Shares in Orbite Aluminae Inc. soared more than 25 per cent in heavy trading on news the company has locked up a buyer for all of its anticipated production of smelter-grade alumina at its Quebec plant.
The stock rose to a high of 99 cents before easing back to 86 cents – up 16 cents on the day, or 22.8 per cent – in trading on the Toronto Stock Exchange on Tuesday.
The junior mining company said it has struck a deal with Glencore International AG to sell to Glencore 100 per cent of the smelter-grade alumina from Orbite's proposed plant in Cap-Chat, Que.
The agreement is for a 10-year period from the start of commercial production.
Glencore is a subsidiary of Glencore Xstrata PLC, the global commodities trader and mining giant, with pro forma revenue of $236-billion (U.S.) last year.
Orbite also said on Tuesday it plans to discuss the possibility of Glencore taking a financial position in the ownership and operation of the Cap-Chat facility.
Montreal-based Orbite says it has completed the basic engineering work for the smelter-grade alumina plant, using clay from its Grande-Vallée deposit in the Gaspé region of Quebec.
Alumina is the white powder used in the production of aluminum.
Under chief executive Richard Boudreault, Orbite has developed a patented, low-cost technology that extracts alumina from clay, through an acid-leaching process.
The company says it also plans to produce other high-value byproducts such as rare earth and rare metal oxides.
Editor's note: An earlier online version of this story incorrectly identified Richard Boudreault as the founder of Orbite, and incorrectly stated that he developed the company's patented technology. This online version has been corrected.