June 21, 2019

Orbite Shuts down Operations at its HPA Plant due to problems with Outotec Calcination Equipment

LAVAL, Québec, June 21, 2019 (GLOBE NEWSWIRE) -- Orbite Technologies Inc. (NEX: ORT.H) (“Orbite” or the “Company”) today announced the immediate shutdown of operations at the HPA Plant due to technical problems with the Outotec calcination equipment.

(Definitions of the capitalized terms used herein can be found at the end of this press release.)

  • As previously disclosed, the start-up bed of amorphous HPA was injected into the decomposer and it was filled to its operational level. The upstream hydrometallurgical section was also in full operation and ACH crystal transfer into the decomposer had commenced.
  • Purity of the ACH material produced in the hydrometallurgical section is excellent and is superior to 5N purity (5N+ HPA equivalent).
  • Orbite successfully operated the decomposer over several weeks and reached ACH crystal injection rates of 5 tpd (equivalent to1 tpd of HPA) and maintained a steady injection rate between 3 and 4 tpd for 4 days.
  • The transfer of gamma HPA from the decomposer into the calciner was successfully done at rates up to 2.5 tpd of HPA.  
  • The calciner was almost filled to operating levels and Orbite was starting to discharge HPA from the calciner when operations observed abnormal variations with the material fluidisation in the calciner bed, leading to the breakage of four ceramic heating tubes in the calciner and one ceramic heating tube in the decomposer.
  • After careful analysis of the available data with Outotec’s onsite representative, Orbite has determined that despite the numerous modifications made to the calcination system over the past several months, the electrical heating system, as designed and supplied by Outotec, is not robust enough to reliably achieve the production of HPA without experiencing breakages and production slow downs.
  • After discussions with its legal advisors and the court appointed Monitor, the Company has determined there is not enough time or financial resources to try to once again address the technical issues encountered with the Outotec supplied equipment whilst remaining under CCAA protection.
  • Accordingly, Orbite will immediately implement significant cost reduction measures with a view to improving its cash-flow situation to allow Orbite, with the assistance of the Monitor to conduct a SISP. The cost reduction measures will include:
    • Shutting down operations at the HPA Plant;
    • Implementing a care and maintenance plan for the HPA Plant; and
    • proceeding with the temporary lay-off of all non-essential employees. 
  •  A number of employees will remain until operations at the HPA Plant are safely terminated. The remaining employees will assist the Monitor in implementing the next steps and in maintaining the security and integrity of the plant equipment.
  • Orbite deeply regrets this turn of events. The Orbite process, once again performed extremely well with 5N+ precursor materials produced at stable, industrial production rates and 4N7 HPA produced on the first production run, a remarkable achievement.
  • The shutdown of operations is the direct result of supplied equipment and not a process issue.

“I would like to thank all of our employees and our financial partners that have supported us over the last two years and have worked so extremely hard to resolve the issues with the Outotec calcination equipment.  Our process was yielding, on a consistent basis, the highest purity levels we had ever attained at the plant and we were well positioned to achieve our goal to exit from CCAA protection while protecting all of stakeholder’s interests. Unfortunately, the industrial inadequacy of the Outotec supplied calcination equipment, which forced us into CCAA protection in 2017 will now push us into a sales or liquidation process. 

Close to 30M$ was invested by Orbite in purchasing and installing this equipment and over $7.5M by Outotec in designing and implementing solutions to the original design deficiencies encountered in 2017. Unfortunately, despite all the time, financial resources and effort involved, the Outotec calcination equipment is still inadequate and flawed. stated Glenn Kelly, CEO of Orbite.

The Company will provide further updates as developments occur.

Definitions

CCAA: Companies’ Creditors Arrangement Act.

HPA Plant: the Company’s high purity alumina (HPA) plant, in Cap-Chat, Québec.

ACH: aluminum chloride hexahydrate, the precursor to high purity alumina.

SISP: Sale and Investment Solicitation Plan

5N: 99.999 and 4N7: 99.997

Tpd: tonnes per day.

About Orbite

Orbite Technologies Inc. is a Canadian cleantech company whose innovative and proprietary processes are expected to produce alumina and other high-value products, such as rare earth and rare metal oxides, at one of the lowest costs in the industry, and in a sustainable fashion, using feedstocks that include aluminous clay, kaolin, nepheline, bauxite, red mud, fly ash as well as serpentine residues from chrysotile processing sites. Orbite is currently in the process of finalizing its first commercial high-purity alumina (HPA) production plant in Cap-Chat, Québec and has completed the basic engineering for a proposed smelter-grade alumina (SGA) production plant, which would use clay mined from its Grande-Vallée deposit. The Company's portfolio contains 15 intellectual property families, including 41 patents and 17 pending patent applications in 11 different countries and regions. The Company also operates a state of the art technology development center in Laval, Québec, where its technologies are developed and validated.

Forward-looking statements
Certain information contained in this document may include "forward-looking information". Without limiting the foregoing, the information and any forward-looking information include statements regarding projects, costs, objectives and future returns of the Company or hypotheses underlying these items. In this document, words such as "may",” confident”, "would", "could", "will", "likely", "believe", "expect", "anticipate", "intend", "plan", "estimate" and similar words and the negative form thereof are used to identify forward-looking statements. Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. Forward-looking statements and information are based on information available at the time and/or the Company management's good-faith beliefs with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond the Company's control. Risks, uncertainties and other factors that could affect anticipated results and future events also include, but are not limited to, those described in the section of the Management's Discussion and Analysis (MD&A) entitled "Risk and Uncertainties" as filed on July 28, 2017 on SEDAR, including those under the headings “Going Concerns”, Commercial Operation of HPA Plant”, “We will need to raise capital to continue our growth” and “Development Goals and Time Frames” described in the MD&A filed on March 31, 2017.

The Company does not intend, nor does it undertake, any obligation to update or revise any forward-looking information or statements contained in this document to reflect subsequent information, events or circumstances or otherwise, except as required by applicable laws.

CONTACT INFORMATION:
FOR MORE INFORMATION, PLEASE CONTACT:
Orbite Technologies Inc.
Geneviève Marchand, Corporate Secretary
Tel.: 450 680-3341
Email: info@orbitetech.com