Australia’s Altech Chemicals Ltd. announced yesterday that it has negotiated a fixed-price EPC (engineering, procurement, and construction) deal with German contractor M+W Group to build a high-purity alumina plant in Malaysia.
Touting the advantages of the fixed-price nature of the contract, which include de-risking completion risk and project operability risk, Altech elaborated on the nature of the overall project, pointing out the fact that engineering of the plant began in mid-2016.
The firm says that the final project plan should be settled at some point in the next quarter, at which point Altech will be able to submit an application for a government-backed export credit finance and total debt package from the German government. The project qualifies for such financial assistance as M+W Group is based in Stuttgart.
At the present time, the two parties are endeavoring to finalize details of the contract. Upwards of fifty M+W engineers are working to finalize the plant’s engineering and design.
“Reaching conceptual agreement with M+W Group on a fixed price construction contract is a significant de-risking accomplishment for Altech shareholders. The fixed price contract also delivers to debt providers a high level of comfort in terms of total project costs, potential cost overruns and completion delays. This is a great outcome and achievement for the Company,” explained Altech’s managing director Iggy Tan.
Altech Chemicals is based in Subiaco, Western Australia and is attempting to develop a marketable process for delivering 99.99% (4N) HPA. It plans to construct a 4,000 metric ton per annum HPA plant at Tanjung Langsat Industrial Complex, Johor, Malaysia. The plant is expected to be fueled by the company’s kaolin deposit at Meckering, Western Australia. The firm is fast-tracking HPA production due to an agreement with Mitsubishi for 100% of its proposed HPA production for ten years. At present, Altech intends to commence project development in the third quarter of this year.