ROCKHAMPTON-based mining and processing company QMAG has announced a $20 million expansion that will create 50 jobs next year.
QMAG has signed an agreement to buy the mothballed Cement Australia plant near its magnesia processing centre at Parkhurst.
Managing director Alan Roughead said yesterday the investment would add 100,000 tonnes a year to the company’s magnesia production and represented a very efficient use of capital.
Cement Australia ceased production and placed the factory on care and maintenance two years ago.
It’s been idle ever since and will remain un-used for the remainder of the 2011-12 financial year as QMAG develops final plans for recommissioning and operation.
Mr Roughead said the acquisition, refurbishment and recommissioning costs were expected to be $20 million and there would be further investment at the company’s two mines, Kunwarara and Yaamba, to match the increase in production.
“The advantage of the facility not only includes its close proximity to our existing Parkhurst plant, but also the anticipated level of output from a relatively small capital outlay,” he said.
“We believe the incremental output created by this acquisition will be one of the most efficient capital expenditure programs in our industry globally.”
The deal includes the land and all plant and equipment which includes a rotary kiln, bagging plants and storage facilities.
QMAG is forecast to produce more than 300,000 tonnes of calcined, deadburned and fused magnesia at its existing Parkhurst plant in the current financial year, generating revenue of approximately $200 million.
Magnesia is used in the refractory and chemical industries.
- Since 2004 the company has invested more than $100 million
- The Parkhurst magnesia processing plant is one of the largest and most modern in the world with an estimated replacement value of $400 million
- It is owned by RCF, a Denver-based private investment fund
- Latest deal to acquire Cement Australia’s mothballed plant is worth $20 million
- It will allow production to expand by 30% during 2012 and create 50 new jobs
- We believe the incremental output ... will be one of the most efficient capital expenditure programs
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