May 21 2002
In a statement tendered to the Australian Stock Exchange, The Australian Magnesium Company (AMC) told them that their Stanwell Magnesium Project was progressing on schedule. In fact, they believed, that it would come in under baudget and ahead of schedule.
Just five months after the announcement the project would proceed, AMC have agreed to a contract control price (CCP) with Leighton Contractors for $987 million. This will cover approximately 80% of the capital expenditure on the new facility.
Other direct and indirect costs have been estimated at $260 million, less then the $1.3 billion estimated earlier on in the project.
Some reasons for the lower than expected costs are due to: redsign of certain parts of the plant; competition between tenderers; and increased pre-engineering.
projection have also been made that will result in the production costs for magnesium to be lower then was previously envisaged, down to $0.948 per pound compared to the original figure of $0.952 per pound. AMC are also negotiating an incentive contract with Leightons to reduce the 24 month ramp up period.
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Posted May May 21st, 2002