NEW YORK Is Orbite Aluminae Inc. for real?
On the surface, the multipronged storyline of the can-do, clean-technology company sounds too good to be true. Dig a little deeper, and the bold claims and big promises that have become a trademark of the Montreal-based companys top management begin to look less like mad science and marketing bluster and a lot more plausible.
Orbite has got what it describes as a viable, eco-friendly technology to turn mega-mountains of hazardous red mud generated by industrial alumina production using the Bayer process into cold cash by recovering the full commercial value of the materials constituent products and the land its sitting on.
On top of that, the company has a potline full of patents or pending protection on 14 families of intellectual properties covering various aspects of its versatile, proprietary hydrochloric acid-based process. Orbite claims the technology produces alumina and other high-value productsincluding rare earthsusing aluminous clay, bauxite, kaolin, red mud and fly ash at among the lowest costs in the industry.
And its taken tangible steps to prove it. In mid-December, the company announced it had successfully produced its first tonne of high-purity alumina (HPA) as part of the initial commissioning and testing activities at its commercial-scale HPA production plant in Cap-Chat, Quebec (amm.com, Dec. 18).
Then, only days ago in an announcement issued jointly with Paris-based Veolia Environmental Services, Orbite said that the two companies had signed an exclusive worldwide collaborative agreement for the treatment and recycling of red mud (amm.com, Feb. 5).
"We had been approached by a few groups but this one was extremely well positioned," Richard Boudreault, president and chief executive officer of Orbite, told AMM in an interview. "Veolia is a very large firm, they are international, they are extremely well capitalized andif Im not mistakenthey have been approached previously by many in industry and government to treat red mud but didnt have a solution."
Other factors favoring the tie-up range from the relationships Veolia had already established with environmental regulators around the world to its ability "to get things done," Boudreault said.
"They are strong operators. We plan to build 50 or 100 of these plants eventually, so thats key. They can also protect our intellectual property in many different countries, and that is critical to us," he said. "The agreement we signed is not to do some trials somewhere here or there but it is to build and operate the first plant. Naturally, (Veolia) are going to be looking for a situation where strong demand commands a high price for land, because you are recovering land." Other prerequisites include a significant accumulation of red mud, as well as an interest in, and strong regulations requiring, treatment of the hazardous material.
"As incredible as it may seem, China has a regulation on red mud," Boudreault said. "They have a mandate to recover 20 percent of the red mud accumulated there by 2015. So the nexus of interest is Europe and China.
"The site could be a legacy red mud deposit that has been in existence for maybe more than 100 years, especially in Germany and France," he said. "There is a big will on the part of the governments to recover the land. These problems do not go away."
Boudreault noted that worldwide stocks of untreated red mud are pegged at almost 3 billion tonnes and estimates that some 100 million tonnes of red mud join the global stockpile annually. As a rule of thumb, some 2 tonnes of red mud are generated for every 1 tonne of alumina produced, he said.
But Orbites ambitions go way beyond mining the worldwide red mud mound. "Our vision is to change the alumina industry by building up to 10 smelter-grade alumina (SGA) plants serving Quebec, the third-largest aluminum-producing region in the world, building several high-purity alumina plants and licensing our SGA technology internationally," Boudreault said of the road ahead.
And so far, so good, he claims, citing the startup and initial production of high-purity alumina at Cap-Chat. Plans call for non-commercial production of HPA to continue throughout the commissioning of the plant at a rate of less than 1 tonne daily. "The first HPA samples for customers in Europe, America and Asia will be shipped as the material becomes available throughout the first quarter of 2013," Boudreault said.
Orbite expects the Cap-Chat plant to start commercial production in the second quarter, with plans to offer HPA powder and HPA granules ranging from 4N to an eventual 6N (99.9999 percent) purity.
Cap-Chat is slated to hit its full production stride of 5 tonnes of alumina per day by the end of this year. The company also anticipates the production of gallium and scandium once a planned recovery circuit is complete in mid-2013.
Orbite is counting on two key drivers to deliver profits and growth, Boudreault said. One is the uniqueness of its patented technology, which he said "differs significantly from the rest of the HPA industry and is expected to produce higher purities at lower production costs than existing producers."
The other is changing dynamics in the target markets for the material. HPA is used principally for the production of synthetic sapphires, which in turn serve as substrates in the LED (light emitting diode) industry as well as in displays for hand-held devices and televisions. These markets are expected to experience significant growth over the next few years, Boudreault said, with the LED industry getting a healthy boost from regulations in numerous countries for phasing out the manufacture and sale of incandescent light bulbs.
While Orbite does not intend to license its HPA technology, it does plan to award licenses for its SGA know-how internationally in return for a revenue royalty. The companys first SGA plant is said to be in the feasibility study phase, with Phase 1 construction targeted to begin next year and initial production beginning in 2015.
Although the SGA plant site selection process is not complete, Orbite has said it is negotiating with Moscow-based aluminum producer United Co. Rusal and other potential joint-venture partners.
The company has already set the stage for further growth by acquiring exclusive mining rights over a total of nearly 145,000 acres, including the Grande-Vallee property, which contain indicated resources of 1 billion tonnes that could potentially satisfy 50 percent of Quebecs annual alumina imports for more than 50 years, Boudreault said.