UK based ZincOx say significant progress has now been made following some technical difficulties in starting their rotary hearth based process to treat EAF dust to recover both zinc and iron as hot briquetted DRI.
Construction of the plant designated KRP1 was completed in April 2012. ZincOx say the process has now been successfully demonstrated with the first consignment of zinc concentrate delivered to Korea Zinc and production is ramping up.
ZincOx are using the Rotary Hearth Furnace route to treat EAF which, untreated, has a penalty to pay if land filled due to its high zinc, cadmium and lead content. Removal of the heavy metals enabled the residue to land-filled without high penalty and also recovers zinc as a valuable by-product. The conventional approach to treat such dust is to use the Waelz kiln to produce a zinc concentrate for sale to zinc smelters.
At the end of 2009, ZincOx applied for Foreign Investment Zone status for the site in South Korea and this was granted in May 2010. This status provides the plant with a number of tax benefits including a tax holiday for seven years. It also enabled the Korean government to purchase a site for the plant for which they paid US$20M and in December 2010 a 50 year lease was entered into under which the first five years are rent free. Financing for the project was through a combination of ZincOx’s own equity (US$60M) and loans provided by Korea Zinc (US$50M), one of the world’s largest zinc metal producers. Following a memorandum of understanding in December 2010 definitive agreements with Korea Zinc were entered into in April 2011. Under these agreements, Korea Zinc provided development loans for KRP1 and will purchase all the zinc concentrate, at market rates, produced from KRP1. Zinc concentrate produced by a second proposed recycling plant KRP2 is not subject to these agreements.
KRP has been designed to treat 400kt/y of electric arc furnace (EAF) dust using two plants. The dust is being supplied by all Korea’s steel recycling companies under a 10 year supply agreements. A number of sampling campaigns over the past 5 years have demonstrated that the EAF dust contains about 23% zinc and 28% iron.
The KRP site covers 9.2 hectares in the Cheonbuk Industrial Complex, which lies about 10km south west of Pohang, Korea’s largest steel making city.
KRP is being developed in two equal phases. Having completed KRP1, it is intended that the development of KRP2 will commence before the end of 2012. The financing of KRP2 is already being progressed through ongoing discussions with banks. When in full production both KRP1 and KRP2 combined are expected to produce 92kt of zinc concentrate a year and about 100kt of iron as HBI.
The construction of KRP2 will be greatly assisted by the experience acquired through the recent development of KRP1.
At a current zinc metal price of US$2250/t and using current energy costs, KRP1 when operating at 200kt/y of feed dust is expected to generate approximately US$31.2M of earnings a year, before interest, tax, depreciation and amortisation.
ZincOx has also been active in Thailand for several years, and the Company has plans for a plant similar in size to KRP1. This plant (SEARP) would treat EAF dust generated throughout the South East Asian region. The Company has re-engaged with various steel companies for the provision of their EAF dust under long term supply agreements.
Copies of ZincOx Resources PLC Annual Report for 2011 can be downloaded from