallising at our own plant(s) or shipping to global customers.

It’s our mine to metals strategy…

Sincere thanks to Dubbo Mayor Mathew Dickerson and the Dubbo Regional Council team for taking the time to learn more about our operations in South Korea.

We’re looking forward to building the ties between the two locations, in support of our alternative critical minerals supply chain.

ASM improves Sustainalytics Risk Rating

ASM takes a comprehensive approach to ESG activities across its business. Watch Managing Director and CEO Rowena Smith discuss some of the major milestones already delivered and our future objectives, with Mining Journal and MiningNews.Net.

Australian Strategic Materials (ASM) is pleased to confirm it has received its second annual public environmental social and governance (ESG) Risk Rating from Morningstar Sustainalytics, improving to a 27.7 Medium risk rating from a 32.6 High rating in 2023.

The global ESG Risk Ratings measure a company’s exposure to industry-specific material environment, social and governance risks and how well a company is managing those risks.

Significant improvement

This latest rating positions ASM in the top 10% of companies globally within the Diversified Metals-Mining Industry Group.

“Our latest rating represents a significant improvement in overall performance and is recognition of the strategic work we have conducted to strengthen our ESG management,” said Ms Agata Carrabs, VP Risk and Corporate Services.

“ASM is committed to ensuring it operates to high ESG standards and recognises the importance of ESG reporting to identify, assess and manage ESG risks across the business,” said Ms Carrabs.

As ASM establishes itself as a vertically integrated producer of critical metals for sustainable energy solutions, advanced technologies and new growth industries, the Company’s approach to sustainability and ESG activities is core to delivering ASM’s unique mine to metals strategy.

ASM