Battery materials maker Euro Manganese, which is working on extracting high-purity manganese from old mining waste at its Chvaletice project in Czechia, is seeing direct benefits from recent changes in EU and US regulation on becoming more self-reliant in the supply of raw materials needed for industry, and particularly, the green transition.
“Recent EU and US regulation related to on-shoring supply chains have triggered a positive response in dynamics with off-takers,” said Matthew James, president and CEO of Canada- and Frankfurt-listed Euro Manganese.
He noted that potential customers are proactively reaching out to the company and are motivated to advance through the offtake process. Customers are increasingly acknowledging the price premiums for Western extracted and processed products such as high-purity manganese. “This has resulted in more than 100% of our annual Chvaletice production being under discussion as part of our offtake tender process,” said James.
A key new prong in the company’s strategy is to start developing operations in North America and it has already started exploring a new high-purity manganese opportunity in Canada.
First manganese metal samples prove quality
Euro Manganese’s Chvaletice project is different from other mining projects in that it is not extracting manganese from the ground, but is re-processing old tailings from a decommissioned mine to produce high-quality manganese metal and sulphate.
The demonstration plant at the site has recently produced its first sample of 99.9% pure electrolytic manganese metal and testing by an external laboratory confirmed that the sample met the plant’s target specifications. The next step for Chvaletice is already under way: producing test samples of high-purity manganese sulphate monohydrate which will be sent for outside testing in the coming weeks. The labs are expected to return their reports by the end of June.
Looking at the broader picture at Chvaletice the company said that once the project is permitted, offtake agreements have been entered into and the remaining land access rights have been acquired Euro Manganese intends to secure financing for the construction of the full-scale process plant and related infrastructure.
Off-take deal with Verkor
In the meantime, the company has agreed on the off-take term sheet for its manganese sulphate monohydrate with French battery maker Verkor for the initial eight years. Verkor is a key player in the European EV battery space which plans to build a battery giga-factory to meet European demand for electric vehicles and stationary storage.
Once fully operational Chvaletice has the potential to provide up to 20% of the projected 2030 European demand for high-purity manganese.
Project-related expenses in the last quarter including the commissioning of the demonstration plant and deposits for the land at the tailings area meant that the company’s cash position in the second quarter is now at approximately C$13.8 million, down from $18.3 million at the end of the first quarter.
The spend also included the submission of the final Environmental and Social Impact Assessment and administrative expenses related to project financing efforts. However, the analysis of the first manganese metal samples has significantly de-risked the company’s process flow sheet.
Euro Manganese said that it has sufficient funding to deliver near-term project targets including completing the permitting for construction of the Chvaletice project, commissioning of the demonstration plant and its operation on a batch basis. The company will need additional funding for EPCM services, future payments for land acquisitions, and future construction of infrastructure and facilities.
Source: the armchair trader
