Specialist mining services provider Aquirian Limited, via its wholly owned subsidiaries, has entered into a binding agreement to acquire the assets and land comprising the Wubin ammonium nitrate emulsion plant from Hanwha, with the company also setting out plans to offer Hanwha’s patented X-Load™ range of products in Western Australia.
The facility was built and commissioned in 2020 and is production-ready, with licensing to produce 110,000 t/y of ammonium nitrate emulsion. It was put into care and maintenance in 2021 as part of Hanwha’s strategic decision to exit the bulk explosives market in Australia, with Hanwha selling its other emulsion production assets in Queensland and New South Wales to Orica earlier this year.
Aquirian will pay A$9.6 million ($6.04 million) for the facility, which is some way below the replacement cost of A$18 million the company previously obtained.
The facility site comprises 142 ha of freehold land in Wubin, with the company having also purchased an adjoining property of 9 ha in September this year. This additional property provides accommodation options for staff, with airstrip access, and is expected to de-risk the investment in the facility by allowing for future growth in capacity and storage.
The Wubin facility is strategically located on the northern freight corridor, removing exposure to major population centres and providing access to up to 1.25 Mt of potential explosive demand across Western Australia, the company estimates. The facility’s location provides direct access to up to 75% of the potential explosives market across the Midwest and Pilbara, it says.
Aquirian Managing Director, David Kelly, comments: “This unique opportunity evolves Aquirian as a diversified mining service company, adding further value across the drill and blast value chain. Our management team has extensive industry knowledge, including with this facility, and I am excited by this acquisition and the potential synergies and opportunities it offers. Our acquisition of a near new strategically located asset below likely replacement cost is anticipated to enable us to fast-track our growth plans and provide clients with a new range of services and products to achieve sustainable outcomes in their operations.”
Kelly was also previously the Managing Director of Hanwha in Australia.
The transfer or securing of required licences in favour of Western Energetics is anticipated to take 3-5 months and is a condition precedent to completion of the sale transaction. Once the sale transaction is completed, it is expected to take between 8-12 weeks to bring the facility back online and into production, the company says.
The facility can produce a variety of nitrate-based emulsions. These emulsions are a class 5.1 dangerous good used as a precursor raw material that is blended with other materials to produce a variety of bulk explosives, which are used in mining operations across Western Australia.
The site is also set up as a logistics and storage hub for ammonium nitrate with a storage capacity of 1,500 t currently, with the objective to be expanded to circa-10,000 t.
Aquirian’s technology portfolio is focused on optimising blast hole quality to ensure better client outcomes. This acquisition will bring the company’s offerings closer to providing drilling technology alongside optimised energetics, to meet its clients’ changing and challenging mine conditions, it says.
The acquisition of the facility is conditional on Hanwha granting the company an exclusive licence to manufacture and supply Hanwha’s patented X-Load range of products in Western Australia and a non-exclusive licence to use and sell other of Hanwha’s products. X-Load is a low-density waterproof energetics solution for the challenging and wet mining conditions in the Pilbara mining region. This region traditionally uses basic ANFO product which is not waterproofed. X-Load provides an energy profile and density that mimics ANFO while being a waterproof solution, according to Acquirian.