Join our daily newsletter At The Bell to receive exclusive market insights
Calix Ltd (ASX:CLX) has seen its shares soar to 60cps on Monday trades after teaming up with none other than Rio Tinto to establish a ‘green iron’ demonstration plant in Kwinana, using Calix’s ‘Zero Emissions Steel Technology,’ or ‘Zesty.’
Listen to the HotCopper podcast for in-depth discussions and insights on all the biggest headlines from throughout the week. On Spotify, Apple, and more.
The A$35 million deal sees Rio Tinto ink a Joint Development Agreement (JDA) with Calix, which was described as “non-exclusive” on Monday. Rio will submit $8M in cash to Calix and “further in-kind contributions” towards making up the total $35M figure; two tranches of the $8M are subject to a positive FID.
Rio, for its part – assuming it likes what it sees – has the option to “take up shares” in a “Zesty subsidiary business” to the value of $8M; and Rio may also “use the Zesty technology under a global and perpetual non-exclusive licence agreement, and/or market and sub-licence Zesty to its affiliates and steelmaking customers.”
Funds from Rio will go towards matching earlier-announced funding from an ARENA grant award for the green steel project; in at $45M.
“Subject to a positive FID and construction of the plant, Rio Tinto will provide up to 10,000 tonnes of a range of Pilbara Iron Ores for use in plant commissioning and operations, and introductions to potential users of the Zesty green iron product for material testing and downstream processing to steel,” Calix wrote on Monday.
“This strong support from Rio Tinto provides further validation of the potential for the Zesty technology to be deployed to the world’s largest minerals and metals market, its potential to help decarbonise a critical industry responsible for ~8% of global CO 2 emissions, and the opportunity to help future- proof Australia’s largest source of export income,” Calix CEO Phil Hodgson said.
CLX last traded at 60cps.
Join the discussion: See what HotCopper users are saying about Calix Ltd and be part of the conversations that move the markets.
The material provided in this article is for information only and should not be treated as investment advice. Viewers are encouraged to conduct their own research and consult with a certified financial advisor before making any investment decisions. For full disclaimer information, please click here.
