Resource World Magazine

48 www.resourceworld.com f e b r u a r y / m a r c h 2 0 1 6 W hile some metals have seen a decline in demand in recent years, the opposite is true for the light- weight metal magnesium and for good reasons. The silvery metal is one-third the weight of steel yet it provides the same structural strength; it is a necessary element to alloy with aluminum to strengthen that metal and it is increasingly used to reduce weight in vehicles and aircraft. Weight reduction results in increased fuel efficiency and decreased greenhouse gas emissions. In addition, by adding magnesium during steel making, the steel is 'purified' by eliminating sulphur and it is strengthened. Magnesium is increasingly used in cameras, computers and cell phones as the metal is the structural skeleton of these devices. Noting global magnesium demand has grown from 389,000 tonnes/year in 1998 to 910,000 tonnes/year in 2013, Nevada clean magnesium inc. [NVM-TSXV; MLYFF-OTC; M1V-FSE] is positioning itself to become a major US producer and distributor of primary, high-grade, low cost magnesium metal extracted from its 100%-owned, road-accessible, Tami-Mosi property near Ely, north-central Nevada. An independent NI 43-101 compliant Preliminary Economic Assessment has been completed by Wardrop Engineering. Inferred resources stand at 412 million tonnes averaging 12.3% magnesium for a contained metal content totaling 111 bil- lion lbs of magnesium using a 12% cut-off grade within high-purity dolomite, the host rock of magnesium. The PEA demonstrated a conservative business model with a NPV (6% discount rate) of US $547 million, an IRR of 16.1%, and a payback time of 5.9 years with an initial capital cost of US $424 million. This is based on one cycle per day for 30 years of mining producing 30,000 tonnes of 99.9% magnesium per year. Cash cost/lb of magnesium is projected to be US $1.28/ lb. Nevada Clean would be selling magne- sium in the range of US $1.65-$1.90/lb. The company has engaged Lindon Acres Enterprises to build a bench-scale pilot furnace in Fort St. John, British Columbia. To be completed shortly, the furnace is designed to hold about 10 lbs of dolime-ferro-silicon and is expected to yield a magnesium 'crown' of 1 lb. Bench- scale testing will identify and correct any potential design flaws before construction of the commercial-scale pilot furnace in Norway. The testing program will com- mence early in the New Year. Meanwhile, these efforts are coinciding with the completion of the materials test- ing program under way at the Mo Riana Labratory in Norway under the super- vision of ScanMag AS. The ore testing program is using a Thermo Gravimetric Analyzer and will include confirmation testing of dolomite from the ScanMag ore- body as well as the assessment of potential reductants. Ore from the Tami Mosi deposit will also be tested. Success of these tests will lead to designing and develop- ment of the pilot program using multiple pilot furnaces to operate at a small produc- tion level. The pilot-scale facility will be capable of incrementally bringing addi- tional equipment on line. This will allow the plant to ramp up to full-scale produc- tion as the market utilizes the metal. The technology that will be utilized to recover magnesium – the thermal reduc- tion process – was originally developed in Italy in the 1930s (the Bolzano process) that became well known as the magnesium alloy was used to make the very successful air-cooled Volkswagen and early Porsche engines. This technology has been used for the past 38 years in Brazil utilizing two cycles per day and is noted as being both competitive and environmentally sound, providing magnesium metal for its domes- tic demand. Ed Lee, CEO for NCM explains, "We are obviously pleased the development work has started and is definitely a posi- tive for the shareholders of Nevada Clean Magnesium. The process and the equip- ment that are being developed and installed at ScanMag will be directly uti- lized at the Tami Mosi Project. By having the comfortable and stable relationship with ScanMag, it offers us the chance to address and eliminate the technical process risks typically inherent with new operat- ing projects. "We are concurrently raising monies for the Tami Mosi Project because the timing is right for magnesium metal production, especially if it can happen within the US. The metal has a bright future with more opportunities than ever before. In the energy sector there is a drive to replace the $10 billion lithium battery market with magnesium as a more efficient and environmentally friendly alternative for batteries for electric cars and dry cell applications." Magnesium is more readily available than lithium and, for the same size battery; there is twice the current capacity. Magnesium demand is strong with the auto sector needing seven times annual production. A North American source will benefit domestic buyers; however, there would be other benefits from magnesium production, including the production of three forms of energy: electricity, syngas (coal gas) and high pressure steam. As well, most waste can be converted to potential products and CO 2 waste can be captured. Jim Sever, President/COO, said, "There are two types of markets: push and pull. In Nevada Clean Magnesium builds bench-scale pilot furnace by Ellsworth Dickson mINING

• Cover