Pensana plans to move to new Saltend location
PLANS for Pensana to move its £150m rare earth refinery to a larger site on Saltend Chemicals Park have been approved. It is switching plots on the huge industrial site east of Hull, as it ensures it has room to add further phases to the operation.
Recycling of turbines has been added to the scope of the development since it was first outlined in late 2020.
East Riding Council passed the proposal, with 125 jobs anticipated to be created in the first steps of a magnet metal supply chain, a core element of electrical development in cars and renewable energy development.
It will reduce global dependence on Chinese production, with Pensana owning mining operations in Africa to feed the Humber plant, where 5 per cent of global demand could emerge from.
Paul Atherley, chairman, said: “We are delighted that the strategic importance of Pensana’s Saltend facility has been recognised by East Riding Council, and that the planning application for a larger site has been approved.
“This will bring high-value jobs to the local area and allow us to expand further into downstream production, as part of our plans to create a world-class, independent, and sustainable supply of rare earth metals for electric vehicles, offshore wind and other strategic industries.”
Pensana’s chief commercial officer, William Izod, told councillors that 90 per cent of the world’s magnets are currently produced in China, and their near monopoly could result in them dictating prices and limiting exports.
Electric cars need roughly one kilogram of magnet, while a 260m wind turbine can use seven tonnes.
The switch sees it head from the west of the site, bordering the port, to the northern entrance, on an undeveloped triangle between Paull Road and the A1033 Hull Road.
Backing the move, Cllr John Whittle, chair of East Riding of Yorkshire Council, said: “If this is going to enhance the robustness of our country it must be supported.”
It comes as a £4m public investment from the Government’s Automotive Transformation Fund has been touted, a move seen as unlocking further private investment for the London-listed entity, with front end engineering design work now complete and further defined finances also presented.
In a recent City update, Mr Atherley said: “The strong fundamentals and robust economics provide a solid platform for the financing and development of the project.
“The growing concerns over supply chain resilience and the burgeoning demand for magnet metals from the electric vehicle and offshore wind sectors is reflected in the growing customer demand for our products.”
With an initial capital requirement of £394m across both ends of the initial supply chain, stretching from the Longongo mine to the site east of Hull, revenues £780m and earnings at £503m have been predicted for the first five years.
The study was carried out by leading technical consultants from Wood, SRK, Snowden Mining Industry Consultants and Paradigm Project Management.
Discussions are underway for half of the refined product to be taken by an Asian magnet manufacturer, with a potential further 30 per cent to be marketed by a major trading house.
Talks have also been held with leading players in the Europe and US automotive supply chains.
“It is anticipated that this growing interest in the products planned to be produced from Saltend will be translated into formal offtake agreements over the forthcoming weeks and months,” the statement added.