Zeotech secures $204 million kaolin deal

Zeotech has struck a landmark kaolin direct shipping ore (DSO) offtake agreement with Jiangsu Mineral Sources International Trading Co, Limited (MSI).

MSI is one of the world’s leading bulk raw material traders and will hold exclusive rights to market Zeotech’s kaolin products in China, Taiwan, Hong Kong, South Korea and Japan. Zeotech aims to produce kaolin from its Toondoon project in Queensland.

The five-year agreement is valued at approximately $204 million based on year one pricing, delivering an expected average net margin of more than 45 per cent over the term.

Committed volumes total 950,000 tonnes, exceeding the company’s previously forecast production and underscoring strong market demand.

“Partnering with MSI, one of the world’s leading bulk raw material trading companies, represents a major commercial milestone for Zeotech and highlights the outstanding quality of our kaolin resources,” Zeotech chief executive officer James Marsh said.

“This agreement establishes Australia’s largest kaolin offtake and positions the company to generate early cash flows, which remain a key priority.

“The capital generated will provide a strong platform to advance the AusPozz project and support our goal of contributing to the decarbonisation of concrete in the built environment.”

The deal sets Zeotech on a clear path to production, with capital costs estimated at $7.6 million over the first two years. The company is exploring ways to fund year two with cash flows from the first year.

Approvals for the Toondoon kaolin project are well advanced, with mining expected to begin in the first half of 2026. All shipments will move through the Port of Bundaberg, where Zeotech is working with Gladstone Ports Corporation to develop bulk storage and processing facilities.

The agreement includes standard terms for termination and automatic extensions, providing long-term stability for the company’s growth.