NZ’s new pro-mining government boosts approval prospects for Manuka’s massive vanadium-titanium project
Special Report: In a significant turn of events, the election of the new coalition government led by New Zealand’s National party and new PM Christopher Luxon, has dramatically and positively altered the political landscape for the country’s resource industry. The newly appointed Resources Minister, Shane Jones, is strongly supportive of the country’s mining industry, in particular the development of offshore titanomagnetite iron sand and vanadium resources in the South Taranaki Bight.
The very recent change in the New Zealand government should prove extremely positive for Manuka Resources (ASX:MKR) and its offshore Taranaki vanadium rich titanomagnetite (VTM) project.
Long regarded by investors as a very difficult jurisdiction in which to get resources projects up and running New Zealand’s mining sector could be set for a renaissance under the leadership of PM Chris Luxon and the newly appointed Minster for Resources, Shane Jones.
Shane Jones, a senior MP and cabinet minister in coalition partner, the New Zealand First party, is pro-mining and has been vocally supportive on the importance of parliamentary decision-making over judicial intervention in the approval of seabed mining projects.
He was quoted recently saying: “Unless we use the natural resources of our country, unless we maintain investment in our natural resource sector we won’t get the rare earth minerals that are in New Zealand, we won’t keep the young people who are desperate to improve the quality of their life in New Zealand – they’ll go to Australia to dig up Kalgoorlie and that’s something grossly hypocritical about the green movement.”
Manuka’s Taranaki VTM project has little value in the company’s share price, despite an investment of $NZ85m ($79m) to date, that received a mining licence in 2014 and environmental consents in 2017 but faced legal challenges ever since. A plight all too familiar to resource project proponents in the country.
The recent Supreme Court decision referred the consents back to the Environmental Protection Authority (EPA) for reconsideration on five narrowly defined points of law. Manuka has actively participated in the process, providing expert evidence supporting development.
Experts concluded the proposed VTM mineral recovery in the South Taranaki Bight would not cause material harm to the seabed or marine mammals and seabirds.
The company has lodged its expert submissions for the reconsideration of its marine environmental consents to operate with the EPA and, with hearings now scheduled for early 2024, is anticipating the Decision Making Committee’s final approvals by mid-year.
Under the coalition government Manuka now has far more optimism around the environmental re-approval of the Taranaki VTM project, with the new government committing to a range of key policy initiatives for the development of natural resources and mining projects.
These initiatives include a ‘100 Day Plan’ based on parties’ priorities; updating the Crown Minerals Act to promote the use of Crown Minerals; creating a Critical Minerals list likely to include vanadium and titanium; prioritising regional and national projects of significance; amending the Resource Management Act (RMA) and a ‘fast track’ one stop shop consenting and permitting process for natural resource projects of national significance.
Perhaps most importantly for Manuka, the new government is also looking at strategic opportunities in NZ’s mineral resources, including vanadium, and developing a plan to develop these opportunities.
In March this year, Manuka released an initial resource of 3.2 billion tonnes at 0.05% vanadium pentoxide (V2O5) for the project, ranking it as one of the larger drilled vanadium deposits globally.
Manuka executive director Alan Eggers said at the time the resource was announced: “Despite an awareness of its vanadium potential, the vanadium resource had not previously been estimated. The recent completion of this work highlights a very large resource in terms of contained vanadium making it a potential vanadium producer of world scale.”
The South Taranaki Bight VTM concentrate grades 55% to 57% iron contains 0.5% V2O5 and 8.4% titanium dioxide (TiO2).
At an assumed production rate of 5 million tonnes per annum of VTM concentrate the operation could produce up to 20,000 tonnes per annum of V2O5, making Manuka one of the largest aspiring vanadium producers on the ASX.
The project is expected to be a low-cost and low emissions concentrate producer, with a very small environmental footprint compared to other hard rock iron ore deposits.
It will be in the bottom quartile of CO2 emitters for iron ore producers globally, with an estimated 62kg of CO2 per tonne of VTM concentrate compared to the international average of 125-250kg of CO2 per tonne.
It also holds promise not just for the company but for New Zealand’s position in the global market.
As a feed for electric arc furnaces (EAF) and with the growing demand for low carbon “green steel,” the project aligns with global trends toward sustainable steel production.
Vanadium’s critical mineral status in the EU, USA, Canada and Australia, coupled with concerns over the sovereign security of its supply from key producing nations China and Russia, positions Taranaki’s vast vanadium resources as a strategic asset.
Development of the Taranaki VTM project could potentially elevate New Zealand to the third-largest vanadium producer globally.
In light of Jones’ appointment and the government’s policy direction, the outlook for Manuka and the Taranaki VTM project appears optimistic, marking a significant milestone on the company’s path to becoming a key player in the global vanadium market.
This article was developed in collaboration with Manuka Resources, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.