Perpetual Resources Ltd (ASX:PEC) has noted a sharp increase in the level of inbound offtake enquiries for silica sand from its Beharra Project in recent months, sheeting this home to increased exposure to the Asian market.
The company has appointed two additional distribution partners, which has expedited discussions and product testing with interested groups.
These new partners have been facilitating end-user testing, which confirms that Beharra silica sand is suitable for Asian glass applications.
Perpetual says that feedback from interested parties has consistently confirmed very strong demand outlook for high-quality silica sand in the Asia region.
Austrade Critical Minerals exposure
Beharra Project was also recently featured in the Austrade Critical Minerals Prospectus 2022, underpinning foreign investment interest in the project.
The comprehensive publication was launched in December 2002 in Sydney by the Minister for Trade and Tourism, Senator Don Farrell, and is designed to assist with attracting foreign investment and offtake interest into Australia's critical minerals sector.
This prospectus includes a range of detailed technical, project, business, and geological data to assist potential investors to make informed approaches regarding investment decisions.
It has already received widespread acknowledgement from several foreign investors, corporate groups and the Australian Government for its potential to assist in the promotion and marketing of Australia’s key mineral resources.
The recent increase in offtake interest has coincided with this exposure of Beharra as a key critical minerals project in Australia.
“Recent months have shown an increased intensity of interest for Beharra silica sand by potential Asian-based offtake and strategic partnering groups,” Perpetual executive chairman Julian Babarczy said.
Strong market demand
“We remain committed to finalising a binding offtake in coming quarters, which we believe will demonstrate the market demand for Beharra’s high-quality end product.
"Interested parties continue to share their expectations of strong market demand for high-quality silica sand, which aligns with our long-held view of a highly supportive industry supply/demand structure for silica sand.
“I also note Beharra’s inclusion in Austrade’s 2022 Australian Critical Minerals Prospectus. This recognition is a testament to the importance of silica sand as a critical mineral in Australia.
"This publication provides Austrade and Perpetual with the ideal platform to promote Perpetual’s Beharra silica sand products to foreign investors and potential silica sand buyers. We are confident that Beharra will generate substantial interest and contribute to the growth of Australia's critical minerals and silica sand export sector.”
Perpetual now has multiple parallel offtake discussions ongoing, with some of these discussions contemplating the provision of equity and debt funding as well as broader strategic collaborations.
These broader discussions remain at a very early stage and are indicative only, with discussions ongoing and likely to take further time to finalise.