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Iofina expecting increase in production as IO#7 plant scales-up operations

The new IOsorb plant, IO#7, which began to scale up operations in mid-February, is already contributing significant additional production at more than double the production rate of its predecessor, IO#3

Iofina's operations in Oklahoma
IO#3 has been successfully repurposed to IO#7, and a similar determination on the future use of IO#5 is being reviewed

Iodine extraction specialist Iofina plc (LON:IOF) overcame terrible winter conditions to keep output roughly stable, year-on-year, in the first quarter.

The company said it produced 118.2 tonnes of crystalline iodine from its operating Oklahoma-based IOsorb plants in the first three months of the year, down just a tad from 118.7 tonnes in the same period of 2017.

WATCH: 'Things are adding up for Iofina' with increased year-on-year production

Two of its plants (IO#3 and IO#5) were offline at the start of the quarter, while IO#07 only came online part-way through the quarter.

Operations in January and February were affected by extreme winter weather in Oklahoma and a greater diversion of brine flow, including at IO#5, than had been anticipated.

The iodine production run-rate for the group in March was significantly higher than in the first two months of the year, Iofina said, as the IO#7 plant scaled-up operations.

The ramp-up at IO#7 has occurred broadly as expected as Iofina and its brine supply partner continue to work together to maximize brine input and iodine output. As IO#7 optimises its production, the company expects overall total iodine production rates in the current quarter to increase.

Demand for and sales of iodine and iodine-based derivatives through Iofina Chemical were as anticipated for the reporting period.

Iofina Chemical added additional chemical reactor capacity for iodide products during the period to meet demands. Prices of iodine and iodine-based compounds rose slightly in the period continuing their upward trend from 2017.

''Despite the effects of the weather and brine supply, 2018 iodine production is off to a solid start with the opening of IO#7 midway through the quarter, which is expected to increase output and reduce iodine production costs in Q2 2018. Importantly, commencement of production at IO#7 started on time and management expects output from the plant to increase during the year as it moves to full optimisation. Management continues to review the strategy for IO#5 in order to optimise production from this plant,” said Dr Tom Becker, the president and chief executive officer of Iofina.

"The trend of iodine prices continues to move upward and is an additional benefit for Iofina as it moves forward and executes its growth strategy to increase iodine output whilst lowering production costs," he added.

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