China Magnesium’s USD1.5bn.Plan to Build the World’s Largest Magnesium Base

According to Zhang Bo, Vice Secretary-General of Haicheng in Liaoning Province, Haicheng is about to embrace a USD1.5 billion magnesium investment from China Magnesium Corporation Ltd - the world’s largest.

With the most abundant magnesium resources in the world, Haicheng in Liaoning Province accounts for about 70% of China’s total and approximately 70% of the world’s total.“We’ve been following this project for nearly 10 years, and have recently decided on its launch. An investment of USD1.5 billion is planned over the next 3 - 5 years to result in an annual capacity of 200,000 tons of magnesium”, Zhang said.

In 2008, domestic magnesium output was 630,000 tons, 85% of the world’s total, and 70% of this was produced in Shanxi Province.“Dolomite and pidgeon processes have been used in magnesium production in Shanxi, different from the magnesite and electrolytic processes used in Liaoning. We are paying close attention to the interaction between these two processes and materials, as they certainly advance the use of magnesium. However, the development of the electrolytic process is still a problem.” Dong Chunming, Chief Editor of China Magnesium Web, said.

Anshan in Haicheng City has the most abundant magnesium resources in the world. With approximately 3 billion tons of verified reserves, Haicheng accounts for 80% of China’s total and 20% of global supply. Characterized by its high quality, low depth and easy exploitation, most ores are 45%-47.5%, making it the best magnesium mining area in the world.“We hope to convert the abundance of resources into economic benefits through this project.” Zhang said.

As early as 8-9 years ago, Haicheng considered the development and application of local magnesium resources, later contacting the Chinese Academy of Sciences and the China Magnesium Corporation Ltd. (CMC) for advice on technical and economic issues. “The project was finally decided upon this year, with various factors taken into consideration”, says a source from the Foreign Economic Commission of Haicheng.

CMC, involved in the previous development of magnesite, registered two companies, namely Magnesium Alloy and Magnesium, in Haicheng. The construction of a 200,000-ton magnesium alloy and a 50,000-ton magnesium project are consequently planned.“Land for construction has been arranged in the Haicheng Development Zone and in Pailou Town, at which pre-construction preparation is currently under way. Phase I will be completed and opened in the summer of 2010”, Zhang said.

Besides, we have learned that CMC has invested USD7.5 million in this project, with CMC set to register two new companies. Insiders say other domestic companies will be involved in part of the project, but Zhang asserts,“we haven’t considered outside investment.”