tropic, thanks for the info. Since I'm a new LMG shareholder I obviously have a lot to catch up on and its always helpful when another shareholder like yourself is gracious enough to assist.
I agree with your thought about Europe preferring to buy from other countries rather than China, partly due to have more competition in the market place. However at this stage there is almost no other magnesium available outside China.
Power costs in China are cheap and range from US$0.05/kWh to US$0.08/kWh depending on the region and the mode of production. Sarawak is one of the few places in the world that has cheap 24/7/365 power due to their large hydro dams.
From my perspective LMG needs power for the 1,000 tonne demo plant and 10,000 tonne production plant in Victoria, if power cost for LMG in Victoria is above US$0.12/kWh then I'd doubt whether LMG will be competitive vs. China even if the fly ash is free.
The current magnesium ingot price is US$3,100/t FOB China.
IF LMG needs 65% of the usual power requirement ie 40,000kWh x 65% = 26,000kWh .
Total power cost for LMG = 26,000kWh x US$0.12 = US$3,120/tonne for power only. LOSS making
Will need to closely watch the demo plant for power usage.
I know from my knowledge of OM Holdings that in Sarawak their cost would be US$884/tonne.
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