# Firering Strategic Minerals Plc: Near-Term Revenue Potential with Limeco Quicklime Project

- Link: https://www.directorstalkinterviews.com/firering-strategic-minerals-plc-near-term-revenue-potential-with-limeco-quicklime-project/4121162463
- Published: 2024-06-26T07:55:11+01:00
- Author: Anthony Fox

**[Firering Strategic Minerals Plc](https://www.directorstalkinterviews.com/company/firering-strategic-minerals-plc/frg.l)**(
LON:FRG), an AIM-quoted company, is set to enhance its revenue potential significantly
through its recent acquisition of Limeco Resources Limited. Limeco, an ex-Glencore
asset in Zambia, is poised to become a major player in the quicklime market, providing
essential material for various industrial processes, particularly in copper flotation.

**Strategic Acquisition and Increased StakeFirering recently announced an updated
agreement to acquire a 20.5% stake in Limeco for $3.55 million, with an option to
increase this to 45% for an additional $4.65 million. This move replaces an earlier
agreement which allowed for a maximum 28.33% stake. The Limeco plant, originally
built by Glencore with over $100 million in capex, includes a limestone quarry and
a fully operational lime plant. This facility is designed to produce quicklime, 
a critical reagent in copper flotation, steelmaking, and various other industrial
processes.

**Fast-Track Commissioning and ModificationsFirering aims to commence commissioning
the first of Limeco’s eight kilns by Q4 2024, with all kilns expected to be operational
by Q3 2025. To achieve this, several key modifications are underway, including enhancements
to the crushing plant and a switch from heavy fuel oil (HFO) to coal gasification.
This change is expected to reduce costs and environmental impact, while also generating
additional revenue streams from aggregate and ash by-products.

**Economic Opportunities and Market DemandQuicklime prices have been robust, trading
between $160 to $218 per tonne. Limeco’s production capacity ranges from 219,000
to 292,000 tonnes per annum. Analyst projections suggest that even at a conservative
production estimate of 200,000 tonnes per year, and a price of $150 per tonne, annual
gross revenue could reach $30 million, with Firering’s 45% stake translating to 
$13.5 million. This excludes additional revenue from by-products and leasing defunct
HFO tanks.

The quicklime market is projected to grow significantly, driven by the increasing
demand for copper, particularly for electric vehicles, renewable energy, and technological
advancements. The quicklime produced by Limeco will primarily serve the copper processing
sector, which is expected to see substantial growth due to the global energy transition.

**Analyst InsightsShard Capital Head of Corporate Broking Damon Heath says, “The
timing is prescient for a new quicklime operation, dovetailing perfectly with the
copper demand thesis. A near-revenue company with a market cap of only £5 million
highlights the compelling economic opportunity presented by Firering’s investment
in Limeco.”

**Final ThoughtsFirering Strategic Minerals’ investment in Limeco Resources positions
the company strategically to benefit from the burgeoning demand for quicklime in
the copper processing industry. The planned fast-track commissioning and modifications
of the Limeco plant, coupled with robust market dynamics, underscore the significant
revenue potential for Firering in the near term. As the company progresses towards
full operational capacity, stakeholders can anticipate substantial value creation
driven by this strategic acquisition and market alignment.

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