KUCHING: OM Holdings Ltd
’s (OMH) ferroalloy smelting plant in Samalaju Industrial Park, Bintulu, will be incorporating higher value-added silicon metal in its production line.
The smelting plant under wholly-owned subsidiary OM Materials (Sarawak) Sdn Bhd (OM Sarawak) has successfully modified and converted two ferrosilicon (FeSi) furnaces into metal silicon (MetSi) furnaces to produce silicon metal.
“The first MetSi furnace is currently undergoing hot commissioning and performance testing,” according to OMH in a recent investor presentation update.
The MetSi furnace has a production capacity of 35 tonnes to 40 tonnes per day. Silicon metal is often used for aluminium, aluminium alloys and the chemical industry.
The modification and conversion work process involved the dismantling of two idle FeSi furnaces, followed by civil works and equipment installation carried out by contractors from China in December 2021.
The smelting plant has 16 units of furnaces, of which six units are allocated for the production of FeSi, eight units for manganese alloys and two units for silicon metal.
It has the design capacity to produce between 120,000 and 126,000 tonnes of FeSi, 330,000 to 400,000 tonnes of manganese alloys and 21,000 to 24,000 tonnes of silicon per annum.
OM Sarawak’s future plans include the expansion of the production capacity of manganese alloys by an additional 150,000 tonnes per annum. The flagship plant complex also consists of a sinter plant that has a design capacity to produce 250,000 tonnes of sinter ore per annum.
In the financial year ended Dec 31, 2022,OM Sarawak recorded total output of 140,355 tonnes of FeSi and 216,813 tonnes of manganese alloys and sold 146,646 tonnes and 216,604 tonnes of FeSi and manganese alloys, respectively.
The company also produced 112,711 tonnes of manganese sinter ore (commissioning phase).
OMH, via wholly-owned subsidiary OM Materials (S) Pte Ltd, completed the acquisition of the remaining 25% stake in OM Sarawak from Cahya Mata Sarawak Bhd for US$120mil (RM520mil) in December 2022.
In 2023, OMH, which is dual-listed on the Australian Securities Exchange and Bursa Malaysia, expects OM Sarawak to produce between 320,000 and 370,000 tonnes of various products.
Eight furnaces will undergo major maintenance works in phases throughout 2023.
“With production at similar levels to financial year 2022, 11 out of 16 furnaces are expected to be fully operational. There will be an upside to production as China’s borders reopen,” said the company.
In a market review, OMH said FeSi prices have been flat in Asia as demand remains weak amid elevated Chinese costs.
“To date, prices have been flat for over four months due to higher Chinese costs and strengthening yuan. Chinese exports decreased 36% over 2022 in the second half of the year, compared with the first half.
“In 2022, the Russia-Ukraine conflict supported prices briefly as Russia is the world’s second-largest exporter (of FeSi).
“Asian prices are largely determined by Chinese export prices, albeit at higher costs. Prices corrected and stabilised from the third quarter due to low demand,” it added.
