Latrobe Magnesium Ltd (ASX:LMG) continues to make progress with construction of its Stage 1 Demonstration Plant in Victoria's Latrobe Valley which will produce magnesium metal and cementitious material from industrial fly ash, which is currently a waste resource from brown coal power generation.
Although there have been some delays caused by a severe shortage of labour in the construction industry, particularly in Victoria, the plant continues to progress with no health, safety or environmental incidents to date.
The construction project team remains confident that the 1,000 tonnes per annum plant will be commissioned by the end of 2023.
Latrobe Magnesium strategy
Latrobe Magnesium is developing a magnesium production plant using its world-first patented extraction process on the waste industrial fly ash from the Yallourn Power Station.
LMG intends to extract and sell magnesium metal and cementitious material and has completed a feasibility study validating its combined hydrometallurgical/thermal reduction process that extracts the metal.
A commercial plant will then be developed shortly thereafter with a capacity of +10,000 tonnes per annum magnesium.
Further plant capacity expansion will be determined once Geotech works have been completed on the existing landfill at Yallourn due for completion by the end of 2023.
The plant will be in the heart of Victoria’s coal power generation precinct, providing immediate access to feedstock, infrastructure and labour.
READ: Latrobe Magnesium will use $4.2 million from placement to operate demonstration plant
Project update
In a project update, LMG said that the majority of the equipment packages had arrived on-site during the last few months.
Among the equipment that has arrived as engineers from Mincore close-out vendor packages and the site team unloads and places equipment position onsite includes vacuum pumps, reduction furnace, cooling tower, retort tubes, steam boiler, the materials & bulk handling system, scrubber, reverse osmosis (RO) plant and the SCM silo.
Other equipment includes process pumps, agitators, cable ladders and trays, dust collectors, screw conveyor, instrumentation, non-metallic tanks, motor control centres (MCCs), spray roaster plant equipment and PCS hardware.
SCM silo & RO plant.
A total of $17.5 million has been committed to more than 35 suppliers around the world and 103 TEU (Twenty-foot Equivalent Units) of equipment and 138 tonnes of freight have been moved onto site, including components related to critical long lead equipment which achieved targeted delivery schedule.
Civil works
The two major civil works packages at the construction site have been completed by local supplier Stirloch and these constitute more than 90% of the Demonstration Plant's civil requirements.
Construction work continues to progress as structural steel for the spray roaster is erected.
Mincore's site team is working diligently to ensure the safe and efficient installation of all components of the Demonstration Plant.
Spray roaster structural steel erection.
Further sources
The progress comes as LMG continues to assess further stages of its production plan as well as the use of material from additional fly ash sources.
The latter includes an alternative solution to a proposal to turn the Hazelwood mine pit to an artificial ‘pit lake’.
LMG has successfully tested converting Hazelwood fly ash waste feedstock into magnesium metal, a critical metal, and valuable by-products, which validates this sustainable alternative.
Larger plant
It is also progressing plans for a much larger +10,000 tonnes per annum commercial plant, which are expected to be finalised within six months.
The current plant size is set at 10,000 tonnes, based on the ash supply generated from Yallourn until its closure in 2028. This supply of ash feedstock alone can operate a 10,000-tonne plant for 20 years.
There is substantially more ash supply available than what will be generated and work undertaken by GHD will determine the amount of ash that can be economically extracted, to then determine the optimum size and mine life for the project, potentially beyond 10,000 tonnes.
Following the assessment of the expanded plant's size, LMG will conduct a feasibility study using real data from the demonstration plant. This bankable study is planned for the first half of 2024.
The projected timeline for operating the commercial plant is set for June 2025, contingent on timely approval processes from the Victorian Government.
Malaysian facility
LMG also is progressing a Stage 3, 100,000 tonnes per annum proposed for Samalaju, in the Sarawak state of Malaysia.
READ: Latrobe Magnesium locks in Sarawak, Malaysia, for 100,000 tonnes per annum plant with net-zero potential
The company is engaged in discussions with various international investors regarding potential joint venture participation in the Stage 3 project and anticipates signing non-binding MoUs with potential equity partners by the end of this year.
Critical metals focus
These stages of developing the company’s strategy come during increased global focus on critical metals, including magnesium, which are needed to drive the growing momentum for cleaner, greener energy, including electric vehicles.
The supply risk of magnesium as a critical metal.
The US Department of Energy (DoE) recently released its new critical metals assessments, which highlight the supply risk of magnesium and its importance in energy as the world seeks to decarbonise and shift towards green energy.
Latrobe Magnesium aims to ensure the supply of magnesium for the short, medium and long term with its projects in Australia and Malaysia.