KUCHING, April 22 — The Sarawak government has agreed to an Australian company to set up a magnesium production plant in the Samalaju Industrial Park in Bintulu.

Sarawak Deputy Premier Datuk Awang Tengah Ali Hasan today confirmed meeting representatives of Latrobe Magnesium Ltd which has proposed to build a plant that will produce 100,000 tonnes per annum of magnesium.

"They are now conducting a pre-feasibility at the Samalaju Industrial Park,” he told reporters at Sarawak Premier Tan Sri Abang Johari Openg’s Hari Raya’s open house at the Borneo Convention Centre Kuching here.

Awang Tengah, who is also the state minister of international trade and industry, industrial terminal and entrepreneur development, said the plant will benefit Sarawak in terms of job opportunities and economic impact.

He said Latrobe chose Sarawak because of the availability of cheap renewable energy and found Samalaju a suitable location to build the factory.

Magnesium has the best strength-to-weight ratio of all common structural metals and is increasingly used in the manufacture of car parts, laptop computers, mobile phones and power tools.

According to media reports, the availability of abundant hydropower was a significant factor in the decision-making process, enabling Latrobe to produce magnesium with potential net-zero emissions on a life cycle analysis basis using 100 per cent renewable power.

The company is also reported to have discussed with Sarawak authorities, including the state ministry of international trade and industry, on securing a 40-hectare site near port facilities and ferro-silicon producers.

Latrobe will kick off phase B of the pre-feasibility study, with Bechtel, on the selected location.

According to the media reports, the Samalaju location has notable strengths compared to other two options in the Middle East, which were said to be Ras Al Khair in Saudi Arabia and Duqm in Oman.

One of Samalaju’s pull factors was the presence of major ferro-silicon producers.