EV Resources Secures Tecomatlán Antimony Plant Feedstock Via Four Mexico MOUs

EV Resources Secures Tecomatlán Antimony Plant Feedstock Through Four Mexico MOUs

EV Resources Limited (ASX: EVR) has executed four non-binding Memorandums of Understanding (MOUs) with regional antimony ore suppliers across Mexico, potentially securing 2,330–2,430 tonnes per month (tpm) of feedstock. This represents 50%–60% of the Tecomatlán Processing Plant's nameplate capacity and marks a significant milestone in the company's transition from developer to near-term producer. EV Resources secures Tecomatlán antimony plant feedstock through four Mexico MOUs, positioning itself as a capital-efficient operator in a constrained global supply environment.

Four MOUs Create Diversified Supply Pipeline

The four MOUs span suppliers across the Mexican states of Guerrero and Puebla, with ore grades consistently in the high-grade range. The supply profile reflects both volume and quality diversification:

All four suppliers are currently producing high-grade direct shipping material from active operations. Consequently, the feedstock represents real, near-term commercial opportunities rather than speculative supply.

"Establishing a pipeline of over 50% of the Tecomatlán Plant's feedstock capacity through these four regional MOUs is a major de-risking milestone for EVR as we target a transition from developer to producer."

— Mike Brown, Managing Director, EV Resources

The Hub-and-Spoke Model: Mutual Commercial Logic

EVR's approach centres on the commercial logic underpinning the hub-and-spoke model, which benefits both the company and its ore suppliers. Regional antimony miners in Guerrero, Oaxaca, and Puebla currently face significant logistical challenges, with the nearest smelters capable of processing their ore located up to 1,200km away. These transport costs substantially impact margins for smaller operations producing high-grade material.

Tecomatlán alters this equation by positioning the plant as a centralised regional processing hub. EVR can offer miners dramatically shorter transport distances, with some suppliers located less than 130km away, alongside a consistent, local buyer for direct shipping ore within a commercially structured framework.

In return, EVR gains access to a diversified, multi-source feedstock pipeline without the capital intensity of operating its own mine initially. This represents a low-CAPEX path to production that monetises existing regional ore supply.

Understanding the Hub-and-Spoke Processing Model

The hub-and-spoke concept represents a centralised processing facility (the "hub") sourcing raw ore from multiple smaller, satellite mining operations (the "spokes"). Rather than each mine building its own processing infrastructure, they collectively feed a single, more efficient plant.

Key Benefits for EVR

• Lower capital requirements: Processing ore already being extracted without funding mine development
• Supply diversification: Multiple feedstock sources reduce single supplier disruption risk
• Scalability: Additional MOUs and plant ramp-up enable throughput growth without proportional increases in fixed costs
• Mutual value creation: Suppliers benefit from proximity and reliable offtake; EVR benefits from feedstock without mine-level CAPEX

Technical Terms Explained

• MOU (Memorandum of Understanding): A non-binding commercial agreement establishing intent and key terms between parties, subject to finalisation into definitive contracts
• Nameplate Capacity: The maximum designed throughput of a processing facility under standard operating conditions
• Direct Shipping Ore (DSO): High-grade ore that can be sold or delivered without requiring complex beneficiation
• Sb: Chemical symbol for antimony
• Gravity Concentrator: A processing system separating minerals based on density differences using low-energy, low-cost methods suitable for antimony ore

High-Grade Stockpile Opportunity Supports Early Production

A standout commercial opportunity has emerged from the MOU network. The anchor supplier providing up to ~2,000 tpm at ~5% Sb, located just 8km from the plant, has indicated willingness to sell a stockpile of 400 tonnes grading 16% Sb. EVR is evaluating this high-grade material, which could provide immediate feedstock ahead of first production.

This opportunity represents several compelling advantages:

• Immediate, high-grade feedstock available prior to day-one commissioning
• Early revenue potential from processing premium-grade ore from the outset
• A strong first concentrate batch to demonstrate plant performance to potential offtake partners

Commissioning Progress on Track for 2H 2026 Production

The Tecomatlán Plant has reached key operational milestones, with dry commissioning of the grinding circuit now complete. The facility requires no additional permitting for Phase 1 operations, positioning the company for commissioning and sustainable operation utilising third-party ore feedstock.

Current Operational Status

• Grinding circuit dry commissioning: ✅ Complete
• Phase 1 two-stage gravity concentrator circuit: Designed to handle mixed-state material
• Metallurgical recoveries: 90.8% achieved to date
• Concentrate grades: 22%–36% Sb demonstrated
• First antimony concentrate production: Targeted for 2H CY2026

The company is conducting 3rd stage cleaning optimisation test work, assessing whether additional processing steps such as shaker tables could improve concentrate grades beyond the current 22%–36% Sb range. Higher-grade concentrates would improve marketability and pricing under future offtake arrangements, including an existing MOU with Wogen/XCLRI for concentrate sales.

Commercial Framework Established for Future Contracts

The MOUs establish a framework for future definitive purchase contracts, specifying that material is to be delivered at approximately 150mm particle size to the Tecomatlán plant. Furthermore, they define two potential feedstock qualities: low-grade material (5%–29% Sb) and high-grade material (>30% Sb).

Key commercial variables are established for pricing, including grade, water content, impurity and deleterious mineral content, recovery, transport and logistics cost. EVR is currently undertaking metallurgical recoveries on representative samples from each operation to establish likely plant performance and concentrate characterisation.

Near-Term Operational Roadmap

EVR has outlined defined operational next steps, with several items already underway or expected shortly:

A fifth MOU is described as being in advanced negotiations, with EVR expressing confidence it will be finalised shortly. Additional feedstock opportunities have been identified in Oaxaca, which could materially increase total throughput volume beyond current MOU coverage.

Strategic Context: North American Antimony Supply Constraints

EVR is targeting near-term North American antimony production during a period of acute global supply constraints. Antimony is a designated critical mineral by the US, EU, and Australia, with applications spanning energy storage, battery technology, defence, and high-tech manufacturing.

The company's approach addresses supply chain constraints through the Tecomatlán Plant's low-CAPEX production pathway and the Los Lirios Antimony Project's potential to provide a high-grade resource base for increasing both antimony production and longer-term supply.

Asset Portfolio Provides Long-Term Growth Pathway

While near-term focus centres on Tecomatlán as a third-party processing hub, EVR's broader asset base provides longer-term growth options:

Los Lirios represents particular significance, with first-pass drilling confirming a laterally extensive carbonate replacement system (CRD) and work toward a maiden JORC Resource underway. If developed, Los Lirios would eventually feed the Tecomatlán plant with own-source ore, transforming the company from a toll processor into a vertically integrated antimony producer.

Investment Implications: Capital-Efficient Path to Cash Flow

EVR's execution represents a clearly defined, capital-efficient strategy during constrained antimony supply conditions. Specifically, the company has:

• Completed dry commissioning of the grinding circuit
• Signed four feedstock MOUs covering 50%–60% of plant capacity
• Identified high-grade stockpile opportunities for early commissioning
• Commenced optimisation test work to improve concentrate grades
• Established a concrete roadmap with 2H 2026 production targeting

The hub-and-spoke model is structured to generate cash flow with minimal upfront capital requirements. Moreover, EV Resources secures Tecomatlán antimony plant feedstock through four Mexico MOUs in a way that addresses regional miners' logistical challenges whilst providing the company with diversified feedstock supply.

Key Investment Considerations: EVR has established a credible near-term antimony production pathway in North America through its low-CAPEX hub-and-spoke processing strategy. With 50%–60% of plant feedstock capacity secured and first concentrate production targeted for 2H CY2026, the company is well positioned for its transition from developer to producer during a period of acute global antimony supply constraints.

Note: The MOUs described are non-binding except for customary confidentiality and compliance clauses. They do not create legally binding purchase or sale obligations, and there can be no assurance that definitive contracts will be executed. Ore grades referenced reflect commercial target specifications declared by respective counterparties and have not been independently verified by a Competent Person under the JORC Code (2012).

Ready to Learn More About EV Resources' Antimony Production Strategy?

EV Resources (ASX: EVR) is executing a capital-efficient, hub-and-spoke processing strategy at its Tecomatlán Plant in Mexico, with over 50% of feedstock capacity now secured and first antimony concentrate production targeted for 2H CY2026. For investors seeking exposure to a near-term North American antimony producer during a period of acute global supply constraints, visit evresources.com.au to explore the company's projects, milestones, and investment case in full.