Allup Silica faces serious ESG issues with its planned Antwalker mine

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Investors beware!! On the surface Allup looks good. Demand for silica is skyrocketing driven by rapid growth in manufacturing of renewables kit, solar panels, smart devices and just about every other new and emerging tech that needs some pure grade silica. And supply is constrained, particularly from established producers in Asia, and this combined with growing demand works to force up prices. Does sound like a sure bet.

But is it?

Ask the question why is it now supply-constrained? Well, Asian governments are increasingly concerned about the environmental impacts of silica sand extraction. The really good (pure) stuff comes from environmentally sensitive areas such as riverbeds and based on valid ESG (Environmental, Social and Governance) concerns, governments in Asia and elsewhere are restricting this sort of extraction.

Just a few years ago, ESG was a slogan - a mere soundbite. It was a box to be ticked in the feasibility and approvals process. Now it is crucial to the financial feasibility and sustainability of extraction projects. Regulators and importantly the broader market, require high standards with regards to ESG in the mining sector.

Allup’s plans to push ahead with the Antwalker project, a large open pit silica sand mine within the water catchment area of the State Forest located just a few hundred metres from Karri Lake and the peaceful settlement of Quinninup, completely fails to meet those required ESG standards.

The Quinninup community, for its part, is well organised, united, energised and highly motivated to oppose the mine on ESG grounds. None of us want a mine on our doorstep - one that destroys the beauty and amenity of the lake and its surrounds.

Importantly the community is well informed. We have formed a team under the Quinninup Community Association known as the QCA Stakeholder Coalition (SC) that draws on legal, environmental, mining, transport, as well as communications and other expertise. We have experienced activists and we have the ability to communicate our concerns across a broad range of media, as can be seen by our growing presence on social media, our dedicated website and a recent ABC report.

In many of the key areas of concern, we have established knowledge and expertise and will use this to oppose the mine, at every stage of the process. As an example, we have researched and analysed transport and haulage issues. We have interrogated a range of data sets, including the Main Roads RAV network and supply chain GIS data, we have considered what PBS options are available, and we have researched loading options and capacity at the 2 ports. Importantly we have interviewed and engaged with transport operators, Main Roads representatives, port operators and even other silica sand miners. We have carried out some simple transport modelling based on a range of production scenarios and haulage capacities, in order to calculate trucking frequency. We are doing this to increase awareness of how your mine haulage will impact on main street amenity of key towns such as Bridgetown, and to further build community opposition to your planned mine at Antwalker.

We likewise have accumulated considerable knowledge of the unique flora and fauna in the area, and the region’s complex water governance and hydrological issues. It is becoming clear that these and many other issues will present too many ESG-related challenges for Allup to develop a defendable business case for Antwalker.

Investors: find another project to invest in – this one will be bogged down in ESG issues and will not deliver your expected returns.

Allup: your website is correct. Antwalker is not as straight forward as your other projects. Find another project that will allow you to graduate from explorer or junior miner status. Don’t ruin the amenity of Quinninup and destruction of its environs, just so you can get a seat at the table. You need to find another way.

Monday April 11th, 2022