Latrobe Magnesium advances Victorian demonstration plant with key upgrades and readiness plan
Engineering and construction work at Latrobe Magnesium’s (ASX: LMG) demonstration plant project in Victoria has focused on minor Stage 1A upgrades observed during the commissioning trial to improve plant operability and efficiency.
The Stage 1A modifications were carried out alongside limited construction for Stage 1B during the quarter to maintain continuity and experience within the site team.
Civil works were ongoing to advance structural, mechanical and piping foundations to house critical equipment for briquette production, which will be used in the downstream thermal reduction process.
Comprehensive upgrade
Upgrade work during the three months to September included lighting, insulation, paint and coating on the plant’s spray roaster, new recycle and bypass piping to improve process efficiency and updates to process control software to accommodate system modifications.
The period also saw the installation of surplus capacity hydromet tanks to better manage process upsets, along with additional instrumentation including flowmeters, vibrators, closed-circuit TV and control valves to enhance operational control and additional concrete works to prevent the contamination of fly ash feedstock during operations.
Key equipment such as the briquette machine, ball mill, conveyors and dust collectors were positioned on site, with additional equipment in transit and expected to arrive by the month’s end.
Readiness plan
Latrobe’s operations readiness plan was put in place alongside the Stage 1A work.
Due to a revised strategy of developing the demonstration plant in stages to manage cash flow, the company decided to recommission the plant to produce magnesium oxide during the construction of Stage 1B.
The plant was designed to break even once Latrobe achieved commercial quantities of magnesium metal production but, to avoid substantial cash loss in the interim, the plant will be operated for a few months to achieve certain goals.
These include further improvements to magnesium oxide specification, production of secondary products for customer verification and future test work for a Stage 2 commercial flowsheet and the generation of sufficient data to demonstrate actual performance against modelled emissions to enable permitting activities for the Stage 2 plant.
Stage 2 study
Latrobe worked closely during the quarter with engineering firm Bechtel Australia to finalise a cost and scope proposal for a feasibility study into into a 10,000-tonne-per-annum Stage 2 commercial magnesium production plant in the Latrobe Valley.
The proposal is believed to strike a balance between front-end loading and study costs and is designed to position the project for a smooth transition to the final investment decision.
Bechtel also commenced the development of a preliminary layout for Stage 2 as part of the feasibility study early works.
The study and any additional test work for the Stage 2 plant will be funded by the sale and leaseback (or other financing proposal) of Latrobe’s 0.11-square-kilometre Tramway Road site, originally purchased in 2021 to house the demonstration plant.
International plant
Latrobe is progressing a proposed 100,000-tpa Stage 3 magnesium plant in Malaysia through its subsidiary Latrobe Magnesium Sarawak.
Company executives travelled to the site in September to meet with officials from the Sarawak Ministry of International Trade, Industry and Investment, power utility Sarawak Energy Berhad and foreign investment entity Invest Sarawak.
The allocation of electrical power by the Sarawak Power Planning and Coordination Committee is critical to the project and key terms of a power purchase agreement will need to be agreed upon before the next phase of work can commence.
In August, Latrobe Magnesium Sarawak sought approval from the Malaysian government to import ferronickel slag, which will be the primary feed material for the proposed plant.