Molymet submits US$240mn expansion project

Chilean molybdenum and rhenium processor Molymet has submitted an environmental impact assessment (EIA) for the expansion of its Molynor plant in Mejillones, in northern Antofagasta region (II).

Planned investment in the project is US$240mn, to double capacity to just over 100,000t of molybdenum oxide a year, according to documents submitted to the regional environmental evaluation service (SEA).

The project entails installing two additional roasters, as well as a new gas treatment plant, a new sulfuric acid plant and a new molybdenum oxide processing facility. The project also involves expanding the existing desalination plant.

If approved work is expected to start in June 2016 and take approximately two years.

THIRD QUARTER RESULTS

Molymet reported US$17.3mn in third quarter earnings, compared to US$264mn in losses in the year-ago period, despite weaker sales and molybdenum prices.

Net income for January-September was US$27.7mn compared to a loss of US$257mn, the company said in a filing with local securities and insurance regulator SVS.

The company said the volume of molybdenum products sold in the first nine months of the year dropped 7.7% to 131Mt, while average molybdenum prices fell 40.0% to US$7.26/lb.

Molymet said in a separate securities filing that it has begun the process of selling its approximately 18% share in distressed US-based rare earth producer Molycorp.

Molymet said the value of its investment in Molycorp plummeted to just US$3.39mn at end-September from US$599mn in March 2012 when it first acquired a stake in the company.

The US firm has been in chapter 11 brankruptcy since June, following the collapse of rare earth prices.

Molymet is one of the world's largest molybdenum and rhenium processors, with 35% and 70% market shares, respectively.