TORONTO, Nov.  25, 2019  (GLOBE NEWSWIRE) -- Hexagon Energy Materials Limited (ASX:HXG) (“Hexagon” or the “Company”) is pleased to announce strong shareholder support for its updated business strategy. Shareholders voted overwhelmingly to support the change of the Company’s name to Hexagon Energy Materials Limited, reflecting Hexagon’s expanded strategy to include downstream rare-earth processing; rare-earths also being a critical component of the high-growth renewable-energy, energy-storage and electric-vehicle sectors.

At the Company’s Annual General Meeting on November 22, 2019, Chairman Charles Whitfield told shareholders, “We believe that the RapidSX™ rare earth element (“REE”) separation technology, developed by Innovation Metals Corp.(“IMC”) that Hexagon has optioned has the potential to transform the rare earths value chain as it fundamentally changes the economics around new REE project development. At the same time, Western businesses and governments are becoming increasingly focused on security of supply and the RapidSX process could unlock resources and supply chains to provide a competitive alternative for industry.”

Hexagon’s Managing Director, Mike Rosenstreich commented, “Picking up on Charles’ remarks at the AGM and given the strong support for Hexagon’s expanded strategy and entry into REE processing, we plan to start funding development of the Commercial Demonstration Plant forthwith.”

“Initial work will comprise finalization of the capital budget and schedule leading to commencement of front-end engineering and design work so that ordering and construction can commence early in Q1 of 2020. To earn our 49% interest in American Innovation Metals Inc.(“AIM”), we need to fund the US$2 million build-out of the Demonstration Plant and global patent applications.

We are very excited by this opportunity and with shareholder endorsement we want to get on with it. We look forward to working with IMC’s principals to commercialize the RapidSX approach to meet the wide interest that we are aware of from both existing REE producers and advanced project sponsors.”

Background: Investment into American Innovation Metals

More than 99% of votes cast at the recent Annual General Meeting of Hexagon Shareholders were for a change in the nature and scale of the Company’s activities through the acquisition of a 49% interest in AIM, a special purpose vehicle to commercialize the RapidSX processing technology, which separates the REEs contained in chemical concentrates produced by mine-site operators, to subsequently produce rare-earth oxides (“REOs”) for use by various downstream manufacturers. The RapidSX technology was developed by private Canadian company IMC, the 51% partner in AIM.

For more information about Hexagon's REE business with IMC, please refer to the Company's October 10, 2019 announcement entitled, “Hexagon Enters Rare Earths Downstream Processing Industry”.

AIM Investment
Hexagon has a binding Investment Agreement to acquire 49% of the RapidSX technology for REE separation through AIM. The key points are:

Investment is US$6.0M, comprising:

US$2.0M to build out a Commercial Demonstration Plant (“CDP”) within 12 months; andUS$4.0M in deferred payments, payable through Hexagon’s share of future AIM cash flows.

Hexagon will contribute commercial and marketing skills, identify/secure feedstocks, generate RapidSX licencing opportunities, and sales/offtakes for REOs produced.

The CDP is planned to be financially self-sustaining following the initial investment for the build-out. Ultimate commercialization could follow-on quickly centred on licensing agreements with interested producers.

REE and Separation Technologies

REOs such as oxides of praseodymium, neodymium, terbium and dysprosium are the precursors used in the production of REE permanent magnets (“REPMs”). REPMs are critical components for more efficient traction motors for electric vehicles, and direct-drive wind turbine generators for renewable power generation, as well as several key defense and high-tech industrial technology applications.

Hexagon considers that REE separation for the production of REOs is the key supply-chain constraint with approximately 85% of REOs produced in China in an opaque and highly controlled market. The dominant separation technology employed for REE separation is solvent extraction (“SX”) which in its conventional form, is highly capital intensive requiring a very large plant footprint to accommodate up to 1,500 individual mixer-settler units to achieve the desired separated REE products.

RapidSX is a form of accelerated SX which IMC has developed and operated successfully at pilot scale for various mixed REE chemical concentrate types, with financial support from the United States Department of Defense. The pilot program demonstrated significant (approximately 70% to 90%) capital cost savings on the equivalent conventional SX separation plant, as well as reduced operating costs. Table 1 below highlights the advantages of RapidSX over conventional SX — the only proven, commercial and established REE separation technology. 

Table 1: Features of RapidSX compared to conventional SX circuits

RapidSXTMConventional Solvent ExtractionCommentPerformance & Efficiency Commercial PurityYesYes Increased Separation Kinetics
 Faster metals separationAgnostic on feedstock type
 Robust process capable of taking LREE-rich, HREE-rich and even blends of mixed REE feedstocksREE Recovery RatesHighHighProcessing TimeRapidSlowTime to EquilibriumDaysSeveral WeeksCAPEX Equipment CostLowHigh Considerably reduced footprintCommercially Available
 All construction materials, equipment and chemistry are readily available with no ‘black-box’ technologySeparation Staging90% ReductionVery HighOPEX Metal Inventory/WIPLowHigh Low Costs