Ords Boron 101 Technical Primer

Boron 101
Technical Primer
Ord Minnett has commissioned former Rio Tinto Marketing Executive of Report prepared by:
Industrial Minerals, Michael Le Page to write the accompanying report:
Boron 101 Technical Primer. We’re principally interested in Boron due to its
Michael Le Page
implications on the Rhyolite Ridge lithium/boron project in Nevada, owned
by ASX listed ioneer (INR). Its significant Boron Co-products enables it to
offset 80% of its costs and become the lowest cost lithium producer on the
cost curve, making an understanding of Boron essential to the thesis.
What is Boron
▪ ‘Boron’ is a chemical element with the symbol B. Borates are a commercial
source of Boric Oxide products and considered an industrial mineral. In
2018 the Borates market size was 4.5 million tonnes worth US$2.3bn.
▪ Boron is rare in geological settings, with the largest deposits in Turkey
(70% of world reserves) and the Western US. An oligopoly comprising of
two companies supplies 80% of the world market, Eti (50%) the state
owned Turkish outfit and Rio Tinto in ‘Boron’ California (30%).
▪ In contrast to most commodities, Boron prices are remarkably consistent
averaging $600/t over past 100 years. Boron is big business, it powered
Rio’s Industrial Minerals division, which in 1998, was its largest earnings Dylan Kelly
contributor (37%), ahead of iron ore/copper at 32/28%. Senior Research Analyst
Demand: Tracks GDP 02 8216 6417
dkelly@ords.com.au
▪ Boron is seemingly ubiquitous with over 300 applications in everything from
glass, fibreglass fertilizers, soaps to nuclear reactors. Due to its everyday
use, demand broadly tracks GDP, but the key drives are population growth,
urbanisation and US construction starts.
▪ The largest Borate segment is Boric Acid with 1.1 million tonne worth
US$700m. It is used in a variety of industrial applications, the key being
specialty glass, insulation, ceramics. Demand has grown at has grown
between 4-6% over the past decade, and we expect it to average 4.5%
over 5 years driven by China urbanisation.
Supply & Market Outlook
▪ Boric Acid installed capacity is roughly 1.3mtpa, implying a 81% utilisation
as at 2018. With demand growing at 50ktpa, supply can meet demand by
simply increasing utilisation rates to 100% by 2023. After this, there is no
formal announcement of supply growth from the oligopoly or others.
▪ We forecast the Boron market to shift from balance in 2019-2022 and then
in to deficit by 2023. We expect prices to revert to the marginal cost of
US$700/t, and note we estimate an incentive price of US$750/t.
1 21 October 2019
Boron 101 Ord Minnett Research
Contents
Foreword ............................................................................... 3
Guest Author: Michael Le Page ............................................ 3
Part 1: What is Boron? .......................................................... 4
Boron market ..................................................................... 4
Where is it found? ............................................................. 4
Scarcity.............................................................................. 6
Substitution........................................................................ 6
How is it produced ............................................................. 6
Boron Business ................................................................. 7
Part 2: Demand ..................................................................... 8
Geographic and industry end use ...................................... 9
Boric Acid ........................................................................ 11
Part 3: Supply ..................................................................... 12
Oligopoly ......................................................................... 13
New Projects ................................................................... 14
Supply chain .................................................................... 16
Part 4: Outlook .................................................................... 17
Costs & Margins .............................................................. 17
Incentive price – US$750/t .............................................. 18
Supply & Demand Outlook .............................................. 18
Prices & Forecast ............................................................ 19
Appendix A: Producer Company Summary......................... 23
Appendix B: Greenfields projects ........................................ 29
Appendix C: Boric Acid –End Use....................................... 31
Appendix D: International Trade & HS Codes ..................... 32
Appendix E: Glossary of Terms .......................................... 33
2
Foreword
Boron is seemingly ubiquitous, we use it every day directly every time we touch our
smart phones or indirectly as insulation in our homes and offices. Despite its ubiquity,
we are largely oblivious to its everyday importance.
Today, we’re principally interested in Boron due to its implications on the project
economics of the Rhyolite Ridge project in Nevada, owned by ASX listed ioneer
(INR). The significant boron ‘Co-product’ revenue from this asset has several
profound implications, principally it offsets 80% of its cost base, enabling it to become
the lowest cost producer on the lithium cost curve.
The central concept to understanding RR’s project economics and cost

competitiveness is Boron, specifically the Boric Acid market segment. To assist, Ords
has commissioned former Rio Tinto Marketing Executive of Industrial Minerals,
Michael Le Page to write the accompanying Boron 101 Technical primer.
Dylan Kelly
Ords Mining Analyst
21st October 2019
Guest Author: Michael Le Page

Michael has worked in the resources industry for 40 years and in four countries. His
background is in mine operations, resource project studies, mineral processing,
finance and analysis, strategic planning, sales, marketing and supply chain especially
in coal and a range of industrial minerals including salt, gypsum, talc, borates, lithium
and potash.
From 1999 to 2017, he worked with Rio Tinto in numerous senior executive roles
including executive and non-executive director roles in Australia, USA and
Singapore. These included Chief Commercial Officer, Vice President and General
Manager roles principally in the Energy, Minerals and Iron Ore Product Groups.
Michael consults to a number of companies, including ioneer (INR).
Michael’s qualifications include:
▪ B App Sc - Chemistry and Chemical Technology

▪ Graduate Diploma of Applied Finance and Investment
▪ Master of Business Administration qualifications
▪ Fellow of the Australian Institute of Mining and Metallurgy.
This paper was written in conjunction with Ord Minnett Research.
3
Part 1: What is Boron?

Boron is a chemical element with the symbol B and the atomic number five. Elemental
boron is a metalloid which means its properties are intermediate between those of
metals and solid non-metals or semiconductors. Boron is relatively rare, but it can be
concentrated by the action of water, in which many borates are soluble.
The term “borates” describes a commercial source of boric oxide (B2O3) products
either in the form of:
▪ sodium borate compounds – decahydrate (10 mol), pentahydrate (5 mol), or

anhydrous borax;
▪ colemanite (calcium borate) - washed and/or calcined;
▪ boric acid - hydrous or anhydrous; and
▪ various other boron chemicals manufactured from the ores, concentrates, or
boric acid.
Boron market
According to Maia Research it is estimated that the 2018 borates word market size
be 4.5 million tonnes worth US$2.3bn. It is comparable to other industrial minerals
Zircon and Talc in value terms.
Figure 1: Boron Mined Market Value vs peers (2018)
4.50 US$bn
3.92
4.00
3.50
3.00
3.00 2.87
2.48
2.50 2.30
1.95
2.00
1.62
1.50
1.00
0.50
0.00
Tantalum Lithium Niobium Tungsten Boron Zircon Talc
Source: USGS, Ord Minnett Estimates
Where is it found?
Due to the extraordinary geological habitat required for the formation and more
importantly the preservation of boron deposits and because of water solubility, large
scale commercial examples are rare and confined to four main areas of the world.
These are the desert southwest of the United States, the Andes belt of South America
including Argentina, Chile, Bolivia, and Peru, Turkey and the eastern region of
Russia. The borates market is supplied principally by two major players: Eti (Turkey)
and Rio Tinto (US) which supply 80 percent of the world refined borates. Other
smaller players include Searles Valley Minerals (SVM) from the US, Bor from Russia,
and several from South America and China. Rio Tinto and Orocobre are the only
listed borates suppliers.
Four minerals account for 90% of the world’s commercial production of borates which
are generally divided into sodium and non-sodium varieties. These are:
▪ Tincal - a sodium borate and is referred to as borax;

▪ Kernite - a refined borates feedstock;
▪ Colemanite - a non-sodium borate;
▪ Ulexite – a sodium borate; and
▪ Others- Hydroboracite, Szaibelyite, and Datolite,
4
Two lithium / borate minerals are Jadarite, which was discovered in the Rio Tinto
Jadar project in Serbia and Searlesite, found in ioneer’s project Rhyolite Ridge
prospect in Nevada, USA. These are relatively new sources and have potential as
commercial sources of both borates and lithium.
Figure 2: World Producers of Borates
Source: ioneer Limited
Figure 3: Borate Minerals
Source: Authors own photos
5
Scarcity
Boron is relatively scarce within the earth’s crust with an estimated 10 parts per million
(‘ppm)’ which is similar to Lead (14ppm) and Samarium (7ppm). You are likely to find
Boron present in your backyard in concentrations of 45ppm, which ranks 26 of 50
elements and is similar to copper (39ppm) and lithium(50ppm).
Figure 4: Element abundance in the earth’s crust (Parts per million)
Tantalum 2
Uranium 2.7
Tin 2.3
Beryllium 2.8
Dysprosium 5.2
Samarium 7.05
Boron 10
Lead 14
Gallium 19
Niobium 20
Lithium 20
Cobalt 25
0 5 10 15 20 25 30
Parts per million
Source: Alekseenko (2014), Ord Minnett edits
Substitution
According Graedel (et al 2013) defined Boron as having a ‘good’ substitute
performance with a value of 41 (0 = perfectly substitutable, 100 = no substitutes) but
it depends on the function. In Boron’s primary use of ceramics & glass, some
functions can be substituted by sodium while in surfactants chlorine and enzymes
can be used. However, for ferroboron, enamels and glazes and agriculture there does
not appear to be any substitutes and in many applications borates are preferred.
How is it produced
For the main borate miners and refiners, the run of mine (ROM) ore is initially crushed
and screened. Some producers, like Eti, sell some of the raw mineral or a
concentrated form of the mineral (e.g. ground colemanite) as a low-priced, lower
quality substitute for the refined product. To produce the refined borate products, the
screened ROM minerals are processed by dissolving the minerals in either hot water
or sulphuric acid and crystallizing out the refined products. The anhydrous products
like anhydrous boric acid are produced by calcining the products in a furnace.
6
Boron Business
As far back as 1999, Boron was a key part of Rio Tinto’s Industrial Minerals division,
which at the time contributed 37% of group earnings ahead of iron ore (32%) and
copper (28%). Under Rio Tinto, the Borates business has had a long and prosperous
history with a remarkably consistent earnings stream over the long term. We note:
▪ Profitable for 25 years: it doesn’t appear to have lost money between 1995-
2019 generating an average of US$120m in earnings.
▪ Margins of 27%: over the past 10 years it appears able to consistently shift its
cost base to maintain margins, via improved efficiencies and disposal of
underperforming assets (Argentina Borax sold in 2012).
▪ Through the cycle generated average returns of 23% (ROA) well above its cost
of capital.
▪ We note that the historic price of Borates has remained remarkably consistent,
with USGS price series dating back to 1914 indicting prices have remained
constant at US$800/t.
Figure 5: Rio’s Boron Earnings & Borates Price (1995-2018) Figure 6: Rio Boron Division Earnings vs Borates
300 45%
US$m
EBITDA
FCF 40%
250 US$mn US$/t 1000 250 ROA (RHS)
Rio Boron Earnings (LHS) Borates Price (RHS) Ebitda Margin (RHS 35%
900 200 30%
200
25%
800
150
150 20%
700
100 15%
100
600 10%
50
50 5%
500
0 0%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
- 400
1997
1998
1999
2000
2001
2003
2004
2005
2006
2007
2009
2010
2011
2012
2013
2016
2017
2018
1995
1996
2002
2008
2014
2015
Source: Rio Tinto Annual Report, Ords Archives, USGS, Trade Map
Figure 7: US Long term Borates Prices 1914-2018 (1998 Dollars)

1400
US$/t (1998)
1200
1000
800
600
400
200
0
1914 1924 1934 1944 1954 1964 1974 1984 1994 2004 2014
Source: USGS, Trade Map, Ords Estimates
7
Part 2: Demand
Boron has a wide range of commercially useful functions and is used in vitrifying,
fluxing, inhibiting, biology, bleaching, buffering, peptizing, dispersing, flame-proofing
and neutron absorbing. Borates may be used for more than 300 applications, with 70
percent used as concentrates, refined borates or boric acid in glass, ceramics,
detergents, and fertilizers. Rio Tinto sells over 30 different products in total. Over time
Eti has been expanding its product range to include more speciality higher margin
products and currently produces 13 different products.
Figure 8: Principal Boron Products Summary & Uses (2018)
Product Boric oxide (% ) Average Price End uses
B2O3 US$/t
Sodium decaborate (borax 10 mol) 37% 500 Adhesives, ceramics, enamels, glazes, cleaners, det
Sodium pentaborate (borax 5 mol) 48% 510 Fibreglass insulation and textile fiberglass, borosilicat
Anhydrous borax 61% 850 Borosilicate and other glasses, glazes, enamels, clea
Boric acid 56% 700 Adhesives, batteries, capacitors, glass, textile fibregla
Boric oxide (anhydrous boric acid) 100% 1500 Specialty glasses, ceramics, enamels, and welding/s
Source: Trade Map, Maia Research, Zebo international.
The major market drivers for borates can be divided into several categories
principally:
▪ Economic growth: Boron used in everything from household soap to home

insulation it is highly correlated to GDP. Key variables include population
growth, construction, energy usage.
▪ Urbanization: construction, home insulation, wiring
▪ Agriculture: Fertilizer.
Figure 9: Global Borates Demand by End Use Figure 10: Historic World Boric Acid End Use
El ectronic
Other Gra de , 2% Others ,
Boros ilicate Nucl ear Power
13% Gra de , 4% 11%
Gl a ss
18% Industrial /
chemi cals Pha rma ceutical
11% Gra de , 8%
Ins ulation
17% Agri cul ture Industrial
12% Gra de , 74%
Fri ts /
cera mics Fi ber Glass
16% 13%
Source: Maia Research and industry analysis, ioneer, USGS

Figure 11: Boron Intensity of use by product
End Use Grams of B203 Unit
Insulation (fibreglass) 70,600 new house – USA
7,500 new house – Western Europe
2,000 new apartment – China
Borosilicate glass 380 glass kitchen cookware
6,000 solar thermal water heater
Ceramic Frit ~50 m² wall tile
<20 m² floor tile
Enamel Frit 100 stove, oven, hob etc.
25 set of cookware
Display glass 45 15” laptop
140 40” TV
5 Tablet
<1 Smart Phone
Source: ioneer, Corning Glass, Ord Minnett Estimates
8
Geographic and industry end use

The two main suppliers are the USA and Turkey and the main markets are China,
North America, Europe and Japan. Consequently, the three main product flows from
Turkey are into China, Asia, Europe and the eastern side of the US. The US exports
from the west through Los Angeles to Europe, China and Asia plus transport product
throughout the US by rail and truck.
The geographic use of boric acid is set out in the figure below which the major
geographical areas are China, North America, Europe and to a lesser extent Japan.
Figure 12: Boric Acid Consumption by location
South America
6% Other
6%
Mi ddle East India North Ameri ca

a nd Afri ca 7%
23%
4%
Ja pa n
4%
Europe
20%
Chi na
30%
Source: Maia Research and industry analysis
Glass (23%)
Borosilicate glass is known for its high chemical resistance mainly used for medical
use and high resistance to thermal shock for kitchen containers, lab equipment and
industrial lighting. The major uses include fibreglass and liquid crystal display panels
(LCD used in televisions, computers, mobile phones, computer tablets, smart
watches etc). Fibreglass is divided into insulation fibreglass (IFG) and is used to
insulate buildings, pipes, tanks, etc. and textile fibreglass (TFG) is used for
reinforcement in, for example, fibre-reinforced plastic (FRP) or glass reinforced
polymer (GRP) utilized in construction, electronics, etc. IFG only requires sodium
borate and TFT dominantly uses ground colemanite. Borosilicate glass (BSG) is
used in solar energy tubes, laboratory apparatus, heat glassware (PYREX®)
(Corning ware) (Corelle ware), chemical tubes, and pharmaceutical packaging like
ampules.
Fibreglass (12%)
Borates are both a flux and a network former and it assists the melt and influences
the final product properties. In fibre glass, for example, it reduces melting
temperatures and helps the fiberizing process and adds bending durability.
Generally, borates lower viscosity, control thermal expansion, inhibit devitrification
and increase durability and chemical resistance, and reduces susceptibility to
mechanical or thermal shock.
Borosilicate glass (19%)

Boric Acid may be used in combination with a sodium borate (borax pentahydrate
or anhydrous borax) in order to adjust the sodium to boron ratio in glasses which
require low sodium levels. This is important in borosilicate glass where B2O3 provides
essential fluxing properties at low sodium and high alumina levels. A figure setting
out the end uses for borates and the relative demand is set out below.
Ceramics & Glazes (18%)

Borates are used in ceramic frits and glazes where it acts as both a network former
and a flux for the glossy surfaces of ceramics and enamels. It initiates glass formation
(at low temperatures), ensures ‘thermal fit’ between glaze and body, reduces
9
viscosity and surface tension, increases refractive index, enhances strength,

durability and scratch resistance, and facilitates lead-free formulations. High boron
frits mature rapidly, improve the speed at which smooth, even glaze surfaces
develop, and provide good bases for colouring oxides. Boric Acids are used as the
B2O3 source in the formulation of fast fire frits for tiles because of their requirement
for low sodium levels.
Agriculture (14%)
Boron is a micronutrient and is used in small concentrations as a fertilizer whereas in
high concentrations it controls biological growth as an herbicide, pesticide, fungicide,
algaecide, and wood preservative. The amount of boron fertilizer applied varies
according to plant type, method of application, amount of rain, and the soil’s lime and
organic material contents. Typically, borates are added into Boron deficient soils e.g.
soils in Indonesia and Malaysia for palm oil production. Fertilizers account for 16%
and herbicides 1% of global borate consumption. Boric Acid is only used for spray
application today. The figure below shows some examples of available borate
fertilizer products.
Figure 13: Boron Fertiliser Products
Source: Company Websites
Other Applications
Oil & Gas Exploration/Production: In the energy sector, borates are utilized to
maximize yields and improve performance in oil well drilling muds, well stimulation,
or fracking fluids by influencing a formulation’s viscosity, pH, thermal stability,
lubricity, and/or flow rate. Sodium borohydride is used to generate and store
hydrogen for use as a fuel and in fuel cells and boron steels, boron carbide, and titan
boron alloys are used in atomic reactors for their neutron absorbance. In wind power
blades they are manufactured from fibre-reinforced composite parts and in solar cells
borosilicate glass is used for evacuated tubes.
Soaps/Detergents/Cleaners: In detergents, cleansers, and personal care, borates

are used to carry active oxygen for bleaching, stabilizing enzymes, enhancing stain
removal, providing alkaline buffering, boosting surfactant performance, softening
water, controlling viscosity or rheology, and/or emulsifying waxes or oils.
Metallurgical: In steelmaking boron acts as a flux and helps dissolve impurities like
silica as well as conditioning the resulting slag. Boron is a flux in the purification of
non-ferrous and precious metals like brass, bronze, copper, gold, platinum, silver,
lead, and zinc, as well as in brazing, soldering, welding, and arc welding. Soft
magnetic cores are made from amorphous metal alloys of cobalt, nickel, iron, silicon,
and boron and neodymium-iron-boron permanent magnets are used for mobile
phones, MRIs, wind turbines, etc.
Ferro boron: is a large application with estimated demand of 90,000tpa in China.

Ferroboron (FeB) is a ferroalloy consisting of iron and boron. The metal usually
contains 17.5% to 20% boron and is used to produce specialist steels. Another
benefit of adding ferroboron to an alloy is that it increases the magnetic susceptibility
of the end alloy, which makes it useful for producing neodymium magnets. Boron
is also used in neodymium magnets (also known as NdFeB, NIB or Neo magnet).
The most widely used type of rare-earth magnet, is a permanent magnet made from
an alloy of neodymium, iron and boron. It was developed independently in 1982 by
General Motors and Sumitomo Special Metals and neodymium magnets are the
10
strongest type of permanent magnet commercially available. They have replaced

other types of magnets in many applications in modern products that require strong
permanent magnets, such as motors, cordless tools, hard disk drives and magnetic
fasteners.
Boron carbide is an extremely hard boron–carbon ceramic, and covalent material

used in tank armour, bulletproof vests, engine sabotage powders, as well as
numerous industrial applications. With a Vickers Hardness of >30 GPa, it is one of
the hardest known materials, behind cubic boron nitride and diamond.
Nuclear energy, the boron-10 isotope is essential to the safety and control systems
of nuclear power stations as it is a highly effective absorber of thermal neutrons.
Other applications include:
▪ Dye stabilization;
▪ Electrolytic capacitors;
▪ Sand-casting (magnesium);
▪ Electroplating;
▪ Leather processing and finishing; and
▪ Textile finishing paints.
Boric Acid
Boric acid is supplied to worldwide markets for use in a wide variety of industrial
applications at a 2018 rate of 1.1 million tonnes per annum estimated to be worth
US$700 million. The main end uses are in speciality glass, ceramics, agriculture and
insulation.
The primary drivers for BSG and frits are urbanization, increasing middle class and
aging population. The main driver for insulation is the ongoing recovery in US
housing. Other notable borate end-uses include TFT/LCD and textile fiberglass
(TFG). Estimates show that more than half of global borate commercial consumption
is in various forms of glass − borosilicate (19%), insulation-grade fibreglass (IGFG)
(17%), textile-grade fibreglass (TGFG) (12%), and specialty glass including TFT/LCD
(5%). Boric acid end use is similar with estimates showing that over half of the end
use is in forms of glass with the next biggest end use in ceramics.
Glass is the largest and fastest growing at 5%pa segment over the past four years.
Frits, insulation and agriculture are the other fast-growing end uses. China is the
largest market for Borosilicate glass (BSG) and frits end uses, while North and South
America are the biggest markets for insulation and agriculture, respectively.
According to industry research by Maia Research, the global demand for boric acid
is projected to grow approximately at mid-four percent over the period out to 2024.
China will continue to be the biggest market over the forecast period, growing the
fastest of the four major end use regions at approximately 4.7 percent annually after
growing at 5.5 percent per annum over the past four years. North America is the
second biggest market for borates and is expected to grow at 4.5 percent.
11
Part 3: Supply
Non-sodium refined borates include mostly boric acid (92 percent) and some boric
oxide (calcined boric acid) (eight percent). Because boric acid is such a large
component of the non-sodium refined borates market, the non-sodium market is
mostly defined by boric acid. Boric oxide is the same as boric acid without the water
in the crystals so is used in speciality applications where no water is required.
Boric acid is supplied to worldwide markets for use in a wide variety of industrial
applications. The current total production capacity is 1.3 million tonnes per annum
and the 2018 production was estimated at 1.1 million tonnes. The main suppliers are
Rio Tinto, Eti Maden from Turkey and Bor from Russia. The main end uses are in
speciality glass, ceramics and insulation.
The range of growth is from 4.3 percent to 6.0 percent. Post 2019, global supply of
boric acid is projected to continue to meet demand as suppliers increase production
to meet the markets’ needs. Based on research by Maia Research and other analysis
it indicates that there are currently 1.3 million tonnes of installed capacity compared
to a market demand of 1.1 million tonnes in 2018.
No formal announcements have been made from suppliers about expansions. The
market growth experienced in 2018 equated to 50,000t of additional demand which
would mean that if this growth continued and all suppliers operated at 100% of
installed capacity the supply would not meet demand by 2023.
Figure 14: Boric Acid Project Summary 2018
Reserve Grade (B203) Capacity Utilisation Market Share
Owner Mt % ktpa % (2018) % (2018)
RIO USA 72 25% 400 83% 30%
Eti Turkey 3,063,636 28% 385 80% 28%
Bor Russia 230 10% 150 88% 12%
SVM USA 114 90% 9%
Quiborax Chile 1,500 2% 155 19% 3%
China Step 1+ 2 China 2,400 9% 84 94% 7%
ORE Argentina 17 16% 9 89% 1%
Other 63 185% 11%
Total Supply 1360 81%
Source: Maia Research, Ords Estimates, Company Filings
Growth Projects Resource
Figure 15: Global Boric
ORE - Olacapato Acid Production
Argentina 6.85 15% 16
Eti
ORE - Tincalayu RIO Bor
Argentina Other China Step 1+ 2
17.8 11% 40
1200 1155
INR kt Boric Acid USA 154 1108 5% 173
1055
Jadar Serbia999 135 15% 130
Fort
1000Caddy 943 USA 120 7% 8
Barcanora 890 Mexico 10 11% 50
800
600
400
200
0
2014 2015 2016 2017 2018 2019
Source: Maia Research, Ords Estimates,
12
Oligopoly
The borates and boric acid markets are an oligopoly with two main suppliers, Rio
Tinto (USA) and Eti Maden (Turkey) and a couple of smaller suppliers.
Rio Tinto Borates

100% wholly owned subsidiary of Rio Tinto, mines and processes borates in
California in the United States. It operates other processing plants and shipping
facilities in the United States (Wilmington, California), France, Malaysia, and the
Netherlands. The company operates sales offices in Chicago (USA), São Paulo
(Brazil), Frankfurt (Germany), Delhi (India), Shanghai (China) and Singapore with
product distributed via a network of global warehouses and stock points. Rio Tinto
has a production capacity of 1.15 million tonnes per annum of refined product of
which 0.40 million tonnes is boric acid. The 2018 annual report published current
proven reserves are 11 million tonnes B2O3 and probable reserves of 5.2 million
tonnes B2O3 for a total of 16.2 million tonnes and an estimated mine life of 25 years.
The Rio Tinto 2018 annual report stated the 2018 production was 512,000 tonnes
B2O3. Rio Tinto has a large borates product portfolio of over 30 products. Rio Tinto
has not announced any plans to expand production at Boron.
Eti Mine Works

‘Eti Maden İşletmeleri’ is a Turkish state-owned mining and chemicals company. Eti
is the world’s largest borate supplier both by market share and proven ore reserves
and holds 72 percent of worldwide borate reserves. Like Rio Tinto, Eti has a wide
product portfolio. Eti’s total production capacity is 2.46 million tonnes per annum
(mtpa) which is made up of 700,000 mtpa of colemanite and 1.76 million mtpa of
refined product including 385,000 mtpa of boric acid. Eti’s export volumes continue
to trend upwards, as does their share of supply in the borate market, which is
approximately 46 percent of the total. Eti’s cost advantages is in their lower mining
costs. Eti’s production of boric acid was estimated to be 310,000 mt in 2018.
MCC Russian Bor CJSC (Bor)

is in south-eastern Russia, with only boric acid production and an option to produce
small amounts of boric oxide and calcined calcium borate. The boric acid capacity is
150,000tpa and production was 132,000 mtpa in 2018. Bor’s boric acid is regarded
as the best quality boric acid in terms of impurities and they supply currently ten
percent of the total boric acid demand. However, they have historically struggled with
production due to financial and employee relationship issues. Marubeni, which is a
major Japanese trading company, is reported to be a supporter of Bor and is assisting
with financing to increase production by 100,000 tpa plus improve the supply chain.
However, there has been no announcement.
Searles Valley Minerals (SVM)

is an Indian owned company and is located about 40 miles (64 kms) northeast of
Boron, California. It produces borates as secondary products to soda ash. SVM’s
mineral resource is located within Searles Lake. The production of boric acid was
estimated to be 114,000 mtpa in 2018. It should be noted that any increase in soda
ash production will increase the boric acid production as they are co-products.
Quiborax
is a supplier of borates located in Chile and tends to focus on the South American
and Chinese market. The free trade agreement (FTA) between Chile and China, has
reduced their import tax to zero. In comparison, USA borates will attract a 10.5
percent import duty into China which is made up of 5.5 percent standard import duty
and a five percent additional import duty which is imposed on US exporters into China
post the USA / Chin trade issues. This gives Quiborax a clear advantage, which is
negated by high freight costs from South America to China. Consequently, their
shipments into China have seen some growth specifically to the ferro boron industry.
Production in 2018 was estimated to be 30,000 mtpa.
13
Orocobre
is an Australian industrial chemicals company through its portfolio of lithium, potash
and boron assets in Argentina. Orocobre owns Borax Argentina S.A, a former Rio
Tinto, well-established boron chemical and mineral producer with extensive
operations and a 50-year production history. Borax Argentina has three open pit
mines, concentrators, refining capacity and significant land holdings located in
Tincalayu and Sijes with production plants located at Tincalayu, Sijes and Campo
Quijano. The refinery operations at Campo Quijano are comprised of a boric acid
plant and a glass furnace that produces anhydrous borax. The mine and concentrator
at Sijes produce mineral concentrates for direct sale. The Tincalayu mine and
production plant produces the refined borates borax decahydrate and borax
pentahydrate. Boric Acid annual production is 10,000 tonnes.
Other South America

In addition to the small number of borate producers already operating in South
America, there is considerable exploration and development activity in a handful of
salars in the high Andes area of Chile, Argentina, and Bolivia. This activity is driven
by lithium required to service the demand for lithium-ion batteries. Borate production
from the existing producers has been modest.
China
In China the bulk of the borate resources are in just two main regions. These are
Liaoning and Jilin in the northeast and Qinghai and Tibet in the west. More than 50%
of the national reserves occur as boro-magnesite (ascharite) ores (average 8.4%
B2O3) in Liaoning and Jilin provinces. This area accounts for 70% of China’s natural
borate production of 1,050,000 tonnes and 80% of the refined borates (320,000
tonnes), and 30% of the boric acid (60,000 tonnes).
The current stringent environmental protection restrictions and frequent

environmental protection scrutiny pushed China’s Boric acid producers to the edge
in 2018, with total boric acid production output estimated to be 155kt. Less than 15
Boric acid producers are estimated to remain operating in 2019. These were five in
Shandong, six in Liaoning, and three to four in Qinghai.
In China boric acid is produced by two main methods. One method is to mine borate
ore and treat it with sulphuric acid to produce high purity boric acid (one step method).
The second method is to take imported sodium pentaborate and treat it with ammonia
to produce high purity boric acid (two step). The two-step method produces better
quality product.
New Projects
The main borate projects are set out below. Orecobre is studying two small brownfield
expansions in Argentina, Fort Cady is studying a small stage one underground project
in California, USA and Rio Tinto and ioneer Limited are studying large Lithium-Boric
Acid projects in Serbia and USA respectively.
Figure 16: Boric Acid Development Project Summary
Project Owner Location Type Resource Grade (B203) Reserve Life Capacity
Owner Owner Mt % years ktpa
Olacapato ORE Argentina Brownfield 6.85 15% 20 16
Tincalayu ORE Argentina Brownfield 17.8 11% >20 40
RR INR USA Greenfield 154 5% +30 173
Jadar Rio Serbia Greenfield 135 15% ~50 130
Fort Caddy Fort Caddy (Stage 1) USA Greenfield 120 7% na 82
Magdalena Barcanora Lithium Mexico Greenfield 10 11% 25 50
Source: Rio Tinto annual reports and Ord Minnett analysis
14
Rhyolite Ridge - ioneer - Nevada

Ioneer Limited owns the Rhyolite Ridge lithium-boron deposit. The deposit contains
a resource of 4.1 million tonnes of lithium carbonate equivalent and 11.3 million
tonnes of boric acid equivalent. This has the potential to be increased in order to
support a 3 million tonnes/year mining operation over 20 years producing 20,000 tpa
of lithium carbonate and 173,000 tpa of boric acid. It has the potential to be a strategic,
long-life, low-cost and reliable source of lithium and boric acid. It is currently in the
feasibility stage which is due for completion in September 2019.
Fort Cady -ABM - California.

The Fort Cady Project is in the eastern part of the Mojave Desert in San Bernardino
County, California about 50 km east of the city of Barstow. The project is planning to
use solution mining to a depth of over 450m with four percent hydrochloric acid
solution to produce a synthetic colemanite (47.5 - 48.5% B2O3). The Definitive
Feasibility Study was finished in December 2018 and the company announced a low
capex (US$37 million) starter project by splitting Phase One into Phase One A and
Phase One B. Financing was agreed in August 2019 for the Phase One A 8,000tpa
starter project. Other studies are continuing.
Magdalena – Bacanora - Mexico

Bacanora Minerals Ltd.’s Magdalena Basin Project in Mexico consists of two
concession blocks approximately 180 km north of Hermosillo, Sonora State, and is
about 80 km south of the US border. A reported update in April 2016 states that initial
metallurgical test work has indicated that a colemanite concentrate grading 38% -
42% B2O3 can be produced from an average feed of 10.5% B2O3 from El Cajon
using a combination of scrubbing, de-sliming, and flotation. The eventual target is to
produce up to 50,000 tonnes/year of boric acid.
Jadar – Rio - Serbia

Rio Tinto has the Jadar Project in Serbia. The basin hosts a Li2O and B2O3 mixture
of colemanite and jadarite. The country has two advanced borate projects with Rio
Tinto and Erin Ventures Canada and another early stage project with documented
borate mineralization Pan Global Resources. The project has the potential to
produce two end products i.e. lithium carbonate and boric acid. The Rio Tinto project
is in the prefeasibility study stage and no announcement has been made about when
it will move into the feasibility study stage.
Pobrdje – Erin Ventures - Serbia

Erin Ventures’ Serbian subsidiary was negotiating in 2017 with Balkan Gold a
commercial contract on the Pobrdje Mine located about 250 km south of Belgrade.
This is a resource estimated at 5,600,000 tonnes at an average of 30.8% B2O3 and
an additional inferred resource of 6,200,000 tonnes at 28.8% B2O3.
Pan Global Resources - Spain

Pan Global Resources Inc in Spain is active in copper exploration in Spain and is a
self-described emerging borates and lithium explorer focused on targets in the
Miocene sedimentary basins of the Balkans, particularly in the Valjevo Basin.
15
Supply chain
Boric Acid is transported in a range of ways which impact logistics costs. The main
supply mechanisms are:
• Covered bulk in a train or truck for domestic customers or barge in some

European areas;
• One tonne plastic lined bulker bag in shipping containers for overseas;
• One tonne plastic lined bulker bag or 25 Kg/50 lb bags on pallets shrink
wrapped in rail boxcars or truck for domestic delivery;
• 25 Kg plastic lined bags on a wooden pallet, shrink wrapped in shipping

containers for overseas delivery or truck for domestic delivery; and
• Bulk delivery by bulk vessel e.g. USA to Asia / Europe or Turkey to Europe
/ USA to a port and warehouse / transhipment facilities.
Companies like Rio Tinto and Eti use transhipment hubs to reduce the transport cost.
For example, Rio Tinto has operated a port and transhipment facility for decades in
Rotterdam, Netherlands where it ships product in bulk vessels from the USA.
Sales process
The commercial way product is marketed and sold is through business to business
processes. While promotion includes communication tactics like advertising, public
relations, social media, email, search engine marketing, videos and more, the key
process is business to business (face to face) promotion. This is where salespeople
or agents are in each selected geography e.g. Japan and they physically meet with
customers and potential customers promoting the products and conducting
negotiations.
Senior salespeople are normally located in larger regions e.g. Asia and manage /
lead the sales team and customer service team in the region. In major markets
technical marketing people are required to discuss and promote the products from a
technical perspective e.g. gain a customer’s technical acceptance which normally is
a formal assessment process. Technical marketing people also perform the quality
control process in each region to follow up and resolve any quality issues. As well as
this they must deal with government approval in relation to sustainable development
during the import process of the product e.g. obtain import licenses as required.
The normal process is to not use agents for larger customers but use company
people to deal on a business to business basis. However, where the products are
bought in bulk, broken down and distributed to multiple customers in a region or the
region has small demand an agent or distributor will be used. In addition, an agent
may be needed to provide processes to clear customs in some countries e.g. Japan.
16
Part 4: Outlook
Costs & Margins
Information on the producers’ costs are unavailable as the suppliers like Eti, Rio Tinto,
Bor and SVM do not publish cost data for boric acid production.
However, Maia Research provided data on margins which indicate that Eti is the
lowest cost producer at US$510/mt on a delivered basis i.e. operating cost plus
freight to the customers’ port. Rio Tinto’s cost was estimated at US$530/mt on the
same basis plus SVM and Bor were at a similar level to Rio Tinto. Bor’s average unit
costs may have reduced with the additional production in recent years by an
estimated US$20/mt to the US$530/mt delivered. Based on this information if a new
producer can produce and deliver boric acid at these figures then it will be
competitive. On a quality adjusted basis we see that the marginal cost of production
is around US$700/t.
Boric Acid Cost Curve – 2018 Quality Adjusted CFR Asia
1000
US$/t RR - No Li
900 Boron Unit Cost Sensitivity to Lithium Credit
Lithium Price US$k/t B=0
China2
9.0 8.0 7.0 6.0 8.95 Incentive Price $750-820/t ORE
800
US$/t (5) 90 185 280 0
China 1
700 Eti Quiborax
600 Bor
SVM
Rio
500
400
300
200 RR - w Li
100

0
0 200 400 600 800 1,000 Kt
Source: CEIC – 2019
Sulphuric acid is used to produce boric acid from the mineral ores and is a significant
contributor to the cost of production. Approximately 280 kg of acid is consumed for
each tome of boric acid. Sulphuric acid is largely dependent on local sulphur supply
and demand and the price can go up and down depending on the local price. The
graph below indicates on a US$ basis the price is relatively stable and trending
downwards except for a significant jump around 2008.
Figure 17: Boric Acid and Sulphuric Acid China Domestic Price-
1500 US$/t US$/t 250
Boric Acid (LHS) Sulfuric Acid (RHS)
1400
2012 high of $1400
1300 200
High correlation to
1200 Sulphuric Acid (key input)
1100 150
1000 17yr average $740/t
900 100
800
700 50
600
2002 low $550/t Spot $636/t
500 0
2002 2004 2006 2008 2010 2012 2014 2016 2018
17
Incentive price – US$750/t

We have modelled three prospective Boric Acid projects to calculate what commodity
price would generate a 15% rate of return. We estimate an average price of US$750/t
is required to incentivise new supply. We note that this assumes an initial price
discount of ~10%, which we believe is required to secure initial customers.
Figure 18: Incentive Price Analysis
Project Fort Cady Olacapato Magdalena
Location California Argentina Mexico
Stake % 100% 100% 100%
Owner x ABR ORE BCN
Status Pre Prod PFS PEA
Type Greenfield Brownfield Greenfield
Mining Method Insitu Leach Opencut Opencut

Project Capex US$mn 148 20.8 7.25
Boric Acid Price Avg

IRR 10% US$/t 647 603 683 644
IRR 15% US$/t 754 780 718 751
IRR 20% US$/t 865 841 754 820
Supply & Demand Outlook

A supply and demand table has been set out below showing the supply and demand
estimate. The annual demand growth rate assumed for this forecast period is 4.5
percent. Maia Research used a forecast annual growth rate of 4.6 percent in their
research. Three scenarios are shown below”
Scenario 1: Base Case

Boric Acid - Potential Scenario - no expansions
Year (tonnes '000) 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Current suppliers 1360 1360 1360 1360 1360 1360 1360 1360 1360 1360 1360
Supply @85% utilisation 1156 1156 1156 1156 1156 1156 1156 1156 1156 1156 1156
Demand 890 943 999 1055 1108 1158 1210 1264 1321 1381 1443
Utilisation rate 65% 69% 73% 78% 81% 85% 89% 93% 97% 102% 106%
Surplus / (deficit) at 85% utilisation 266 213 157 101 48 -2 -54 -108 -165 -225 -287
Surplus / (deficit) at 100% utilisation 470 417 361 305 252 202 150 96 39 -21 -83
Price - estimated 2019-24 815 765 691 703 700 700 710 720 740 760 780
Source: Maia Research for basic information
Scenario 2: Base case + Rhyolite Ridge

Boric Acid - Potential Scenario - ioneer in operation
Year (tonnes '000) 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
ioneer Limited 170 170
Total supply 1360 1360 1360 1360 1360 1360 1360 1360 1360 1530 1530
Demand 890 943 999 1055 1108 1158 1210 1264 1321 1381 1443
Surplus / (deficit) at 85% utilisation 266 213 157 101 48 -2 -54 -108 -165 -80 -142
Surplus / (deficit) at 100% utilisation 470 417 361 305 252 202 150 96 39 149 87
Price - estimated 2019-24 815 765 691 703 700 715 700 710 720 700 720
Source: Maia Research for basic information. Ioneer production estimates from ioneer
presentation August 2019
18
Scenario 3 – Rhyolite Ridge + ROW expansion

Boric Acid - Potential Scenario - ioneer plus 100,000t expansion from a current producer
Year (tonnes '000) 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Expansion by current supplier 100 100
ioneer Limited 170 170
Total supply 1360 1360 1360 1360 1360 1360 1360 1360 1360 1630 1630
Demand 890 943 999 1055 1108 1158 1210 1264 1321 1381 1443
Surplus / (deficit) at 85% utilisation 266 213 157 101 48 -2 -54 -108 -165 5 -57
Surplus / (deficit) at 100% utilisation 470 417 361 305 252 202 150 96 39 249 187
Price - estimated 2019-24 815 765 691 703 700 715 700 702 703 701 697
Source: Maia Research for basic information. Ioneer production estimates from ioneer
presentation August 2019
As this is a global business, market supply tightness can start to be felt when demand
gets to approximately 85 percent of installed capacity due to maintenance shutdown
requirements, non-scheduled breakdowns, inefficient distribution of supply and other
inefficiencies. This information indicates in scenario 1 that the market will start to
tighten in 2020 at >85percent utilisation rate and the demand will exceed supply by
2023. This would indicate that if the current suppliers do not expand and growth rates
stay at current levels the market will need additional capacity.
Prices & Forecast

The boric acid selling price is based on negotiations between the buyer and seller
and prices vary according to the quality (B2O3 content), form (granular etc.),
packaging (bags or bulk), speciality and availability. Invariably there are discounts for
large shipments and/or multi-year contracts and the price may be set ex mine, FOB
at the export port, CIF at the receiving port, or delivered to the consumer in bulk rail,
box car rail or truck. Historically, borate pricing has been dominated by the negotiated
arrangements customers make with Rio Tinto and Eti. The figure below shows the
historical prices for borates products sold in the USA.
The historical long-term prices from USGS are set out below. In the 1926 the Boron
deposit in California was discovered. In 1951 the Turkey Emet mine started producing
minerals and in 1964 started producing refined products. In the early 1980’s
increased supply from Turkey reduced prices. Economic recessions occurred in
1970, 1974/5, 1980/81/82 and 1990 and these may have impacted demand and
prices. In the 1980s, Eti increased its influence on supply so that US Borax served
the Americas and Asia and Eti mainly focused on Europe. More recently, Eti has
expanded its influence into various parts of the East coast of North America and Asia.
The modest size of capacity additions in South America and China has little impact
on the supply side.
19
Figure 19: US Long term Borates Prices (1998 dollars)

1400
US$/t (1998)
1200
1000
800
600
400
200
0
1914 1924 1934 1944 1954 1964 1974 1984 1994 2004 2014
Source: US Geological Survey (USGS)
The prices published by Industrial Minerals are shown in the graph below. Industrial
Minerals is now part of the Fast Markets brand. The inputs are based on industry
contacts that may include producers, traders, and/or consumers. Rather than firm
quotes, these prices are an indication of approximate price points. Over the years,
the basis of the published prices reflects the data that is easiest to obtain. Up until the
early 2000s the United States and to a lesser extent Turkey where the main locations
prices were sourced, but more recently South America has been the sole source.
Through the early part of the 2000’s, borate prices were flat and even declining in
some years as producers adjusted production rates to balance demand as it
recovered from the effects of the 2001 recession. Then the US housing market
peaked and collapsed in 2009 and demand was reduced resulting in flattening prices.
Prices subsequently steadied and increased as a result of significant demand in
China and inventories were restocked. Boric acid prices experienced a steep and
rapid climb from $800 during 2012 to 2013 to a peak of around $1,000/tonne FOB
Chile before settling back at around US$700/tonne. A figure showing the historical
and forecast prices is set out below.
Figure 20: Boric Acid Price delivered
950
900 US$/t
850
800
750
700
650
600 Historic Price Scenario 1 (High)
550 Scenario 2 (Mid) Scenario 3 (Low)

500
2007
2009
2011
2013
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2006
2008
2010
2012
2014
Source – USGS, Staticia.com, Industrial Minerals, Maia research, Trade Map (country by
country import statistics)
20
The most recent import price statistics are set out in the following graph. This
information is from Trade Map, a company which source the data from the respective
government statistics. These prices are on a CIF (delivered to port) basis and do not
include and further delivery costs or duties and are the average import prices.
Figure 21: Average Boric Acid Imported Price (US$/t)
850
China Korea Japan
800
750
700
650
600
550
500
Jul-18 Sep-18 Nov-18 Jan-19 Mar-19 May-19
Source: Trade map
The key points from these graphs and the underlying data are:
• China, over the last year has seen prices reduce;
• In Korea and Japan prices currently appear to be stable with an increase in

Japan recently;
• The Turkish prices are less than US and other suppliers;
• The USA (mainly Rio Tinto) appears to have been very disciplined to keep
prices stable but within the last year have reduced prices down in China;
• In all three cases the US suppliers have increased prices recently; and
• Russia has recently entered the Japanese market presumably with

Marubeni’s support with initial low prices but have gained volume and lifted
their prices gradually.
For a comparison, the data below is from the China Petroleum and Chemical Industry
Federation and shows the average Chinese imported Boric Acid prices from January
2002 to April 2019. The current Chinese prices are US$650/mt on average.
Figure 22: China Domestic Boric Acid Price (US$/t)
1500 US$/t
1400 2012 high $1,400
1300
Sulphuric Acid supply
1200 disruption
1100
1000 17yr average $740/t
900
800
700
600
Spot $636/t
2002 low $550/t
500
2002 2004 2006 2008 2010 2012 2014 2016 2018
Source: CEIC
21
Exchange rates and prices
Turkey – Eti Maden

In recent years Turkey has been through a difficult economic period with a
recession, very high interest rates and high inflation. As a result, the exchange rate
has declined. Compared to the US dollar it has devalued from approximately one
Lira buying US$ 0.45 to one Lira buying US$0.17 or over a 60 percent drop.
This means that Eti Maden have been well able to reduce prices relative to their US
competitors and maintain strong margins. This is evident in the China sales prices.
Argentina – Minera Santa Rita and Ocrocobra

Over the past few years Argentina has experienced a significant decline in the peso
to US$ exchange rate (see below). This 90 percent drop is result of the spiralling debt
market and fears over a potential return to the interventionist policies of Fernandez
de Kirchner’s previous government. Annual inflation has more than doubled from
around 25 per cent in 2015 to 54.5 per cent over the past 12 months.
This means that Argentine borate producers have been able to reduce prices relative
to their US competitors and maintain margins. This is also evident in the China sales
prices.
22
Appendix A: Producer Company Summary

The borates market is supplied principally by two major companies with broad product
portfolios: Eti (Turkey) and Rio Tinto (US). Other smaller players include Searles
Valley Minerals (SVM) from the USA, Bor from Russia, and several from South
America and China. This section will list major developments of various competitors
known at this time.
Rio Tinto Borates – US Borax (RT)

Rio Tinto has production capacities as follows:
Product capacity Tonnes Tonnes B2O3 Conversion

factor
Minerals 0 0 0
Refined borates 1,151,000 576,000 0.5
Boric Acid 400,000 224,000 0.56

capacity
US Borax Inc., a 100% wholly owned subsidiary of Rio Tinto Borates, mines and
processes borates in California in the western United States and operates other
processing plants and shipping facilities in the United States (Wilmington, California),
France, Malaysia, and the Netherlands. The company operates sales offices in
Chicago, USA (North and Central America), São Paulo, Brazil (South America),
Frankfurt, Germany (Europe, Africa, and the Middle East), Delhi, India, Shanghai,
China and Singapore (Asia Pacific) with product distributed via a network of global
warehouses and stock points.
The Boron deposit in California's Kern County, some 190 km northeast of Los
Angeles, was discovered in 1913 with underground mining beginning in the 1920s
and with conversion to the modern open pit in occurring in 1957. According to the
2018 annual report, the company has proven reserves of 11 million tonnes B2O3 and
probable reserves of 5.2 million tonnes for a total of 16.2 million tonnes. The mine
life is estimated to be 25 years.
The ores mined are tincal, kernite and ulexite. The run of mine (ROM) ore is mined
at a rate of about 2.5 - 3 million tonnes/year and is fed to the on-site refined sodium
borate and boric acid processing facilities producing approximately 1 million tonnes
of saleable product.
Crushed tincal ore and kernite ores are dissolved and the clarified liquor from the
thickeners is pumped to the crystallizers where it is cooled to create borax crystal
slurries which are dewatered, washed, and dried.
The boric acid is produced by the dissolution of crushed kernite ore in a mixture of
sulphuric acid and another liquid. The solution is then passed through classifiers and
thickeners and filters where boric acid crystals are formed, washed, centrifuged, and
dried prior to shipment.
For the anhydrous products the fusing plants receive feed from the operation and the
material is fed into a furnace that fuses the product at high temperature to drive off
water. The product is milled and screened prior to storage in a silo prior to packaging.
Granubor product is manufactured at Boron and is a pelletized solid product. The

company also produces products in Los Angeles at Wilmington and operates a
specialty production facility in Coudekerque in France producing additional specialty
products.
The company lists the refined borate capacity at about 576,000 tonnes/year B2O3 and
the Rio Tinto annual reports states recent production rates to be ~510kt.
23
The statistics produced by Maia Research are set out in the table below for boric acid
only. There are two sets of data. The top data is in short tons and the bottom set is in
metric tonnes. The boric acid capacity at Boron is 400,000 tonnes per annum but the
operation does not produce at that rate.
Figure 23: Rio Tinto Boric Acid Production & Financial Estimates
Rio Tinto 2014 2015 2016 2017 2018 2019E
Boric Acid Production kt 286 295 300 319 330 337
Total Boric Oxide (B2O3) kt 508 476 503 517 512
Revenue US$m 240 244 245 257 264 265
Realised Price US$/t 839 829 817 807 800 788
Gross Margin US$/t 291 284 274 268 267 259
Gross Margin % 35% 34% 34% 33% 33% 33%
Volume growth % 3% 2% 6% 4% 2%
Source: Maia Research 2019, Rio Tinto annual reports 2018, 2017, 2016, 2015 and 2014
Research and development
Rio Tinto has always had a very strong research and development effort with
research facilities in Boron. Rio Tinto also has a strong presence in technical venues
and with regulatory authorities to protect the ability of the business to market borate
products worldwide.
Eti Mine Works - Turkey

Eti Mine Works (Turkish: Eti Maden İşletmeleri) is a Turkish state-owned mining and
chemicals company. Eti, is the world’s largest borate supplier both by market share
and proven ore reserves and holds ≈72% of worldwide borate reserves. Eti has a
wide product portfolio, comprising of both minerals (Colemanite, Ulexite, Tincal) and
refined (5 mol, 10 mol, boric acid, Disodium Octaborate Tetrahydrate (DOT),
anhydrous borax and boric oxide).
Eti has been over time shifting towards refined products over mineral products and
adding small capacities of specialty products to their portfolio. Eti’s estimated
production capability is set out in the table below.
Production Tonnes B2O3 tonnes Conversion

capacity factor
Mineral 700,000 280.000 0.4
colemanite
Refined product 1,760,000 893,660 0.51
Boric Acid 385,000 204,050 0.54
Total 2,460,000 1,117,3660
Eti’s export volumes continue to trend upwards, as does their share of supply in the
borate market, which is approximately 46 percent of the total. Eti’s cost advantages
lie in their lower mining costs. The table below sets out Eti’s recent estimated total
production, sales value, prices and margin for boric acid.
Figure 24: Rio Tinto Boric Acid Production & Financial Estimates
Etimaden 2014 2015 2016 2017 2018 2019E
Revenue US$m 195 201 203 218 226 232
Gross Margin US$/t 208 204 202 196 193 189
Gross Margin % 31% 30% 30% 30% 29% 29%
Source: Maia Research 2019
24
Figure 25: Colmanite Processing Schematic
Source: Chemical Engineering and Processing 2011
Capacity expansion
The current boric acid capacity is 385,000 tpa and their production in 2018 was
310,000 tpa. Eti made an announcement in 2012 of an expansion of 500,000tpa but
this has been put on hold and no recent boric acid expansion announcements have
been made.
The two main facilities are Bandirma and Emet. Bandirma’s capacity is 95,000mt and
Emet’s capacity is 290,000mt totalling the 385,000mt.
Distribution and infrastructure networks

Based on industry information, Eti has started making changes to its distribution and
infrastructure networks globally. In China, it has established a bonded logistic hub in
Dalian with Boron Online Co. and is increasing distribution network to gain volume.
In Japan and several European countries, it has been reported that Eti is now going
direct to medium and large customers. The changes in the commercial side of the
business indicate that Eti is attempting to exert greater direction and coordination
between different countries and regions and increasing volume.
Eti opened a warehouse in a free trade warehousing zone (FTWZ) in Mumbai, India
in 2012. Because of the lengthy import permit requirements, customers in India have
been experiencing long lead-times. By supplying the product into India from this
FTWZ, Eti can substantially reduce the lead-times and gain a competitive edge. Rio
Tinto also introduced a FTWZ in India in 2014.
In North America, Eti continues to invest in supply chain infrastructure to improve its
position in this key borate market where it has a low market share. This is particularly
in the Eastern regions.
25
MCC Russian Bor CJSC (Bor)

Bor is in south-eastern Russia, with only boric acid production and an option to
produce small amounts of boric oxide and calcined calcium borate. The boric acid
capacity is 150,000tpa. Bor’s boric acid is regarded as the best quality boric acid in
the market in terms of impurity and they supply currently ten percent of the total boric
acid demand. However, based on limited information it appears, they have historically
struggled with production due to a lack of operating capital, debt problems and poor
employee relationships. Recently it was reported that Marubeni, which is a major
Japanese trading company, is supporting Bor with financing. It is rumoured to be
considering an increase in production of 100,000tpa and supply chain improvements.
However, there has been no announcement.
Bor reported a 1.79 billion Rouble ($44 million) loss in 2013. Given the gradual boric
acid price decline of approximately $100/mt in the past years, profitability will continue
to be a serious issue for Bor without this support from Marubeni.
In December 2016, the assets were put up for sale by public offering. Perhaps
Marubeni entered the Bor business through this sale process. The estimated
production in 2019 appears to be close to nameplate capacity.
Figure 26: Russian Bor - Boric Acid Production & Financial Estimates
Russian Bor 2014 2015 2016 2017 2018 2019E
Revenue US$m 77 80 85 89 93 96
Gross Margin US$/t 216 212 211 206 203 201
Gross Margin % 29% 29% 29% 29% 29% 29%
Searles Valley Minerals (SVM)

SVM is an Indian owned company and is located about 40 miles (64 kms) northeast
of Boron, California, USA. It produces borates as secondary products to soda ash.
SVM’s mineral resource is located within Searles Lake and the deposit contains brine
saline and saline bearing mudstone. Resources are extracted via brine pumps and
extraction wells to feed the manufacturing plants. Anhydrous sodium borate is their
flagship product with production of boric acid, 5 mol, 10 mol, and small amounts of
boric oxide as well. It is believed that SVM has low cost and good quality anhydrous
borax products.
SVM appears to be operating at or near sold-out conditions. They export

approximately 40 percent of production with the remainder sold domestically. No
expansion plans have been announced. However increased soda ash production will
increase boric acid production because they are co-products. Their production
information for boric acid is set out below.
Figure 27: SVM - Boric Acid Production & Financial Estimates
SVM 2014 2015 2016 2017 2018 2019E
Revenue US$m 49 54 61 66 81 88
Gross Margin US$/t 279 283 279 270 260 237
Gross Margin % 34% 35% 35% 34% 33% 30%
Volume growth % 11% 14% 10% 22% 11%
26
Quiborax
Quiborax is a supplier of borates located in Chile and tends to focus on the South
American and Chinese market. The free trade agreement (FTA) between Chile and
China, which came into operation few years ago, progressively reduces import tax to
near zero. In comparison, USA borates will attract a 10.5 percent import tax into China
(5.5 percent standard import dust and a five percent extra charge for US suppliers
due to the current US / Chinese trade negotiations. This gives Quiborax a clear
advantage, which is negated by high freight costs from South America to China.
Consequently, their shipments into China have seen some growth targeting ferro
boron customers.
Figure 28: Quiborax- Boric Acid Production & Financial Estimates
Quiborax 2014 2015 2016 2017 2018 2019E
Revenue US$m 13 15 18 21 25 26
Gross Margin US$/t 312 304 292 290 279 269
Gross Margin % 35% 35% 34% 35% 34% 34%
Volume growth % 17% 22% 20% 17% 9%
Other South America

There are range of smaller producers in South America plus there is some exploration
and development activity in a handful of salars in the high Andes area of Chile,
Argentina, and Bolivia. This activity is driven by lithium required to service the
expected boom in demand for lithium-ion batteries used in transportation. These
projects, plus the existing producers like SQM and Rockwood in Chile and FMC in
Argentina have the potential to produce some borates as a by-product.
Borate production from the existing producers has been modest. SQM produces
about 5,000 tonnes/year of borates (claims a capacity of 16,000 tonnes/year) but
mainly is a significant lithium supplier.
In Argentina the government action involving the introduction of a 10% export tax may
impact supply competitiveness given that sales would be for the exports market,
mainly to China. Minera Santa Rita S.R.L. (MSR) in Salta, Argentina, plans a ≈ 6,800
tonnes/year B2O3 expansion of its ulexite operations. Ulexite is used in ceramics and
agriculture.
Orocobre plans to revamp the products being supplied and increase the capacity
utilization rate of the operation in order to reduce unit costs. A study is evaluating a
potential expansion of the Tincalayu refined borates operation from its current
production capacity of 30,000 tonnes/year.
There has been talk of Corporación Minera de Bolivia (COMIBOL) developing a

production unit on the Salar de Uyuni salt flats which is a major reserve of lithium and
may also produce borates. For these South American producers, the focus in the
South American market and the agriculture industry plus the general industry like
ceramics frits, borosilicate glass in this region.
27
China Domestic
The bulk of the borate resources in China are in just two regions. These are Liaoning
and Jilin in the northeast and Qinghai and Tibet in the west. More than 50% of the
national reserves occur as boro-magnesite (ascharite) ores (average 8.4% B2O3) in
Liaoning and Jilin provinces. This area accounts for 70% of China’s natural borate
production 1,050,000 tonnes based on calculating the percentage of the national
capacity, 80% of the refined borates (320,000 tonnes), and 30% of the boric acid
(60,000 tonnes).
Production in the extreme western provinces is based on kurnakovite and ulexite

(grading 3.3% B2O3) which occurs in various dry playas and saline lakes. Qinghai
and Tibet account for 25 percent of the production of natural borates (375,000
tonnes), two percent of the boric acid (250,000 tonnes), and just five percent of
refined borates (20,000 tonnes). In addition, part of this production along with
imported material is processed (two-step process) into refined borates and boric acid
in Shandong and Shanghai on the China coast.
Total Boric acid capacity in China was estimated to be 547kt in 2018 where most
capacity clusters in Shandong, Liaoning, and Qinghai. Plants adopt producing
methods based on local conditions and China’s local ore one-step boric acid
production vs. the import sodium borate two-steps production in a ratio of 40:60. The
current stringent environmental protection restrictions and frequent environmental
protection scrutiny pushed China’s Boric acid producers in 2018, with total boric acid
production output estimated to be 155kt. Less than 15 top Boric acid producers are
estimated to remain operating in 2019. These were five in Shandong, six in Liaoning,
and three to four in Qinghai. China’s boric acid production output is estimated to reach
167kt in 2019 and 172kt in 2020.
Since the B2O3 content of domestic ore is modest compared with Russia, China
accounts for 15 percent of global mineral production but less than 10 percent of the
B2O3 output. Domestic production is less than a quarter of its borate needs and
therefore China depends heavily on imports. Much of the demand is in the coastal
cities of Qingdao, Tianjin, Shanghai, Nanjing, and inland in Chongqing serving glass
and ceramics end uses.
Kazakhstan
Borates mining in Kazakhstan ceased in 1998, to be replaced by the production of
low-grade material from a waste dump which itself closed in 2004. No current
production is reported.
28
Appendix B: Greenfields projects

As borates resources are limited there are few new projects being evaluated and in
recent years no viable new significant capacity has been brought into production. For
this reason, Rhyolite Ridge is a very significant resource.
ioneer, Nevada, USA.

Rhyolite Ridge is a lithium-boron deposit located in southern Nevada. The deposit
contains a resource of 4.1 million tonnes of lithium carbonate equivalent and 11.3
million tonnes of boric acid equivalent which has the potential to be increased in order
to support a 3 million tonnes/year mining operation over 20 years producing 170,000
tpa of boric acid and 20,000 tpa of lithium carbonate. It has the potential to be a
strategic, long-life, low-cost and reliable source of lithium and boric Acid. It is currently
in the feasibility stage which is due for completion in September 2019.
American Pacific Borate & Lithium Ltd.

The Fort Cady Project is in the eastern part of the Mojave Desert in San Bernardino
County, California. The project is located about 200 km northeast of Los Angeles,
close to the town of Newberry Springs, and is about 50 km east of the city of Barstow.
The project is planning to use solution mining to a depth of over 450 m with four
percent hydrochloric acid solution to produce a synthetic colemanite (47.5 - 48.5%
B2O3).
The Definitive Feasibility Study was finished in December 2018 and the company
announced a low capex (US$37 million) starter project by splitting Phase One in to
Phase One A and Phase One B. Phase One A will target the production of 40kstpa
of SOP (K2SO4) and 6kstpa of boric acid (H3BO3). Lithium extraction is not assumed
in the DFS.
Phase One B will increase boric acid production to 90kstpa using learnings from initial
6k stpa operation. The DFS envisages final production of 408,233 tpa of boric acid
and 108,863 tpa of SOP coming on stream in three phases, with Phase 1 split into
two parts. Construction of Phase 1A is expected to commence in 4Q19 after detailed
engineering studies are completed, with first production scheduled for 4Q20. Phases
1B, 2 and 3 are expected to start two, four and six years after Phase 1A. The DFS is
based on ABR reaching full capacity by mid-2026. The total measured, indicated and
inferred resources are 7.8 million B2O3 tons.
It is noted that as at August 2019 the announcements from the company have
advised that engineering work is proceeded, and the company is seeking funding. No
go decision has been made and no announcements have been made regarding
funding being achieved or companies guaranteeing to offtake product.
Figure 29: ABR Fort Cady key metrics
Phase Completion date Capacity BACapex
ktpa US$m
1a Q4 2020 5 37
1b Q4 2022 76 111
2 Q4 2024 163 191
3 Q4 2026 163 187
Total 408 526
Source: ABR
29
Bacanora, Mexico.
Bacanora Minerals Ltd.’s Magdalena Basin Project consists of two concession blocks
covering a total of 15,508 hectares approximately 180 km north of Hermosillo, Sonora
State, and is about 80 km south of the US border. Within this lies the Cajon Borate
Deposit covering approximately 500 ha on the southern part of one of the concession
blocks. The concessions are 100% owned by Bacanora’s Mexican subsidiary. A
reported updated in April 2016 states that initial metallurgical test work has indicated
that a colemanite concentrate grading 38% - 42% B2O3 can be produced from an
average feed of 10.5% B2O3 from El Cajon using a combination of scrubbing, de-
sliming, and flotation.
Ongoing metallurgical test work on higher value boric acid was scheduled to start in
2017 with the eventual target to produce up to 50,000 tonnes/year of boric acid for
domestic use. Mexico has a market for borates and the project benefits from proximity
to established infrastructure, grid supply, road, water and rail.
Vitro / Unimin, Mexico.

In the 1980s, Mexico’s major glass producer Vitro SA attempted to develop a
colemanite deposit near Hermosillo, Sonora, in northwest Mexico. Pilot plant testing
failed to reduce the arsenic content to commercial levels and the project stalled.
Subsequently, the mineral production operations of Vitro were taken over by Unimin
and operated through a subsidiary Grupo Materias Primas in México (GMP). It is
known that GMP is looking to sell the borate project.
Rio Tinto – Jadar Project, Serbia.

The Jadar basin hosts a Li2O and B2O3 through a mixture of colemanite and jadarite.
The country has two borate projects (Rio Tinto and Erin Ventures Canada) and
another early stage project with documented borate mineralization Pan Global
Resources.
Located near the town of Loznicawest of Belgrade, Serbia, RT’s deposit comprises
jadarite plus subordinate colemanite and ulexite/probertite. The deposit will be mined
underground. The project has the potential to produce two products lithium carbonate
and boric acid. The Rio Tinto project is in the prefeasibility study stage and no
announcement has been made of when it will move into the feasibility study stage.
Erin Ventures, Serbia.

In February 2017 Erin Ventures’ Serbian subsidiary Balkan Gold was negotiating a
commercial contract on the Pobrdje Mine located about 250 km south of Belgrade
and just 1.5 km from its Piskanja boron project. This is a resource with colemanite
with some ulexite.
Pan Global Resources, Spain.

Pan Global Resources Inc. is active in copper exploration in Spain and is a self-
described emerging borates and lithium explorer focused on targets in the Miocene
sedimentary basins of the Balkans, particularly in the Valjevo Basin. Its vehicle is
Lithium Li Holdings with Serbian and Bosnian exploration licenses. There has been
little recent news regarding its operations.
China
It is reported that Shandong Linuo, the largest borates user in China, is investigating
the feasibility of building a 30,000 tonnes/year boric acid plant based on brine
deposits in Tibet and Qinghai. This is a long way from the consumers and has poor
access to infrastructure
30
Appendix C: Boric Acid –End Use
USA – Cellulose Fiber insulation producers – use building insulation
USA – Fiberglass insulation – use building insulation main
USA – general distribution – use various
USA – Wood protection – use – wood protection against termites
USA – fertilizer – use micronutrient in agriculture
USA – glass – boron-silica glass – use – glass manufacture, (PYREX®), Corning

ware
USA – speciality chemicals – use companies further refining boric acid including ultra
fine products
Asia – glass – use boron silica glass for tableware, cookware, laboratory glassware,
medical glassware
Asia – TFT glass – use display glass for LCD TV’s, computers etc – Asahi Glass,
Corning, and LG. Samsung Glass plant were bought by Corning.
Asia – thermal glass- use solar hot water heaters (especially in China for low cost
solar heating)
Asia - fertilizer – use micronutrient in agriculture
Asia – general distribution – use various
Asia – Fiberglass insulation – use building insulation
31
Appendix D: International Trade & HS Codes

The global borates trade patterns are dominated by shipments from the United
States, Turkey and Russia to markets world-wide but principally USA, China, Korea,
Japan and Europe. Turkey produces over 50 percent of the world refined borates and
30 percent of the boric acid. The US produces 30 percent of the world refined borates
and boric acid. China has limited borates production and regions like Japan, Korea
and Europe have essentially no borate production so are solely reliant on imports
from the USA, Turkey, Russian and to a lesser extent South America. The demand
is driven by economic growth, urbanisation, energy demand and agriculture
HS Code Description
2528 Natural Borates and Concentrates
2810 Boric Acid
2840 Borates; Peroxoborates (Perborates)
32
Appendix E: Glossary of Terms
ABA Anhydrous Boric Acid. Dehydrated version of Boric Acid
Anhydrous Borax Dehydrated version of 5 mol used for applications such as

specialty glasses and specialty ceramics
ASTM American Society for Testing and Materials
B2O3 Tonnes of borates are often measured in B2O3 tonnes for consistency. In
Boric Acid there is 56% B2O3 and in Sodium Pentaborate (5 mol) there is 48 %.
Borate decahydrate This is referred to as 10 mol and is used for applications

such as soaps & detergents.
Borate pentahydrate 5 mol (marketed by Rio Tinto as Neobor®) used in varied

end-uses including glass and fibreglass, ceramics and cleaning
Boric Acid Boric Acid (H3BO3) is a pure, multifunctional source of boric oxide
(B2O3). It is white, crystalline in composition and can be used as granules or as a
powder.
Borogard/Firebreak®ZB Zinc Borate. A Rio Tinto product used as a wood

preservative and flame retardant.
IBC Intermediate Bulk Carriers - one tonne bulk bag
CFR Bulk freight term (INCO term) meaning cost and freight for the carriage of
goods by sea to a port of destination and provide the buyer with the documents
necessary to obtain the goods from the carrier.
CIF Bulk freight term (INCO term) meaning cost, insurance and freight for the
seller to arrange for the carriage of goods by sea to a port of destination and provide
the buyer with the documents necessary to obtain the goods from the carrier.
CIP Bulk freight term (INCO term) meaning carriage and insurance paid for
delivery of the goods to a carrier or to another person nominated by the seller, at a
place mutually agreed upon by the buyer and seller, and that the seller pays the
freight and insurance charges to transport the goods to the specified destination.
ETI Eti Mine Works General Management – Turkey

FOB Bulk freight term (INCO term) meaning free on board i.e. ex port
GHS Globally Harmonized System of Classification & Labelling of Chemicals

(UN)
Granubor® A Rio Tinto product used in fertiliser applications. It is the 5 mol

product which has been granulated
Industry demand Several streams of demand contribute to overall industry demand:

direct, internal feedstock and external feedstock/secondary.
Industrial Minerals Industrial minerals are defined as a naturally occurring rock or

mineral, exclusive of metal ores, mineral fuels, and gemstones.
Industrial Minerals Company that wrote a magazine, held conferences and

provided consulting for the Industrial minerals industry. Now called Fastmarkets
Internal feedstock demand Refers to demand for primary products used to produce
secondary products internally (e.g., Sodium Penta Borate to Anhydrous Borates).
External feedstock demand Refers to demand for primary products used to make
other products by external parties (e.g., Sodium Penta Borate to Boric Acid).
Jadarite Sodium lithium boron silicate hydroxide, from the Jadar Basin, Serbia.
Lithium Borate mineral from the Rio Tinto Jadar project.
33
LCD A liquid-crystal display (LCD) is a flat-panel display or other electronically

modulated optical device that uses the light-modulating properties of liquid crystals.
LOI Loss on ignition
Marketable supply Estimate of available supply once internal ore and estimated
feedstock requirements for secondary products are removed.
Mineral borates Natural concentrated boron ores such as tincal, colemanite, and
ulexite. Colemanite is used in TFG and ulexite is used in frits and fertilizers.
Optibor® A Rio Tinto boric acid product used in TFT, glass and fibreglass end-uses
PPM Parts per million
PPB Parts per billion
5 mol Refined sodium borate and is often called as Borax Pentahydrate.
10 mol Refined sodium borate and is often called as Borax Decahydrate.
ROM Run of mine
TFG Textile Fiber Glass.
TFT A thin-film transistor (TFT) is a special kind of field-effect transistor. A

common substrate is glass. The primary application of TFTs is in liquid-crystal
displays.
Ton short ton (2,000 pounds)
Tonne metric tonne (2,200 pounds or 1,000 kg)
USGS US geological survey
Notes:
Tonnes of borates are often measured in B2O3 tonnes for consistency. In Boric Acid
there is 56% B2O3 and in Sodium Pentaborate (5 mol) there is 48 percent B2O3.
Author’s comments
Forward Looking Statements: Various statements in this document constitute

statements relating to intentions, future acts and events which are generally classified
as “forward looking statements”. These forward-looking statements are not a
guarantee or a prediction of future performance and involve known and unknown
risks, uncertainties and other important factors (many of which are beyond the
anyone’s control) that could cause those future acts, events and circumstances to
differ materially from what is presented or implicitly portrayed in this presentation. For
example, market prices or market demand that may vary significantly from current
levels. These variations may materially affect the timing or feasibility of
developments. Words such as “anticipates”, “expects”, “intends”, “plans”, “believes”,
“seeks”, “estimates”, “potential” and similar expressions are intended to identify
forward-looking statements. The author cautions readers to not place undue reliance
on these forward-looking statements, which reflect a view only as of the date of this
document. The forward-looking statements made in this document relate only to
events as of the date on which the statements are made. Except as required by
applicable regulations or by law, the author does not undertake any obligation to
publicly update or review any forward-looking statements, whether as a result of new
information or future events. Past performance cannot be relied on as a guide to
future performance. The author will not guarantee, or be liable for, that all assumed
including the price forecast will be achieved.
34
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36

Ords Boron 101 Technical Primer

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Ords Boron 101 Technical Primer

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Boron 101

The central concept to understanding RR’s project economics and cost

Ords Mining Analyst

21st October 2019

Guest Author: Michael Le Page

Michael’s qualifications include:

▪ B App Sc - Chemistry and Chemical Technology

This paper was written in conjunction with Ord Minnett Research.

Part 1: What is Boron?

▪ sodium borate compounds – decahydrate (10 mol), pentahydrate (5 mol), or

Source: USGS, Ord Minnett Estimates

▪ Tincal - a sodium borate and is referred to as borax;

Source: ioneer Limited

Figure 3: Borate Minerals

Source: Authors own photos

Figure 4: Element abundance in the earth’s crust (Parts per million)

Figure 7: US Long term Borates Prices 1914-2018 (1998 Dollars)

Source: USGS, Trade Map, Ords Estimates

▪ Economic growth: Boron used in everything from household soap to home

Source: Maia Research and industry analysis, ioneer, USGS

Geographic and industry end use

Mi ddle East India North Ameri ca

Source: Maia Research and industry analysis

Borosilicate glass (19%)

Ceramics & Glazes (18%)

viscosity and surface tension, increases refractive index, enhances strength,

Source: Company Websites

Soaps/Detergents/Cleaners: In detergents, cleansers, and personal care, borates

Ferro boron: is a large application with estimated demand of 90,000tpa in China.

strongest type of permanent magnet commercially available. They have replaced

Boron carbide is an extremely hard boron–carbon ceramic, and covalent material

Other applications include:

Source: Maia Research, Ords Estimates,

Rio Tinto Borates

Eti Mine Works

MCC Russian Bor CJSC (Bor)

Searles Valley Minerals (SVM)

Other South America

The current stringent environmental protection restrictions and frequent

Rhyolite Ridge - ioneer - Nevada

Fort Cady -ABM - California.

Magdalena – Bacanora - Mexico

Jadar – Rio - Serbia

Pobrdje – Erin Ventures - Serbia

Pan Global Resources - Spain

• Covered bulk in a train or truck for domestic customers or barge in some

• 25 Kg plastic lined bags on a wooden pallet, shrink wrapped in shipping

Incentive price – US$750/t

Mining Method Insitu Leach Opencut Opencut

Boric Acid Price Avg

Supply & Demand Outlook

Scenario 1: Base Case

Scenario 2: Base case + Rhyolite Ridge

Scenario 3 – Rhyolite Ridge + ROW expansion

Prices & Forecast

Figure 19: US Long term Borates Prices (1998 dollars)

Source: US Geological Survey (USGS)

550 Scenario 2 (Mid) Scenario 3 (Low)

Source: Trade map

• China, over the last year has seen prices reduce;

• In Korea and Japan prices currently appear to be stable with an increase in

• The Turkish prices are less than US and other suppliers;

• Russia has recently entered the Japanese market presumably with

Exchange rates and prices

Turkey – Eti Maden

Argentina – Minera Santa Rita and Ocrocobra

Appendix A: Producer Company Summary