Clean energy investment group Vision Blue Resources (VBR) is diversifying with a $40-million investment in Mayur Resources’ Central Lime project, in Papua New Guinea (PNG).
The companies entered into a term sheet for a 49% equity interest in the project.
VBR CEO Sir Mick Davis comments that the importance of lime supply to the processing of minerals and metals linked to the energy transition is considerable.
“The project in PNG is compelling in terms of its size, scalability and quality, given the high calcium content of the deposit. The project has an attractive, low-risk profile which aligns well with VBR’s investment criteria, is fully permitted, construction is under way, and benefits from project-developed road and port infrastructure – all located in a strategic location, to support the PNG and greater APAC [Asia Pacific] markets,” he says.
The Central Lime project is 24 km from the capital city of Port Moresby and adjacent to a $19-billion liquefied natural gas facility, within its own special economic zone.
The proposed investment by VBR will be sufficient to satisfy the total equity funding required for the completion of the project’s development and to enter commercial production.
“We are thrilled to welcome VBR, a partner of impeccable pedigree, to collaborate on our Central Lime project. VBR’s recognition of the pivotal role of lime in meeting the escalating demand across various environmental and renewable energy sectors is evident,” says Mayur MD Paul Mulder.
Citing Wood Mackenzie, Mulder says forecast lime consumer demand versus the producer "supply response" shows an increasing supply deficit and dislocation in a supply chain being able to respond in the APAC region.
He notes that the Australian market in recent times has shown consumers are now willing to import higher grade, cleaner, better-performing lime from abroad.
“Collectively, with our partners VBR, we plan to become a dominant player not only in Australia, but also the APAC region. Indonesia has significant forecast demand for lime in the foreseeable future for its Nickel HPAL (high-pressure acid leach) plants, being constructed at an unprecedented rate, where, again, we plan to play a material role. This key downstream processing of its raw minerals opens a sizeable market opportunity in close proximity to the project, with PNG’s Prime Minister and Indonesia’s President having just last month resolved to markedly pursue increased bilateral trade relations.”
Phase 1 of the Central Lime project is estimated to generate revenues and earnings before interest, taxes, depreciation and amortisation of more than $50-million and $25-million, respectively.
Offtake letters of support for Mayur’s quicklime have exceeded the initial 400 000 t/a nameplate capacity of the project. A letter of support for up to 150 000 t/y has added to Mayur’s existing order book for 266 000 t/y of quicklime and hydrated lime products. Receipt of a formal expression of interest to supply up to 700 000 t/y of high-grade limestone ensures offtake milestones have now been reached for Phase 1.
The company has decided to deliver the project in two phases starting with a Phase 1 Quicklime plant. The Phase 2 clinker and cement facilities will be developed thereafter.