Latrobe Magnesium Ltd (ASX:LMG, OTC:LTRBF) is on track with its magnesium oxide production strategy, having cash in the bank and with the construction of its stage 1 demonstration plant project now 95% complete.
This strategy will allow Latrobe to initially prove its patented process and generate early revenue with production slated to begin next month.
The magnesium production plant is being developed in the Latrobe Valley of Victoria, Australia, from which Latrobe Magnesium intends to extract and sell magnesium metal and cementitious material from industrial fly ash — currently a waste resource from Yallourn brown coal power generation.
LMG has completed a feasibility study validating its combined hydrometallurgical/thermal reduction process that extracts the metal — a world-first patented extraction process.
The company expects the demonstration plant to begin producing magnesium oxide beginning next month with the full plant to be commissioned by the end of Q2 2024.
Latrobe Magnesium CEO David Paterson said, “Construction is on track for end of March completion with first magnesium oxide planned for April 16. The commissioning team is working hard to make this happen as soon as possible with the operations team ramping up to meet this challenge.”
Progress continues
In an update today, the company confirms that:
- The demonstration plant continues to progress with no reportable health, safety or environmental (HSE) incidents to date;
- Ash handling, process and raw water, potable water and the water treatment plant are complete and operational:
- Commissioning of all other areas is underway in parallel to construction to ensure production can commence in April as planned;
- An operations readiness plan is being actioned.
The site team continues to progress fast-tracking the construction of the plant areas that are required to produce bulk bags of magnesium oxide — an intermediate product — for customer sales, prior to the production of magnesium metal.
Construction and commissioning of the remaining plant areas will be the second phase of the plant to be fully commissioned.
This strategy will demonstrate that the company’s patented, world-first hydromet process can be operated successfully, and prove to all stakeholders the true value of its intellectual property.
Share purchase plan raises $1.93 million
Latrobe Magnesium closed its share purchase plan (SPP) on Friday, raising $1.93 million. A total of 38.6 million shares will be issued under the SPP at $0.05 per share, with the new shares to be issued on Thursday.
The funds raised will be used to fund the cost overrun of the demonstration plant and to ensure that the construction of phase 1 of the demonstration plant will be completed by the end of March 2024 with the production of magnesium oxide to follow by April 16, 2024.
Looking ahead to commercial production
Following the demonstration plant, a commercial plant — with a capacity of more than 10,000 tonnes per annum magnesium — will be developed shortly thereafter with completion targeted for Q1 2026.
The plant will be in the heart of Victoria’s coal power generation precinct, providing immediate access to feedstock, infrastructure and labour.
Latrobe Magnesium plans to sell its 10,000 tonnes per annum of refined magnesium production under long-term contracts to US customers. Currently, Australia imports 100% of the 8,000 tonnes annually consumed.
Adopting the principles of an industrial ecology system, the company highlights that the project is at the forefront of environmental benefit as it will be recycling power plant waste, avoiding landfill and is a low CO2 emitter.
Spray Roaster mechanical and piping complete.
Magnesium oxide Bagging Plant completed.