Latrobe Magnesium Ltd.'s feasibility study for its 3,000-tonne-per-annum magnesium plant in Victoria, Australia, outlined capital costs of A$54 million.
Construction of the 3,000 tpa plant is the third stage in a four-stage project, which will eventually expand to a 40,000 tpa plant.
In its third stage, the plant is expected to generate EBITDA of up to A$5.6 million per annum when it is operating at nameplate capacity and will provide the necessary information for the potential expansion.
Latrobe Magnesium said Sept. 2 it expects to make a final investment decision and start construction of the third stage by December, dependent on securing ash supply for the plant. It inked a memorandum of understanding with EnergyAustralia Yallourn Pty. Ltd. in January 2018 whereby the latter's Yallourn power station in Victoria would supply fly ash to the magnesium plant.
Ash from the Yallourn landfill is enough for over 10 years' production at 40,000 tpa, according to the release.
The company said it will submit an advanced finding application in October to cover costs of the initial plant and its activities, and may receive as much as A$28 million of project funding from the government under a cash rebate.
Latrobe Magnesium will also approach the Commonwealth and Victorian governments to receive funding of up to A$12 million, it noted.
The remaining funds of about A$16 million will be raised by a mix of exclusivity payments and equity.
