Latrobe Magnesium Ltd (ASX:LMG, OTC:LTRBF) has moved to fund any cost overrun for the first stage of its magnesium oxide demonstration plant with a share purchase plan (SPP), aiming to raise $3 million before costs.
The company says it received several calls from shareholders who were unable to participate in previous placements but expressed willingness to subscribe in future raisings, prompting it to open the SPP.
The SPP will open February 26, at an issue price of $0.05 per share – eligible shareholders can apply for up to $20,000 worth in issued capital each without incurring brokerage fees, commission or other transaction costs.
The capital raise will function on a first come, first served basis and the directors reserve the right to close the SPP once $3 million has been raised.
Magnesium demonstration plant
LMG is constructing a 1,000-tonne per annum demonstration magnesium production plant in Victoria, expected to begin production this year.
The company has developed a patented extraction process to remove magnesium from waste resource like fly ash produced from brown coal power plants.
The process – which LMG describes as ‘low emission’ – also produces other products like supplementary cementitious material (SCM), silica and iron oxide using almost 100% of the fly ash resource.
Once the demonstration plant has been successfully commissioned, Latrobe will construct a 10,000-tonne per annum commercial production facility, at a time when global demand for magnesium is reaching one million tonnes per annum and is projected to double in the next few years.