Latrobe Magnesium Ltd (ASX:LMG, OTC:LTRBF) has achieved a world first with the production of magnesium oxide (MgO) from brown coal fly ash waste at the first phase of its 1,000 tonnes per annum Stage 1 Demonstration Plant in the Latrobe Valley of Victoria.
In producing the world’s first environmentally sustainable MgO from fly ash, the company also becomes the only new magnesium producer in the western world since 2015 and this has been achieved by emitting 60% less CO2 than the industry average.
Patented extraction process
This comes after the company completed commissioning of Stage 1 Demonstration Plant utilising its patented, sustainable hydromet magnesium extraction process at an industrial scale.
It demonstrates the significant value of LMG’s intellectual property with the method processing 100% of the waste fly ash feed material to produce five valuable byproducts with no further downstream waste or tailings.
Investors have welcomed the milestone with LMG shares as much as 37.26% higher in ASX trading this morning to A$0.07.
Magnesium is classified as a critical mineral in multiple countries, with no current producers across Japan, North America, Europe and the Middle East.
Demand for magnesium, particularly ex-China, is expected to grow strongly in the coming years with a significant portion of this demand expected from the automotive sector.
Latrobe Magnesium CEO David Paterson said: “We are incredibly proud of the results from our Demonstration Plant and the achievement of MgO production.
“The world’s first flow sheet using a hydromet process is a testament to our technology, our staff and contractors involved in the process to date.
“Globally significant”
“As the only new Western producer, the importance of Latrobe Magnesium’s production is globally significant, and this achievement validates our patented hydrometallurgical technology and years of research and development to get to this stage.
"I would also like to take this opportunity to thank all the aforementioned employees and contractors, who have worked tirelessly to make this achievement possible and look forward to our continued success.”
Demonstration Plant’s Spray Roaster operating.
MgO production from the Demonstration Plant will be sold to Rainstorm Dust Control Pty Ltd in accordance with the MoU between the parties and a saleable magnesium metal is expected to be produced in the coming months.
About the technology
LMG’s patented hydrometallurgical extraction/thermal reduction technology is the only process capable of extracting magnesium from brown coal fly ash and ferro-nickel slag tailing feedstocks.
Converting nearly 100% of this unwanted waste resource into saleable products, this low-emission process produces magnesium metal with accompanying valuable secondary products at no incremental cost and these are expected to account for ~25% revenue, including:
- Magnesium oxide;
- Supplementary cementitious material (SCM);
- Silica;
- Char;
- Iron oxide; and
- Agricultural lime (calcium carbonate).
This patented process not only reduces the operating cost of traditional magnesium and cement production methods but simultaneously reduces carbon emissions by as much as 60% compared to the industry average.
The process produces no further downstream tailings, ensuring environmental sustainability.
Planning for Stage 2
Following this achievement and validation of the hydromet process, LMG can now begin a bankable feasibility study and financing discussions, in relation to the 100%-contracted, 10,000 tonnes per annum Stage 2 Commercial Plant.
The Commercial Plant is to be constructed using similar engineering as the Demonstration Plant and although equipment will be larger scale, the scale required is not proportionate to the 10 times greater annual production of the Commercial Plant and will be significantly relatively less capital intensive.
The Demonstration Plant was constructed by several local contractors, including Mechanical Maintenance Solutions Pty Ltd (structural, mechanical and piping services), O&M Pty Ltd (electrical and instrumentation services) and Stirloch Constructions Pty Ltd (civil and earthworks services).
These three contractors, amongst other vendors and suppliers being Tenova, Steuler-KCH Australia Pty Ltd, Fast Automation Pty Ltd, Coregas Australia, Stable Engineering, Custom Agency Services Pty Ltd and Rockwell Australia Pty Ltd, are formative of LMG’s Strategic Supplier Program (SPP) for the Commercial Plant.
The SPP will provide greater certainty of cost input and fast-track information utilised in the feasibility study, which will inform the final investment decision at calendar year’s end.