River Sand Projects
River Sand Projects
Derby, Onslow and Gascoyne,
Western Australia
In December 2020, Cauldron entered agreement where it will stage the consideration payments for 100% ownership of eight high-quality river sand exploration licences and mining leases, covering a total of 482 km2, situated at the mouths of the Fitzroy, Ashburton and Gascoyne rivers in Western Australia. Cauldron has secured and is in the process of transferring a mining lease and several exploration licences located on three of these river systems.
3 Projects: Fitzroy Sand, Ashburton Sand and Gascoyne Sand
8 tenements covering ~482km2 of high-quality river sand
100% Cauldron-owned (secured by sale agreement and conditional on ministerial approval)
Full operational management
Approved Mining Licence secured for up to 500,000 tonnes/annum initial export
Cauldron poised and ready to tender for long-term international supply contracts
International sand/aggregate market estimated to grow by 5.5% per year to approx. US$60 billion from US$4.5 billion in 2017
Cauldron’s acquisition of the River Sand leases affords the potential of low-cost sand supply to target premium seaborne export markets, and helps to fulfil part of the Company’s ongoing commitment to achieving net zero carbon footprint. This is achieved by the reduced mining, handling and truck haulage involved which invests less carbon into the product and, thus, reduces the carbon footprint of the supply of sand.
Global Sand Market
After water, sand is the most used resource globally, with 50 billion tonnes of sand and gravel being used in the world each year1. The global sand export market is non-centralised and made up of many disparate clusters of activity collectively accounting for movement of the estimated 50 billion tonnes of sand annually. To put this in context, it is more than 10 times the 4 billion tons of oil used globally every year2.
Sand is by far the largest globally mined commodity, outstripping the shipments of coal, iron ore and grain. Sand is not traded on any recognised exchange, however the United Nations estimates 40 billion tonnes of sand3 is mined globally each year. To put this in context, according to the International Energy Agency, the next largest bulk commodity, in terms of tonnage moved, is coal at about 3.5 billion tonnes in 2018.
The global sand market however lacks transparency with no central market due to localised supply/demand relationships. This makes it difficult to publish a commodity price in the usual sense. Potential offtake parties, however, are always on the search for good quality material and will pay the price needed to secure its sale.
The consumption of sand in the developing world is voracious. Sand, or silica dioxide (SiO2), has in terms of bulk tonnage three main uses:
- Land reclamation and island building (largest bulk commodity use at 28 billion tonnes per annum)
- The manufacture of concrete (12 billion tonnes per annum)
- Specialised glass manufacture, such as that used for phone screens (cost per tonne currently exceeds USD$1000/tonne). Total usage is approx. 300Mt, or 0.3 billion tonnes, per annum globally.
The third usage represents the target area for most silica sand miners as the high value, high margin products capable of absorbing high processing and transport costs.
Cauldron has recognised that high-quality river sand, as a bulk commodity in its own right, is distinct from desert, dune or marine sand which is found in relatively high quantities. Ideally, river sand comprises more angular particles with higher silica content, naturally sized by river action and made angular by the reduced period of erosion in river systems, as opposed to marine or desert environments. These angular particles are capable of interlocking which offers greater load bearing capacity when mixed with cement, a quality which makes river sand much sought after for construction. Recent global growth, particularly in Asia, has created a scarcity in this commodity and an associated demand-driven price rise sufficient to justify sea-borne transport.
