As the world’s demand for minerals increases we are hearing more whacky ways of obtaining minerals.

Last month one mining director suggested we could obtain lithium from sea water. Now, another director is not only suggesting we can obtain magnesium from fly ash but that his company is ready to build a purpose-built plant for this.

The Gippsland region is synonymous with coal, being home to the Hazelwood coal plant which shut in 2017. But Latrobe Magnesium (ASX:LMG) wants to open a plant which generates magnesium from the fly ash of coal plants.

Yesterday it revealed its feasibility study and it expects construction to start on a plant in December and be complete in 2021.

CEO David Paterson spoke with Stockhead and said this was the “first step in the 1000 mile journey”.

He noted this was a long time coming, particularly with the closing down of Hazelwood. The continued operations had previously been factored into the company’s plans.

Obtaining magnesium from fly ash is done in a unique process that involves using hydrochloric acid to dissolve the mineral and treat it in a spray roaster.

The process ultimately results in less CO2 emissions and means the final product will be in Paterson’s words “green magnesium”.

But not only can you obtain magnesium from fly ash, you can also get it from cement too, and the latter is green as well.

“I suppose the beauty of our process is we have calcium oxides,” Paterson said. “Usually when you’re making cement you start with carbonates and limestones and have to drive off those CO2s.

“With cement, because we start with [calcium oxides] we have low emissions, its 60 per cent lower than you’d make [with carbonates and limestones].”


The plant will ultimately cost $54m and produce 40,000 tonnes per annum. But estimates suggest it will bring back $5.6m per annum in earnings.

Latrobe Magnesium has a distribution agreement with America’s Metal Exchange Corporation and a similarly-intended MOU with Japan’s Advanced Material Corporation.

Paterson was bullish about the prospects of Latrobe and the broader magnesium market.

He noted magnesium’s lighter weight made it more attractive as a metal in iPhones and electric vehicles.

“If you make a lighter car, it will allow it to go further,” he said.

“Magnesium is 25 per cent the weight of steel and its two to three times stronger even though it appears like chalk.”

Jobs and growth

Victoria has been accused of being anti-mining, with moves like the hike in gold royalties and the ban on gas fracking not working to dispel that view.

The latter notably hit Australian mining magnate Gina Rinehart, who invested in a company hit by Victoria’s fracking ban.

Paterson told Stockhead he was not concerned, noting the government was concerned about unemployment in the valley.

Within this context Latrobe is part of the solution; it will directly employ 374 people and indirectly thousands more.

“We bring a lot to the valley not just in people employed,” he said. “Its all the other things we do that makes a rail-hub work, it adds to freight going in and out of the valley.

“Maintenance alone is a $30m business, so not just employment but other business activity.”