Australia’s Latrobe Magnesium (LMG) has commissioned global engineering, construction and project management company Bechtel to carry out a pre-feasibility study (PFS) for a 100,000-ton-per-year magnesium metal project. Following the completion of the PFS, Latrobe Magnesium will hold discussions with potential joint venture partners wishing to participate in its projects.
PFS will evaluate strategic options to utilize and develop a 100,000 t/y magnesium plant located overseas.
The project is expected to generate approximately $1 billion in revenue, with an estimated EBITDA of approximately $600 million, while achieving net zero CO2 emissions using Latrobe Magnesium’s proprietary technology and renewable energy.
Latrobe Magnesium has reached a definitive agreement with a ferronickel producer for the supply of ferronickel slag for the project over the next 20 years. Latrobe Magnesium expects to sign a binding memorandum of understanding with the supplier in July 2022. The parties have reached an agreement on key terms and conditions and are currently awaiting board approval.
The research was conducted by Bechtel, a world-renowned engineering, construction and project management company. Bechtel will conduct a two-part study, first evaluating strategic investment options to maximize value, and then further identifying the selected options to assist Latrobe Magnesium in developing the business case and developing for the Feasibility Study (FS) phase Work Plan.
At the end of 2022, Latrobe Magnesium will disclose the PFS to potential joint venture partners to confirm their interest in participating in the project.
Latrobe Magnesium has appointed Jasper Consult DMMC as a facilitator to find suitable potential partners for the project. DMMC is an international consulting firm based in London and Dubai.
Bechtel is a global engineering, construction and project management company with over 70 years of experience in mining, metals and minerals processing, involved in more than 160 major projects and 1,300 studies in various sectors of the ferrous, non-ferrous, precious and energy minerals industries aspect. In the past 10 years alone, Bechtel’s mining and metals global business unit has completed over 60 PFS/FS studies and over 30 EPC/EPCM projects worldwide.
Bechtel’s global project delivery expertise will bring tangible benefits to PFS and support the decision-making process for strategic options. Bechtel’s extensive experience delivering projects globally has enabled it to forge long-term partnerships in supply chain and industry synergies to support Latrobe Magnesium and its magnesium projects.
Latrobe Magnesium is forming a magnesium production project in Victoria’s Latrobe Valley using a proprietary extraction process. Latrobe Magnesium intends to extract and sell magnesium metal and cementitious materials from industrial fly ash, which is currently a waste resource from the Yallourn lignite power plant. Latrobe Magnesium has completed a feasibility study demonstrating the feasibility of its hydrometallurgical/thermal reduction process to extract metallic magnesium. Construction has begun on the initial 1,000-tonne-per-year magnesium plant, which is expected to be operational by the end of the first quarter of 2023. Soon, a commercial plant will be built with an annual capacity of 10,000 tons of magnesium. Once the 10,000 tpa capacity is operational, further expansion of the plant will be considered. The plant will be at the heart of Victoria’s coal power generation region, with immediate access to feedstock, infrastructure and labour. Latrobe Magnesium plans to sell refined magnesium to US and Japanese customers under long-term contracts.