ASX-listed major mining company Orica has signed a deal with sustainable manufacturer Alpha HPA to explore the feasibility of establishing a new manufacturing facility in North America, which would produce high-purity aluminium products for future-facing industries.
Orica will also acquire a 5 per cent equity interest in Alpha HPA as part of the strategic partnership expansion.
The funding from the transaction will be used to boost the final engineering and product marketing for the full-scale HPA First Project in Gladstone, Queensland.
The proposed facility in North America would utilise and replicate the chemical process synergies that have been successfully established between Orica and Alpha HPA in the development of the First project in Gladstone.
As part of the subscription agreement, Orica will subscribe for approximately 45 million ordinary shares at $0.44 per share to raise $19.8 million.
Sanjeev Gandhi, Orica’s managing director and chief executive officer, said Orica’s investment in Alpha HPA reflects his company’s desire to grow exposure in emerging sectors, such as eMobility, all while leveraging its strong global manufacturing asset base and supporting the broader transition to a low-carbon future.
“Building on our successful partnership with Alpha HPA in Australia, we are thrilled to further expand our relationship and explore opportunities for growth and circularity in North America,” Gandhi said.
“The Alpha HPA First project in Queensland has demonstrated how industrial partnerships can optimise resource use, simultaneously creating value and reducing waste.”
Through 2023, Orica and Alpha HPA plan to initially focus on the technical and commercial feasibility of a new manufacturing facility to produce high-purity aluminium products near Orica’s Carseland manufacturing centre in Alberta, Canada.
“Having established a strong working relationship in developing our HPA First Project, the mutual ambition to expand our relationship into North America and establish Orica as a strategic shareholder in our Company is a welcome progression of our relationship,” said Rimas Kairaitis, managing director of Alpha HPA.
“Importantly, we see these initiatives as a strong endorsement of the ongoing development of our business.”
