TIDMSRES
RNS Number : 5216M
Sunrise Resources Plc
15 September 2023
15 September 2023
SUNRISE RESOURCES PLC
("Sunrise" or the "Company")
Market Study and Pozzolan Project Update
Sunrise Resources plc is pleased to provide the following
project update and to release the findings of a market study
commissioned by the Company to evaluate market opportunities and
market growth predictions for cement and the use of supplementary
cementitious materials ("SCMs"), including natural pozzolan, in the
USA, and California and Nevada in particular.
Key Points
The Market Study:
-- was commissioned by the Company with Cement Distribution
Consultants, Amsterdam to examine the cement markets in California
and Nevada which are being targeted by the Company with its CS and
Hazen natural pozzolan projects in Nevada.
-- provides the Company with a detailed breakdown of cement
markets, county by county in California and for the two main
population centres in Nevada (Reno-northern Nevada and Las
Vegas-Henderson).
-- details the production profiles of all cement producers and
ready-mix companies in California and Nevada and details movements
of cement within and between different US states.
Forecasts, considering the US as a whole:
-- The consumption of cementitious materials (including ordinary
Portland cement) is forecast to increase at 10% annualised rate
from just over 129 million tonnes in 2021 to over 154 million
tonnes by 2030.
-- The production of ordinary Portland cement will be largely
static as no new cement plants will be built or existing plants
expanded.
-- The increased consumption of cement will come entirely from increased use of the main SCMs.
-- US consumption and production of natural pozzolan will
increase from a very low base in 2021 to nearly 6 million tonnes
per annum by 2030.
Forecasts for California and Nevada:
-- Production of natural pozzolan is forecast to increase
substantially in both states based on known resources of volcanic
natural pozzolan which include both the Company's Hazen and CS
Projects in Nevada.
-- The Company's natural pozzolan projects are well placed to
benefit from these structural changes in the cement and concrete
industries.
-- California and Nevada together are expected to produce 62% of all SCMs consumed in the US.
_________________________________________________________________________
Commenting today, Executive Chairman Patrick Cheetham said:
"The study that we have commissioned provides a detailed
breakdown by volume and location for all cement production and use
of cement and SCMs in the USA, and is already proving to be a
useful tool in our endeavours to find a development partner for our
natural pozzolan projects in Nevada."
"The Company is currently waiting for a bulk sample from its
Hazen natural pozzolan project to be test ground in a commercial
grinding mill by an existing producer of natural pozzolan. It is
also discussing joint development of its CS Natural pozzolan
Project with three companies. One, a large cement and ready-mix
group, has successfully completed an extensive programme of
testwork. The second is a materials company that is currently
undertaking its own testwork programme on CS natural pozzolan. The
third is a cement company that is just starting its evaluation of
the project."
_________________________________________________________________________
Further information:
Sunrise Resources plc Tel: +44 (0)1625 838 884
Patrick Cheetham, Executive
Chairman
Tel: +44 (0)207 628 3396
Beaumont Cornish Limited
Nominated Adviser
James Biddle/Roland Cornish
Tel: +44 (0)207 469 0930
Peterhouse Capital Limited
Broker
Lucy Williams/Duncan Vasey
Shares in the Company trade on AIM. EPIC: "SRES".
Website: www.sunriseresourcesplc.com
Market Abuse Regulation (MAR) Disclosure
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 which forms part of
UK domestic law by virtue of the European Union (Withdrawal) Act
2018 ('MAR'). Upon the publication of this announcement via
Regulatory Information Service ('RIS'), this inside information is
now considered to be in the public domain.
Detailed Information
The following information has been extracted from a market study
commissioned by the Company with Cement Distribution Consultants of
Amsterdam ("CDC") to examine the cement markets in California and
Nevada which are being targeted by the Company with its CS and
Hazen natural pozzolan projects in Nevada.
The market study provides the Company with a detailed breakdown
of cement markets, county by county in California and for the two
main population centres in Nevada (Reno-northern Nevada and Las
Vegas-Henderson). It also details the production profiles of all
cement producers and ready-mix companies in these two states and
details movements of cement within and between different US
states.
Much of the information is commercially sensitive but summary
information of possible interest to shareholders has been included
in this news release.
Moreover, the report is helping the Company to identify a wider
range of potential partners for the development of its natural
pozzolan projects in Nevada.
Cement Markets
California cement production of around 10.7 million tons per
annum ("mtpa") is located almost entirely in southern California.
CalPortland Cement ("CPC", a subsidiary of Japan's Taiheiyo Cement
Corporation in Japan) is the largest cement producer in California
with an installed capacity of 4.5 mtpa. Cemex is second with 3.1
mtpa and Mitsubishi is the third largest with a capacity of 1.4
mtpa. The California plants are currently working at a
high-capacity utilisation.
Only CalPortland's Redding plant with a capacity of about 0.6
mtpa supplies northern California directly following the closure of
Heidelberg Cement's Permanente plant at Cupertino near San José in
northern California.
The cement market in Nevada is much smaller than in California.
Nevada's cement consumption in 2022 was 1.7 mt. Of this volume
about 0.7 mt is produced in Nevada's only cement plant at Fernley
by Nevada Cement (Eagle Materials) and the rest is supplied from
California, Arizona and Utah. Nevada Cement has a rail terminal in
Sacramento, supplied from its Fernley cement plant and it has
recently purchased a ship import terminal in Sacramento.
The California cement market is strongly influenced by the
overall cement market in the wider Southwest US as the combined
states of Nevada, Arizona, Utah, New Mexico and Colorado have a
structural cement deficit which is compensated from the cement
plants in southern California.
When cement consumption is low in the region, the region is
largely self-sufficient with only small inflows from the large
cement plants in southern California. These plants then supply a
significant part of their production by rail to the northern
California market. In these periods (e.g. during and after the 2008
- 2011 financial crisis) there are no cement imports into
California.
When cement consumption in the southwest US grows then an
overall deficit builds and this is then filled by the cement plants
in southern California which direct their output more to the region
and reduce the supply (by rail) to northern California. The
corresponding shortage in northern California is then resolved by
imports from Asia via the ship terminals. The ship terminals are
mainly owned by the cement producers. When cement demand in the
southwest US grows further the cement plants in southern California
direct more cement to the region and when they cannot fully supply
the southern California market anymore the local cement terminals
in the port of Los Angeles, Long Beach open up. Here, also, the
import terminals are owned by the cement producers.
Ready-Mix Companies
Most cement and SCM's are destined, with sand and gravel
aggregates, for the production of concrete in pre-cast concrete
structures or for use by the ready-mix industry.
In California and Nevada, the production and sale of concrete is
dominated by the major cement producers who are vertically
integrated. Nevertheless, there are a significant number of large
independent ready-mix companies owned by non-cement producing
materials (aggregate) companies, some of which are showing interest
in adding natural pozzolan to their mix of products.
Natural Pozzolan
All of the cement producers in southern California have shown
interest in natural pozzolan as an SCM and CPC is currently
permitting a deposit of natural pozzolan near to their Mohave
cement plant in southern California. In northern Nevada, Nevada
Cement is producing natural pozzolan from a third-party quarry near
Reno.
Independent production of natural pozzolan is currently taking
place at dedicated grinding plants in Utah (Geofortis) and Arizona
(Kirkland Mining & Drake Cement) where the market is either
internal or with the ready-mix companies and with fly ash suppliers
producing blended fly ash/natural pozzolan products.
Market Forecasts
In the Company's announcement of 23 May 2023,which followed the
2023 Symposium of the Natural Pozzolan Association, the Company
presented its views on the direction of travel of the cement
industry which is looking to reduce the Portland cement clinker
component in cement manufacture through the introduction of 1L, 1P
and 1T cements where limestone (1L) and natural pozzolan (1P) are
introduced as clinker extenders and substitutes or used together in
Ternary blends (1T).
CDC has provided the Company with forecasts to 2030 of
consumption and production of cement and the three main
volumetrically important SCMs - fly ash, ground granulated blast
furnace slag ("GGBS") and natural pozzolan. This data has been
provided independently from the market study commission by the
Company. The forecasts are detailed and cover every state in the
USA. CDC has also provided 2021 figures for comparison which is
taken as a baseline year when natural pozzolan was in its
infancy.
The forecast and comparison are shown the attached Tables 1-3
which show the 2030 forecasts and 2021 comparisons for the US as a
whole, and for California and Nevada separately.
Considering the US as a whole, Table 1 shows that:
-- the consumption of cementitious materials (including ordinary
Portland cement) is forecast to increase at 10% annualised rate
from just over 129 million tonnes to over 154 million tonnes by
2030.
-- the production of ordinary Portland cement will reduce,
albeit marginally, as no new cement plants will be built nor
existing plants expanded so cement clinker production will be
relatively steady.
-- the increased consumption of cement will come entirely from
increased use of the main SCMs through the production of blended
cements or by blending SCMs and cement at the ready-mix or casting
plants or at various cement terminals.
-- fly ash production will reduce from over 24.3 mtpa in 2021 to
15.7 mtpa in 2023 but consumption will increase and be met from
overseas imports and/or reclamation of historically ponded fly
ash.
-- US consumption and production of GGBS will increase
marginally, constrained by domestic and international availability,
and changing iron and steel making technologies.
-- US consumption and production of natural pozzolan will
increase from a very low base to nearly 6 mtpa by 2030.
Whilst looking at the US is instructive, when those same
statistics are considered on state-by-state basis there are
substantial regional differences. These differences arise due to
the availability of different SCMs in different states, transport
costs and state-to-state infrastructure etc., as well as varying
state legislation on mandating SCM use and decarbonisation of the
cement industry.
Of primary interest to Sunrise are the target markets in
California and Nevada.
Tables 2 and 3 show comparable statistics for California and
Nevada respectively for 2021 and 2030. The tables show that:
-- production of cement will increase in both states through
increased use of SCMs in line with predicted national trends.
-- consumption of fly ash will increase only marginally and the
production of fly ash in Nevada will cease. This reflects the lack
of fly ash production and ponded fly ash in California and
Nevada.
-- production of natural pozzolan will increase substantially in
both states based on known resources of volcanic natural pozzolan
which include both the Company's Hazen and CS Projects in
Nevada.
-- California and Nevada together are expected to produce 62% of all SCMs consumed in the US.
Project Updates - Hazen and CS Natural Pozzolan Projects
The Company's natural pozzolan projects are well placed to
benefit from these structural changes in the cement and concrete
industries and the forecast increase in the market for natural
pozzolan.
The Company is currently waiting for a bulk sample from its
Hazen pozzolan project to be test ground in a commercial grinding
mill by an existing producer of natural pozzolan. It is also
discussing joint development of its CS Project with three
companies. One, a large cement and ready-mix group, has
successfully completed an extensive programme of testwork. The
second is a materials company that is currently undertaking its own
testwork and the third is a cement company that is just starting
its evaluation of the CS Project.
Note: The news release contains certain statements and
expressions of belief, expectation or opinion which are forward
looking statements, and which relate, inter alia, to the Company's
market forecasts, proposed strategy, plans and objectives or to the
expectations or intentions of the Company's directors. Such
forward-looking statements involve known and unknown risks,
uncertainties, and other important factors beyond the control of
the Company that could cause the actual performance or achievements
of the Company to be materially different from such forward-looking
statements. Accordingly, you should not rely on any forward-looking
statements and save as required by the AIM Rules for Companies or
by law, the Company does not accept any obligation to disseminate
any updates or revisions to such forward-looking statements.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
UPDGPUUWBUPWGMC
(END) Dow Jones Newswires
September 15, 2023 02:00 ET (06:00 GMT)
Sunrise Resources (AQSE:SRES.GB)
Historical Stock Chart
From Nov 2024 to Dec 2024
Sunrise Resources (AQSE:SRES.GB)
Historical Stock Chart
From Dec 2023 to Dec 2024
