Here’s why the WA Kaolin (ASX:WAK) share price is up 16% today

A long term fuel supply deal has lifted the mineral company’s share price today. We take a closer look at the details.
The post Here’s why the WA Kaolin (ASX:WAK) share price is up 16% today appeared first on The Motley Fool Australia. –

The WA Kaolin Ltd (ASX: WAK) share price is firmly in positive territory today. This comes after the company announced it has signed a long-term agreement to fuel its kaolin processing operations.

At the time of writing, the mineral company’s shares are fetching 21.5 cents, up 16.22%.

What’s pushing the WA Kaolin share price higher?

Investors are snapping up WA Kaolin shares after the company released a positive update.

According to its release, WA Kaolin has signed a massive 15-year contract with Mid-West LNG Pty Ltd, a subsidiary of Clean Energy Fuels Australia (CEFA).

Based in Perth, CEFA is an integrated energy solutions provider, developing small scale LNG infrastructure assets for regional mining, industrial, and commercial energy users.

Under the agreement, WA Kaolin will receive liquefied natural gas (LNG) for its Wickepin kaolin project. The LNG will be used to fire a rotary kiln to dry kaolin ore. It’s the first step in the company’s patented K99 dry processing method.

The deal will officially commence on 1 January 2022 and run for a period of 15 years, with reviews at each 5-year block. The contract includes two options that allow the parties to extend for another 5 years each.

In addition, the agreement includes the supply of commissioning gas from 1 September until 31 December 2021.

The contract value is estimated at around $22 million for the initial 15 years.

Words from the CEO

WA Kaolin CEO Andrew Sorensen welcomed the new deal, saying:

We are thrilled to have entered into a 15 -year contract with CEFA, one of WA’s leading energy solution providers. As we continue to progress our Stage 1 work program towards our target to be producing by year end 2021, it is vital for our development program that we lock in such important long term supplier agreements like this.

The Stage 1 work program at Wickepin continues on track and within budget and I look forward to providing the market with a further update of progression from on-site shortly.

About WA Kaolin

WA Kaolin is a mineral exploration, extraction and processing company aiming to develop kaolin products. The group hopes to market the soft white clay mineral to Asia and global markets.

Kaolin has a variety of applications, including in the paper industry where it serves as a paper coating. The mineral product is also used to make china, porcelain, tableware, rubber, cable insulation, specialty films, and fertilisers.

During the past 12 months, the WA Kaolin share price has fallen by around 14%. However, year-to-date performance has seen the company’s shares climb by more than 23%.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

*Returns as of February 15th 2021

More reading

BrainChip (ASX:BRN) share price tumbles on AGM update: What you need to know
Local shopping trend might boost neighbourhood ASX real estate shares

Why ALS, AMA, Chalice Mining, & Jumbo shares are pushing higher

The Commonwealth Bank (ASX:CBA) share price just reached $100
NAB (ASX:NAB) share price lifts amid reports of another pay scandal

The post Here’s why the WA Kaolin (ASX:WAK) share price is up 16% today appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!