How 5E Advanced Materials Plans to Unlock $725M Value at Fort Cady Boron Project

Project Overview and Strategic Importance

5E Advanced Materials, a critical infrastructure-designated company, has published a comprehensive Preliminary Feasibility Study (PFS) for its Fort Cady Project located in the Mojave Desert near Newberry Springs, California. The study outlines a 39.5-year mine life based on proven and probable mineral reserves of 5.4 million tons of boric acid at an average grade of 8.03% B2O3. The project is positioned to produce 130,000 short tons per year of boric acid using an environmentally sensitive in-situ leaching (ISL) method, minimizing surface land disturbance.

This project is a cornerstone of 5E’s strategy to become a vertically integrated global supplier of critical boron and lithium materials, essential for electrification, energy security, food production, and defense applications. The Fort Cady deposit is among the largest new conventional boron deposits globally, underscoring its strategic value amid tightening supply chains.

Technical and Economic Highlights

The PFS presents robust economics with a pre-tax net present value (NPV7) of US$724.8 million and an internal rate of return (IRR) of 19.2%. The initial capital expenditure for Phase 1 is estimated at US$435 million, which includes a cogeneration power facility to support plant operations. Operating costs, including logistics and raw materials, are forecasted at US$554.80 per ton of boric acid, reflecting detailed material and energy balances.

The mining plan leverages 27 directional wells targeting multiple mineralized horizons, with advanced horizontal drilling techniques increasing ore contact and recovery efficiency. The processing plant design incorporates a two-stage vacuum chilled crystallization system followed by recrystallization to ensure high-purity boric acid production, validated by extensive metallurgical testing.

Market Context and Supply-Demand Dynamics

Global boric acid demand is forecasted to grow at a compound annual growth rate of 5.5%, reaching 1.83 million metric tonnes by 2033. Supply constraints, dominated by a duopoly controlling 85% of the market, have led to a tightening market with prices stabilizing around $1,000 per short ton and expected to rise further. 5E’s Fort Cady Project is well positioned to capture this market opportunity, supplying approximately 11% of current global demand upon ramp-up.

By-products such as calcium chloride and gypsum will also contribute to revenue, with local markets in California targeted for these materials. The company has initiated offtake discussions with multiple end-users and distributors across various sectors, including specialty glass, agriculture, and defense.

Permitting, Infrastructure, and Next Steps

The project benefits from a strong permitting foundation, including mining permits dating back to 1994 and an Underground Injection Control permit from the EPA issued in 2020. Mining operations commenced in January 2024 at a small-scale facility, providing valuable operational data that has informed the PFS design and cost estimates.

Infrastructure plans include natural gas pipeline connections, electrical power upgrades with cogeneration, road improvements, and potential rail access for future expansion phases. Environmental considerations have been addressed through comprehensive impact studies and reclamation plans.

5E plans to advance to definitive feasibility and Front End Engineering Design (FEED) with an estimated $6.6 million budget, aiming for commercial-scale production by 2028. The company is also focused on securing long-term project financing and finalizing offtake agreements to underpin development.