The Robledallano smelter in Spain
Australia-listed Elementos has signed a nonbinding term sheet to obtain an option for up to a 50% interest in Iberian Smelting, owner of a tin smelting and refining facility near Robledallano, Spain.
The facility is located about 220 km from Elementos’ Oropesa tin project.
Iberian Smelting's primary shareholder, CRM Synergies (CRM), operates international tin smelting, refining and solder manufacturing facilities in Spain, Brazil, Mexico and North America. CRM also runs a tin ingot and downstream products sales division.
The agreement outlines a two-stage option for Elementos, with a five-year exercise term and a total consideration of €3.2-million.
Elementos will invest €2-million for working capital and capital improvements, including installing an additional vacuum smelter to enhance efficiency and throughput.
The tin smelting facility has environmental permits covering emissions, water use, and waste management, and recently installed a rotary furnace in 2022.
“This transaction will bring significant economic, strategic and political benefits. Establishing a vertically integrated mine-to-metal supply chain in Europe will transition Elementos from a tin concentrate miner to a tin metal producer,” said MD Joe David.
“European buyers currently pay premiums of around $700/t to $750/t above LME prices to buy delivered metal from Asian smelters. These premiums are expected to continue to exceed treatment and refining charges, along with other costs associated with transporting, financing and insuring concentrate consignments to Asian smelters."
David also emphasised the alignment with the European Union's (EU's) Critical Raw Material Act and the Spanish government's goals, highlighting the importance of domestic production of critical minerals.
“With the global tin supply under strain, we aim to provide reliable and responsible tin supply from within the EU. EU and North American buyers will benefit from a lower average carbon footprint compared to global tin concentrate shipped to Asia and then back to EU and North American markets."