Latrobe Magnesium Limited and EnergyAustralia Yallourn Pty Ltd. have signed a memorandum of understanding for Yallourn power station to supply its fly ash to LMG's proposed 3,000 tonnes per annum magnesium plant in the Latrobe Valley. The MoU allows for the expansion of the plant to 40,000 tonnes per annum. Latrobe Magnesium's project is a world-first in developing a magnesium production plant from brown coal fly ash. It will use its patented hydromet extraction process and its own newly developed fast cycle vertical retort furnace (FCR). The project involves four stages of development conduct testing of Yallourn fly ash using LMG hydromet process and Monash, university's ash leaching and precipitation process, complete a feasibility study, construct a 3,000 tpa magnesium plant and expand to a 40,000 tpa magnesium plant.