The zircon industry has growth potential. Vol 135

Getting Started.

In the late 1980’s, while conducting alluvial gold exploration, I often visited Pelsart’s Ampalit alluvial gold project in Central Kalimantan. Exploration was largely undertaken with banka drills, with on- site panning to count colours, along with gold mineral studies etc. A floating cutter-suction dredge with primary processing (including spirals) was built, where concentrate was transferred to an on-shore gold finishing room. This was the first commercial alluvial gold mine since the Dutch left Indonesia. Ampalit was expected to produce 21,000 ounces of gold in its first year (1989). The project closed down in 1992 after a disappointing production of 11,861 ounces produced in 1991-92. Pelsart offset their closure costs by retreating a 12,000-ton stockpile of zircon sand, a by-product from the onshore alluvial gold processing plant. This was Indonesia’s first commercial sale of zircon. The sale of this zircon sand triggered the start for the thousands of artisans and illegal alluvial gold miners to include, or migrate their business, to zircon capture and sales. 

The local industry evolved, with some centralized purification process plants buying in mixed heavy mineral sand concentrate to produce various grades of zircon sand suitable for export and sale. PT. Cakra Mineral Tbk formalized this business model by acquiring some zircon tenements in Central Kalimantan (2014) and commissioned a centralized high tension process plant (2011). This plant also purchased and processed zircon sands from sub-contractor and artisan miners. Their 2016 production of zircon was reported at 6,000 metric tons, though the 2019 annual report states that no zircon sales were recorded in 2018 & 2019.

Zircon Mineral.

Zircon (Zr) is a non-metallic mineral with the chemical formula ZrSiO4, SG of 4-4.8 with a hardness of 7-7.5, and has a high lustre. Zircon sands have a bulk density of 2.71 Kg/m3. The main minerals containing zirconium are zircon/zirconium silica (ZrO2.SiO2) and baddeleyite/zirconium oxide (ZrO2). Most zircon minerals include some Hafnium, though this element does not impact on the commercial nature of zircon. The colour of zircon varies with trace elements. Zircon sands are typically found in commercial quantities in alluvial quartz sands, and are often associated with tin, ilmenite, monazite, hematite, magnetite and other weathering resistant heavy minerals. Zircon grains are usually under a millimetre.

Mineral sand deposits form along ancient coastlines where the hinterland is typically weathered granite and metamorphic complexes (including the Cretaceous granites of the Schwarner mountains of Kalimantan). The heavier minerals have been shed and transported by rivers, and may be further concentrated by waves and wind. These coast lines can be tens to hundreds of kilometres inland today (Kalimantan), or submerged under post glaciation rising sea levels (Banka). Unconsolidated re-worked mineral sand deposits are also found associated with today’s river systems. Most of Indonesia’s zircon sand deposits are found in Central and West Kalimantan, particularly around rivers. Zircon is notably associated with alluvial tin deposits in the Bangka Belitung area. The characteristics of zircon sand vary from place to place because of impurities in zircon sand as reflected by the variation in primary source.

Radiation factor.

Both uranium and thorium can substitute zirconium in the zircon lattice, which imparts a radioactive signature. The amount of radioactive “contamination” is derived from certain (not all) source granites however the substitution tends to be in individual crystals not in the whole zircon population, so targeted processing techniques can greatly mitigate the deleterious radiation count on zircon product. 

BAPETEN assessment showed the radiation activity concentration of U-238 and Th-232 in zircon reached 3.08 Bq /g and 1.04 Bq /g, respectively. In accordance with the document IAEA SRS-51, radiation safety for zircon has been regulated in BCR No 16 / 2013 on Radiation Safety in Storage of Technologically Enhanced Naturally occurring Radioactive Material (TENORM). The processing of zircon into other products can be undertaken through a report to BAPETEN. The safety regulatory of radiation on zircon also require coordination between BAPETEN with several agencies, such as: the Ministry of Energy and Mineral Resources, Ministry of Commerce, Ministry of Industry and Local Government in such a way that can increase industrial productivity zircon in Indonesia. The radiation characteristics of zircon vary between each location.

Zircon’s stability and common inclusion of radioactive elements in the lattice, is behind zircon playing an important role in radiometric dating of ancient rocks.

Example of prominent Indonesian zircon deposit- – PYX

The PYX web site and public stock exchange reports (Australia & London) provide an outline of one of Indonesia’s key zircon mines, and their public reports provide insight to Indonesia’s zircon mining industry:

PYX key deposits, Mandiri and Tisma, are large-scale, near-surface open pit alluvial deposits both located Central Kalimantan, Indonesia. PYX’s Mandiri deposit has been in production since 2015, and is the 2nd largest global zircon resources held by a producing company. In March 2019, Mandiri’s inferred Mineral Resources were evaluated at 126 million ton (with 7.43% heavy minerals) within an area of 2,032 ha. The zircon content within the heavy mineral assemblage is 64%. The average thickness of the alluvium is 3.68m.

In November 2020, Tisma’s Inferred Mineral Resources were evaluated with inferred 137 million ton (with 3.99% heavy minerals) within an area of 1,500 ha. The zircon content within the heavy mineral content is 82%. A PYX 2021 report states their JORC compliant zircon resources are 10.5 million ton.

The current capacity is 1,500 tons per month (18,000 tpa), and has been producing mostly a premium product with 65.5 grade zircon. Studies show the Heavy Mineral Concentrate (HMC) has 82% zircon, 8.5% ilmenite and 2% rutile.

Ore is extracted by contracted miners using hydraulic mining. The soil is pumped over riffle boxes to collect the heavy mineral concentrate. The HMC is then trucked by road to the Mandiri plant. The Mandiri plant consists of standard HMC processing equipment, including gravity shaking tables, dryers, electro-static separators and electro-magnetic separators, which separates the HMC to yield a saleable zircon product. The zircon product is then bagged and verified at the Mandiri plant by a factory and mining officer, loaded onto trucks and driven to the nearest Port at Banjarmasin where the zircon is sold and/or shipped to the customer.

The areas are subject to past and present small scale artisanal miners.

Price.

An announcement by PYX on 16 June 2021 reflects upon the recent spike in the global price of high-quality Indonesian zircon;

The 3^rd price increase for 2021 (US$ 1,750/ton) reflects the continued supply issues in South Africa and low inventory levels in China, which both triggering a general lack of premium zircon supply globally. Australian sales of Heavy Mineral Concentrate (HMC) to China have created a further void of premium zircon in the market, leading to higher customer demand and higher market prices, with Indonesian zircon prices having now reached their highest price point since 2013. A 4^th price increase (Sep 2021) to US$ 2,305/tonne relates to the closure of Rio Tinto’s Richards Bay Minerals operation in South Africa due to security concerns, along with increasing demand from China and the rest of the world.

Premium zircon, such as PYX’s, is in great demand for creating fused zirconia and other products, where standard zircon cannot be used. Premium zircon is in increased demand for high tech applications, such as Yttria Stabilized Zirconia (YSZ) for the electrolyte material for solid oxide fuel cells, playing a key role in the move to renewable energies. The continuing growing demand for green energy, the continued growth of the Chinese economy and recovery of European economies from the COVID-19 pandemic, suggest the zircon pricing environment is expected to remain strong in the medium- to long-term as lack of supply continues to grow.

Export & Import.

ESDM government Regulation 96 / 2021 classifies zircon (and rutile) as “non-metallic” minerals, though zirconium is classified as a metallic mineral. ESDM regulation 25 of 2018 sets out the minimum processing requirements for the export of zircon and associated minerals.

Government regulation 81 of 2019 sets the royalty on zircon at 4% of sales price. The Ministry of Trade No. 01/M-DAG/PER/1/2017 sets out export criteria (and export duty) for various forms of zircon, including zircon sand (ZrSi04), (ZrO2+HfO2) with size range 65-95% passing sieve mesh 60, also with size range of <65% passing sieve mesh 60.

Zircon is included in the ESDM regulation No. 67.K/HK.02/MEM.B/2021 regarding the Provision of Recommendations for Overseas Sales of Certain Mineral Products during the Covid-19 Pandemic period.

Table 1. BPS 2020 Indonesia Import & Export of Zircon Products.

HS Code	Commodity	Import Kg	Import $	Export Kg	Export $
2530910	Micronized zircon s& (zirconium silicate).	3,492,407	4,312,290	3,200,900	4,798,329
25309090	Other micronized zircon s& (zirconium silicate)	23,479,009	4,105,948	41,957,363	2,924,954
26151000	Zirconium ores & concentrated	738,819	1,420,573	64,151,837	83,811,643
26159000	Other zirconium ores & concentrates	117,628	382,495	No data	No data
28256000	Germanium oxides & zirconium dioxide	77,173	2,519,662	2	132
81092000	Unwrought zirconium powders	16,076	56,205	No data	No data
81093000	Zirconium waste & scrap	No data	No data	No data	No data
81099000	Other zirconium and articles thereof	14,849	133,276	No data	No data
TOTAL		27,935,864	12,930,349	109,310,102	91,535,058

Capital Funding.

PYX Resources has raised new capital based upon its Indonesian (Zr) & Australian mining projects. The PYX announcement of 9 November 2021 of its dual listing on the London (LSX) & Australian (NSX) exchanges reflects new market sentiment to invest in Indonesia and in zircon projects. The announcement includes; A) Market capitalisation of the Company will be approximately £358.4m. B) The group was the 2nd largest publicly producing mineral sands company by zircon resources.

Associated Minerals.

PT. Timah Tbk has indicated it has an estimated capacity to recover some 1,000 tpa of monazite by- product from its alluvial tin mining (August 2021). However, the ability to further process monazite to extract thorium and Rare Earth Elements (REEs) is very limited, and controlled by China. Studies and discussion on this matter are ongoing. One separate study suggests Indonesia may have 1.5 billion ton of monazite resources.

PYX shall start production of the associated mineral Rutile in 2022 from its upgraded 24,000 tpa Mandiri Mineral Processing Zircon Plant. Rutile (TiO₂) is used in many industries, including construction, automotive, packaging and electronics.

PT. Kumamba Mining of Papua has an initial resource of 450 million ton of mineral sands with 5% heavy minerals containing zircon, rutile, leucoxene, magnetite, ilmenite and chromite.

In 2014, Trimex Sands of India developed a MOU with the government of Indonesia to look into setting up a US$ 800 million titanium industrial complex. The project was expected to create direct employment for close to 2,000 people and indirect employment for nearly 4,500 people. The first phase of the project was to start by Sept 2011 and end by Dec 2013. Indonesia has large ilmenite resources (about 40 million tons), despite which the country annually imports about 46,000 tons of TiO₂pigment. It would seem this project did not materialize.

Domestic processing.

PT Dian Lestari is the first national manufacturer of Zirconium Silicate, and produces several different zircon products for the domestic market as used in ceramics, foundry, glassmaking etc. The factory was founded in 2005 and located in Cibitung Bekasi. In these facilities, impurities, such as magnetite, ilmenite, rutile and monazite, are separated to ensure a high standard purity of the zircon sand. These installed facilities are capable of producing 10,000 tons per year of zircon sand. The Jakarta grinding plant is capable of producing 450 tons per month of powder zirconium silicate.

PT. Monokem Surya’s factory is located in the Ghajai Center Karawang, West Java. It is a private Indonesian-owned-company specializing in the manufacturing of speciality chemicals for ink, textile, zircon and ilmenite. In 2008, they started with the mining and purification of zircon sand to a purity content of 65 % minimum, then expanded with a product range of zircon flour and micronized zirconium silicate. PT Monokem Surya has a ZrO2+HfO2 processing plant with a capacity of 24,000 tons/year, producing a zircon concentrate ZrO2 content between 65-66 micronized zircon.

Global zircon reserves.

The US Geological Survey estimates global zirconium reserves at 78 million tonne expressed as ZrO2. Major producers include Australia, South Africa, China, Indonesia. In 2018, around 1.2 million ton of zircon was produced globally, while the total global value of traded zircon was USD 2.1 billion. Demand is typically slightly in excess of supply. Historical (2005 to 2016) global exploration expenditure for zircon is around A$20 million per year.

Use of Zircon.

Zircon sand is either used directly in certain applications (e.g., foundry sands) or processed to produce zirconium chemical compounds (e.g., Zirconia) or zirconium metal. Zirconia can also be synthetically produced. Ceramics are by far the largest end-use sector (55%), followed by foundry applications, chemical applications, refractory uses, glass, and other minor applications.

• Foundry industry, used in the form of sand and flour (milled sand) for casting and refractory applications.
• Refractory industry uses include refractory mortar, firebricks or refractory linings for glass and metal furnaces, as well as fibres, nozzles, slide gates, valves and grouts.
• Ceramics industry as a raw material in the production of ceramic bodies, glazes, enamels, frits and pigments applied to traditional ceramics, which includes wall and floor ceramic tiles, porcelain tiles, sanitaryware, washbasins, tableware, special porcelains and industrial tiles, etc, along with a number of advanced ceramic applications.
• Glass sector, where it is increasing finding new global smart glass applications.
• Zirconium metal can be used to form numerous zirconium chemical compounds employed in a wide range of intermediate manufacturing processes and end use applications.
• Gemstone production accounted for almost half of zirconium chemicals market share in 2010.
• Zirconium alloys are widely used in the nuclear industry such as pressure tubes, fuel channels, guide tubes, grid spacers, for fuel cladding, for fuel containers, or even as the core structural materials of water-cooled nuclear reactors.
• Zirconium chemicals are widely used in the paper industry as coatings that add strength and water resistance to paper.
• Zirconium chemicals used as additives in paints and inks to promote adhesion to the substrate and to increase their resistance to heat, scrubbing, water and solvents.
• Zirconium powder is highly flammable and can be easily ignited, with use in the ammunition and explosives industries.
• Getters are zircon materials that can be placed inside a vacuum system to remove small traces of gas from the system through chemical combination or adsorption, gas purification.
• Research into further uses of zirconium include new battery technology and solar cells.

Exploration and production potential in Indonesia.

Developing a list of Indonesian zircon mining company sites, and occurrences is not easy when using free public sources. For example, a 2018 West Kalimantan lists 68 companies targeting zircon in the exploration or production phase. In January 2022 the Mines Department issued a warning that included 31 zircon companies from West Kalimantan, 19 from Central Kalimantan, and 1 from Sulawesi that were in risk of losing their license in February 2022. The ESDM web site “Mining One” shows all of Indonesia’s compliant mining tenements, along with a number of mineral occurrences. A general review of this Mining One site identified two (2) zircon prospects in Banka, 46 locations in West Kalimantan (of which 16 had company tenements), and 10 locations in Central Kalimantan (of which 7 had company tenements). The ESDM One Map included data on resources and reserves. The total Hypothetical resources appear to be 5 million ton, Indicated resources at 88.5 million ton, and Measured resources of 9.5 million ton. The reliability of such resource data is likely to be low. Prospects are listed as being either exploration or production status.

The global production of zircon is often extracted as a by-product or co-product of other mineral sands mining. This means that zircon’s production tends to be influenced by the demand for other minerals contained in heavy mineral sands such as rutile and ilmenite.

PT. Timah Tbk plans to make accessory minerals and REE commodities as a by-product of cassiterite (tin) mineral sands. One 2020 study indicates there is some potential 7 million tons of tailing or by-products of tin mining in the Bangka Belitung Province. The tailing contains various strategic metal-carrying minerals, namely ilmenite (32.43%), zircon (16.65%), cassiterite (12.59%), monazite (11.76%) and xenotime (10.82% of monazite). This program is consistent with several government Regulations [Permen 11/2018, ESDM regulation 25/2018, and MEMR regulation 3/ 2020] that require enhanced value recovery, taking into account the economic value and market needs. PT. Timah Tbk has a 1.5 ton stockpile of tailings and accessory minerals upon which to conduct research on primary mineral extraction, and secondary extraction of selected elements.

Conclusion.

Indonesia has abundant potential resources of zircon mineral sands, along with experienced and responsible companies that are mining, processing and exporting commercial quantities of zircon. The international market for good quality zircon is experiencing great demand and high prices. 

Indonesia is poised to become a significant world player in the zircon market. Unfortunately, the ESDM does not appear to include this zircon industry in many of its publications. The zircon industry has the capacity to support many downstream manufacturing industries.    

It is hoped this article will encourage further investment in the zircon industry.