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Orbite releases capital cost and timeline estimates for high quality alumina plant
Edited by : AL CIRCLE
3 min read
Orbite commissioned and recently received two independent capital cost and timeline estimates for completing the high-purity alumina production plant in Cap-Chat, Quebec, including the installation of the new calcination system.
These were subsequently reviewed and analysed by Orbite management and engineers, and were also compared to a third estimate prepared by company’s general contractor. The Corporation is now in a position to report updated capital cost and timeline estimates to achieve the Phase II production capacity of 3 tonnes per day.
In its Management Discussion and Analysis for the period ended December 31, 2012, the Corporation estimated that capital costs for the HPA plant totalling $85 million before refundable investment tax credits (or $55 million net of RITC) would be required to complete the plant.
As at March 31, 2013, the Corporation had incurred external capital costs of $74.9 million (or $51.2 million net of RITC). Based on the Independent Estimates, the Corporation is revising its capital cost estimate, before RITC, to $105.9 million (or $75.9 million net of RITC), which represents an increase of $20.9 million to the estimate provided in the December MD&A and includes $6.7 million in contingency and critical spare parts.
As a result, the projected total external capital costs required to complete the construction and commissioning of the HPA production facility, in addition to those already incurred at March 31, 2013 is $31,010.
The updated capital cost estimate represents the investment required to achieve the Phase II production capacity of 3 tonnes per day. A large portion of the HPA plant has been designed at a 5 tonnes per day capacity, and as such, the requisite engineering analysis to increase the total plant throughput to 5 tonnes per day, as well as to add a scandium and gallium separation facility, is expected to be completed during the second half of 2013 and the incremental capital cost estimate is expected to be reported during the first quarter of 2014.
Based on the Independent Estimates, which included a review of construction labor time, the Corporation is also updating the anticipated project timelines for achieving the Phase II production capacity of 3 tonnes per day to the end of the second quarter of 2014, representing a delay of approximately 6 months from the previous estimates. This is based upon a 12-month project execution timeline commencing once the Corporation has raised the necessary capital to proceed.
"Given the highly detailed effort employed by both independent engineering firms in preparing the revised estimates and by Orbite management in vetting them, we are confident in meeting both the cost and timeline targets. In addition, a large part of my personal responsibilities will be to deliver this facility on time and within budget," said Glenn Kelly, EVP and Chief Operating Officer.
These were subsequently reviewed and analysed by Orbite management and engineers, and were also compared to a third estimate prepared by company’s general contractor. The Corporation is now in a position to report updated capital cost and timeline estimates to achieve the Phase II production capacity of 3 tonnes per day.
In its Management Discussion and Analysis for the period ended December 31, 2012, the Corporation estimated that capital costs for the HPA plant totalling $85 million before refundable investment tax credits (or $55 million net of RITC) would be required to complete the plant.
As at March 31, 2013, the Corporation had incurred external capital costs of $74.9 million (or $51.2 million net of RITC). Based on the Independent Estimates, the Corporation is revising its capital cost estimate, before RITC, to $105.9 million (or $75.9 million net of RITC), which represents an increase of $20.9 million to the estimate provided in the December MD&A and includes $6.7 million in contingency and critical spare parts.
As a result, the projected total external capital costs required to complete the construction and commissioning of the HPA production facility, in addition to those already incurred at March 31, 2013 is $31,010.
The updated capital cost estimate represents the investment required to achieve the Phase II production capacity of 3 tonnes per day. A large portion of the HPA plant has been designed at a 5 tonnes per day capacity, and as such, the requisite engineering analysis to increase the total plant throughput to 5 tonnes per day, as well as to add a scandium and gallium separation facility, is expected to be completed during the second half of 2013 and the incremental capital cost estimate is expected to be reported during the first quarter of 2014.
Based on the Independent Estimates, which included a review of construction labor time, the Corporation is also updating the anticipated project timelines for achieving the Phase II production capacity of 3 tonnes per day to the end of the second quarter of 2014, representing a delay of approximately 6 months from the previous estimates. This is based upon a 12-month project execution timeline commencing once the Corporation has raised the necessary capital to proceed.
"Given the highly detailed effort employed by both independent engineering firms in preparing the revised estimates and by Orbite management in vetting them, we are confident in meeting both the cost and timeline targets. In addition, a large part of my personal responsibilities will be to deliver this facility on time and within budget," said Glenn Kelly, EVP and Chief Operating Officer.
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