12.5 C
Belgrade
06/10/2024
Mining News

Vanadium Resources secures off-take agreement with chinese producer, accelerates South African operations

Vanadium Resources (VR8), an ASX-listed junior company with a focus on South Africa, has announced a memorandum of understanding (MoU) for off-take with Panjin Hexiang New Materials Technology, one of China’s prominent vanadium nitride producers. According to the MoU, VR8 will supply 4,000 tons per year of vanadium pentoxide (V2O5) from its Steelpoortdrift and Tweefontein vanadium operations to Hexiang over a five-year period, with the potential for a five-year extension.

This agreement represents approximately 37% of VR8’s planned V2O5 flake production capacity of 11,000 tons per year for the initial Phase 1 operations. VR8’s CEO, John Ciganek, has expressed optimism about the partnership, highlighting Hexiang’s expertise in converting V2O5 into vanadium-nitrogen alloys primarily used in the steel industry. Additionally, VR8 retains production capacity to explore other off-take opportunities or venture into the vanadium redox flow battery market.

Supported by

The Steelpoort project, owned by VR8, holds a significant vanadium deposit with promising longevity. With a mineral resource of 680 million tons at an average in-situ grade of 0.7% V2O5 and a proved and probable ore reserve of 77 million tons at an average grade of 0.72%, the project demonstrates substantial potential. VR8 plans to produce a vanadium-rich concentrate at Steelpoort, transported to the nearby Tweefontein project, aiming to produce an average of 18,000 tons per year of V2O5.

The Steelpoort project has the capacity to sustain production for over 180 years at proposed throughput rates for concentrate at the Tweefontein plant. A definitive feasibility study (DFS) conducted in October 2022 confirmed the combined projects as a world-class deposit with robust economics, yielding an attributable post-tax net present value (NPV) of $0.9 billion, an internal rate of return of 42%, and a 27-month payback period. Following the DFS, VR8 increased its ownership in the Steelpoortdrift project to 86.49%, resulting in an improved attributable NPV of $1.05 billion.

Related posts

Buenos Aires Governor signs lithium cooperation agreement with Mexico’s LitioMx

David Lazarevic

Brazil takes steps to harness critical minerals potential

David Lazarevic

Environmental and Economic groups criticize Australia’s coal mine expansions

David Lazarevic