Latrobe Magnesium Advances Stage 1 Demonstration Plant Toward Full Operational Capacity
- 24-Jun-2024 8:38 PM
- Journalist: Emilia Jackson
Latrobe Magnesium Ltd (ASX:LMG, OTC:LTRBF) continues to advance with its initial demonstration magnesium plant at Hazelwood North in Victoria's Latrobe Valley, located 150 kilometers southeast of Melbourne, Australia.
LMG has pioneered a patented method for extracting magnesium metal from magnesium-rich resources. This innovative process involves extracting magnesium metal from fly ash through a groundbreaking hydrometallurgical extraction and thermal reduction process. This approach not only produces valuable by-products but also minimizes waste streams, offering a more sustainable solution.
The company's stage 1 demonstration plant project is advancing smoothly, with no reported health, safety, or environmental (HSE) incidents thus far. During the commissioning trial, the project successfully produced magnesium oxide (MgO) that met the required quality standards.
After completing a successful commissioning trial and completing major construction for MgO production, the demonstration plant will now move forward to continuously produce MgO.
Detailed planning efforts are ongoing to finalize the construction and commissioning of the demonstration plant before commencing magnesium metal production. LMG anticipates revenue from sales to commence in the near future.
The MgO produced during the ore commissioning trial exhibited purity levels exceeding 80%. LMG views this outcome positively and considers it in line with expectations, especially considering the spray roaster was processing a magnesium solution of lower concentration.
This result gives the commissioning team considerable confidence that the Spray Roaster will produce even higher-quality MgO during its operational phase.
Moving forward to stage 2, the commercial plant aims to produce over 10,000 tonnes annually, leveraging cutting-edge technology and streamlined materials handling processes. This strategic approach positions LMG to achieve cost competitiveness on a global scale.
As of now, the annual demand for magnesium stands at around one million tonnes, and experts anticipate this figure to double in the coming years.
The stage 2 commercial plant is currently prioritizing site selection and designing vertical retort furnaces. LMG maintains a robust financial position, bolstered by the recent $12 million placement and an additional $6 million expected from its underwritten rights issue, currently available to shareholders.
LMG has highlighted that it successfully reduced its existing debt by $12.9 million following the receipt of its ATO R&D rebate in May 2024.
Currently, the company is exploring various funding options for its stage 2 and stage 3 projects. These include potentially selling a portion of its site land and engaging in a sale and leaseback arrangement for the demonstration plant site, aiming to raise up to $15 million.