Innovation Metals Corp. Receives Phase-One Funding for the Commercialization of RapidSX™ Rare-Earth Elements Separation Technology

TORONTO, Dec. 20, 2019 (GLOBE NEWSWIRE) -- Innovation Metals Corp. (“IMC”) is pleased to announce that it has received funding support for the Phase-One commercialization of RapidSX™ rare-earth element (“REE”) separation technology for REE concentrates from Hexagon Energy Materials Limited (“Hexagon”).

Per IMC’s October 10, 2019 announcement (“Innovation Metals Corp. and Hexagon Energy Materials Limited Form Joint Venture for the Commercialization of RapidSX™ Technology for Rare-Earth Separation”), IMC executed a binding Investment Agreement whereby Hexagon has secured an option to acquire a 49% interest in IMC’s RapidSX technology for the separation of REEs, using an advanced, proprietary and low-cost approach. IMC developed and piloted the RapidSX separation technology with the assistance of US$1.8 million in funding from the U.S. Department of Defense, resulting in the production of commercial-grade separated REE oxides (“REOs”) at the pilot scale.

IMC and Hexagon have agreed to form American Innovation Metals (“AIM”) — an incorporated joint venture — with IMC contributing the RapidSX technology IP and expertise for REE separation. Hexagon contributes commercial and marketing skills and has agreed to invest US$2 million into the construction of the RapidSX CDP and to pay US$4 million to IMC as deferred consideration, payable from Hexagon’s share of future AIM cash flows.

The RapidSX technology combines the time-proven chemistry of solvent extraction (“SX”) with a new column-based platform, which significantly reduces time to completion and plant footprint, as well as lowering capital and operating costs. This would potentially mitigate current concerns about the extreme concentration of the REE supply chain in China, with greater participation by Western producers and manufacturers. The RapidSX technology has also been successfully applied to the separation and purification of other metals in solution, such as Ni, Co and Fe in leach solutions produced from Ni laterite ores, as well as Li from Li brines.

The Phase-One commercialization of the RapidSX Commercial Demonstration Plant (“CDP”) consists of the following development and commercialization initiatives:

• RapidSX Front-End Engineering Design (“FEED”) Study for the CDP to provide an independent overview of the capital budget and schedule prepared by IMC, as well as some early extrapolations on capital costs for a full-scale commercial plant based on specific mixed REE chemical concentrate feedstock types.
  
  
• Securing RapidSX Intellectual Property by finalizing provisional patent applications on the RapidSX technology and related flow sheets, initially in the United States.
  
  
• The incorporation of AIM in the United States. AIM will serve as the incorporated joint venture vehicle for Hexagon and IMC to commercialize RapidSX.

The CDP will have a planned production capacity of 60,000 to 80,000 kg of REOs per year, with construction and commissioning planned for completion in Q4 2020.

Dr. Gareth Hatch, Chairman and CEO of IMC commented, “We are excited to initiate Phase-One development work to advance the RapidSX CDP in North America. The lack of downstream REE separation capacity outside of China is a critical defense and economic-security issue facing the US and its allies. IMC is confident that the RapidSX CDP will further validate AIM’s ability to provide a low-cost, secure commercial separation technology for Western REE industry participants to produce the full range of commercial-grade light and heavy REOs.”

Hexagon’s Phase-One funding contribution will be applied towards the company’s US$2 million option obligation and will enable IMC — through AIM — to advance the requisite development work to ensure the RapidSX CDP timelines are achieved on time and on budget; and, concurrently, to protect the IP of this important and potentially disruptive REE technology. The CDP will be used to conduct staged scoping- to feasibility-level studies on the performance, capital and operating costs of a full-scale, RapidSX-based REE separation plant.

Initial commercialization by AIM will focus on licencing of the RapidSX technology to mixed REE chemical-concentrate producers for fixed and revenue-based fee structures. Ahead of these licensing agreements, clients will have the opportunity to utilize the CDP to test the separation of their mixed REE chemical concentrates, while covering the plant operating costs.

RapidSX COMMERCIALIZATION STRATEGY
Based on IMC’s pilot-scale work, RapidSX has demonstrated robust economics, the ability to effectively separate LREE and HREEs, significantly reduced footprint/staging, and the ability to build out and commission quickly. However, the most compelling aspect of the technology is the fact that RapidSX is not a ‘new’ technology (with uncertain technological, scalability and economic uncertainties typically associated with new technologies), but rather a radical improvement on the well-established and understood SX separation technology, SX is a well-established, time-proven separation technology for separating REE concentrates into commercial-grade REE products. All commercial separation of REEs today relies on conventional SX.

RapidSX COMPETITIVE ADVANTAGES

Table 1: Summary of RapidSX vs. Conventional Solvent Extraction for REE Separation.

• Low CAPEX: Due to the considerably reduced number of separation stages per SX circuit and resultant smaller physical plant footprint, compared to conventional SX approaches. Based on the IMC pilot-scale test work and review of various ‘typical’ light REE (“LREE”) projects, IMC estimates that there is a 60-70% saving in terms of start-up capital per kg of annual separation capacity, contingent on the specific feedstock utilized and resulting REE products desired.
  
  
• Rapid Equilibrium: As a result of the significantly increased separation kinetics of the RapidSX proprietary technology, the time to equilibrium/steady state is dramatically accelerated — from weeks, as is typical in the case with conventional SX, to hours/days with RapidSX.
  
  
• Low OPEX: Due to significantly reduced separation times, reduced reagent and power consumption, reduced manpower requirements, and reduced in-process metal inventories. The piloting work undertaken by IMC also indicated meaningful cost savings of between 15-20% compared to utilization of conventional SX, depending on the feedstock and resulting REE products. Estimated separation costs of less than US$2/kg for light REOs and less than US$12/kg for heavy REOs, depending on the feedstock and resulting REE products, are competitive with current estimated Chinese separation costs.
  
  
• Agnostic: RapidSX is capable of separating LREE-rich, heavy-REE (“HREE”) rich and even blends of mixed REE feedstocks.
  
  
• Commercially Available: all construction materials for the RapidSX technology - all associated equipment and chemistry — are readily commercially available.
  
  
• Scalable and Modular: the RapidSX technology’s process lines are modular and scalable, providing licensees to scale commercial production capacity.

SUBSTANTIAL REE MARKET OPPORTUNITY

Adamas Intelligence estimates that the 2018 primary REO market size was 184 kt/year with a market value of US$3.2B; forecasted to grow 60% (to 293 kt/year) in terms of market size, and more than 85% (to US$6.3B) in market value by 2025. Certain sectors are projected to have significantly higher growth rates, with the use of REEs for EV traction motors projected to grow by 350% between 2018 and 2025, demonstrating the considerable potential scale of the AIM business.

About Innovation Metals Corp.
Innovation Metals Corp. (“IMC”) is a private Canada-based company and developer of the proprietary RapidSX^™ process, for the low-cost separation and purification of rare-earth elements (“REEs”), Ni, Co, Li and other technology metals, via an accelerated form of solvent extraction. IMC is commercializing this approach for a number of metals, to help enable mining and metal-recycling companies to compete in today’s global marketplace.

Forward-Looking Statements
This news release contains projections and statements that may constitute “forward-looking statements” within the meaning of applicable Canadian, United States and other laws. Forward-looking statements in this release may include, among others, statements regarding the future plans, costs, objectives or performance of Innovation Metals Corp. (“IMC”), or the assumptions underlying any of the foregoing. In this news release, words such as “may”, “could”, “would”, “will”, “likely”, “believe”, “expect”, “anticipate”, “intend”, “plan”, “goal”, “estimate” and similar words and the negative forms thereof are used to identify forward-looking statements. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that are beyond IMC's control, and which may cause the actual results, level of activity, performance or achievements of IMC to be materially different from those expressed or implied by such forward-looking statements. Such risks and uncertainties could cause actual results and IMC’s plans and objectives to differ materially from those expressed in the forward-looking information. IMC can offer no assurance that its plans will be completed. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. Except as required by law, IMC assumes no obligation to update forward-looking information should circumstances or management’s estimates or opinions change.

Contact:                                                       

Dr. Gareth Hatch, Chairman and CEO
Innovation Metals Corp.
Telephone: +1-416-477-2412 
Email: info@innovationmetals.com
Web: www.innovationmetals.com