Construction work on the plant is set to begin immediately, with completion expected by 2026. Credit: LKAB/Peab/Cision.

Peab has received a contract valued at Skr118m ($10.74m) for the construction of LKAB’s demonstration plant for critical minerals in Luleå, Sweden.

This initiative is a step towards LKAB’s goal to establish an industrial park for critical minerals extraction from mining waste, which will include the production of phosphorus and rare earth elements essential for various industries such as agriculture and renewable energy.

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The contract involves the groundwork along with construction of the processing plant, which will serve as a basis for future decisions regarding the planned scale-up of production and the development of a full-scale industrial park.

Peab’s construction of the plant is not only pivotal for the green transition but is also focused on sustainability, aiming for climate neutrality, energy efficiency, and minimal waste.

The company’s engagement with LKAB began with a phase 1 contract, which entailed developing an optimised product and addressing risks and uncertainties in collaboration with the client.

The project is now advancing to phase 2 and the construction contract has been formalised. The collaborative traditional construction contract includes an option for additional stages beyond the initial phase.

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Construction work is set to commence immediately, with the completion of the plant anticipated in 2026.

LKAB project and sustainability manager Anders Lundgren said: “We’re looking forward to working with Peab because we value the importance of collaboration in running the project efficiently and safely. For LKAB, where safety comes first, I’m confident that we have the same goal.

“The demonstration plant will provide us with valuable insights into our planned scale-up of production of critical minerals while it will also contribute to higher safety, improved operating methods and a good working environment.”

In a recent development, Peab secured a Skr123m contract to construct a new nursing home in Grums, Värmland County for Stiftelsen Grums kommuns hyresbostäder. The turnkey contract, which is in partnering form, is scheduled to start in November 2024 and is expected to be completed in the first quarter of 2027.