Vanadium play Technology Metals ahead of the pack as study nears completion
Technology Metals Australia has achieved high recoveries of vanadium from its Gabanintha project at a time when vanadium redox flow batteries are proving a much superior alternative for stationary grid-scale energy storage.
Just 15 months since it made its debut on the ASX, Technology Metals (ASX:TMT) has gone from effectively no drilling at its Gabanintha project to delivering a global resource and is now just a couple months away from releasing its pre-feasibility study.
“We’ve taken a fairly aggressive approach to the development of our project,” executive director Ian Prentice told Stockhead.
“We are a one-project company, so we’ve been very focused since the start and that’s how we’ve been able from a standing start to deliver our global resource within a short timeframe and the aim of delivering a pre-feasibility study within 18 months of listing.”
Come June, Technology Metals will be one of only a few ASX-listed companies that will have completed a full pre-feasibility study on an Australian vanadium project, placing it ahead of the majority of its peers.
And it has just proven it can achieve high recoveries of up to 97.2 per cent vanadium into solution using a conventional process that carries a much lower capital cost than other developing processing options.
Technology Metals confirmed it can achieve the high recoveries with conventional salt roast/water leach processing.
“It was always our belief that the Gabanintha ore would be amenable to that technology, but this test-work has absolutely confirmed that,” Mr Prentice said.
“The conventional method works, which is important certainly from a capital expenditure point of view. It’s probably a half to a third of the capex requirement for the same scale of project using more novel development-type processing technologies.”
Work is now progressing to produce a high purity vanadium pentoxide flake final product.
The work is being undertaken as part of a prefeasibility study that is on track and slated for release in June 2018.
Technology Metals has a high level of confidence in the outcome of the study and plans to move straight into a definitive feasibility study once the prefeasibility study is complete.
High grade core
The Gabanintha project has a consistent high-grade core of 55 million tonnes at 1.1 per cent vanadium pentoxide within a global resource of 119.9 million tonnes at 0.8 per cent vanadium pentoxide, positioning it as one of the highest grade vanadium deposits in the world.
The global resource covers 5.5km of a high grade mineralised layered mafic igneous unit.
VRBs the preferred option for grid-scale energy storage
About 90 per cent of global vanadium production is used to make high-strength steel, but future demand stems from its role in vanadium redox flow batteries (VRBs), which can store more power and discharge it over a much longer period than lithium ion batteries.
VRBs are rechargeable flow batteries that use vanadium in different oxidation states to store energy.
Their ability to time-shift large amounts of previously generated energy for later use makes them ideal for micro-grid to large scale energy storage solutions.
Compared to lithium ion batteries, VRBs are non-flammable, environmentally friendly, have estimated lifespans in excess of 20 years with a very high cycle life of up to 20,000 cycles and no capacity loss.
VRBs have excellent charge retention, as opposed to the charge degradation common in lithium ion batteries.
Although the upfront cost of a VRB may be a bit more than a lithium ion battery, the annual cost is significantly cheaper because its life is at least double.
“You might pay a little more capital upfront to secure that battery, but it means you’re amortising over 20 years as opposed to the lithium ion batteries that might only be amortising over seven to 10 years,” Mr Prentice said.
The other advantage of VRBs is that as technology evolves, the battery doesn’t need to be scrapped and replaced with a new one, it basically just requires a “service”.
A greener alternative with a much higher level of recyclability compared to lithium ion batteries.
“If they’ve made a major breakthrough in the chemistry of the electrolyte, they can actually pump the electrolyte out, make the necessary chemical changes to it and then pump the electrolyte back into the battery,” Mr Prentice explained.
“So the infrastructure stays the same, they pump the electrolyte out – basically give it a service – and put it back in and your battery is more efficient.”
The global vanadium market has been in a supply-demand deficit for the past five years. It is estimated the shortfall in 2017 was just under 10,000 tonnes.
Significant production declines in China and Russia have exacerbated the situation, with further production cuts expected in the short term from China’s environmental restrictions and the banning of the import of vanadium slag.
Vanadium becoming more valuable
The price of vanadium has rocketed 550 per cent in the past three years, outpacing other commodities.
Vanadium pentoxide prices have rallied further this year to over $US14 ($18) per pound from a low of less than $US4 per pound in early 2017.
While global economic growth and increased intensity of use of vanadium in steel in developing countries will drive near-term growth in demand, VRBs will be the big driver of demand over the next two to five years.
Pu Neng Energy of China, chaired by Robert Friedland – who’s High Power Exploration group has invested over $US90 million to date, has been awarded a contract to develop a series of VRBs in Hubei province, leading to the eventual development of 100MW/500MWh energy storage solutions as the cornerstone to a new smart energy grid.
At the same time, Rongke Power in China’s Dalian province is building a 200MW/800MWh battery, which is going to need something like 7000 tonnes of vanadium pentoxide.
To put that in perspective, Largo Resources, which is producing out of Brazil, has a nameplate capacity of about 10,000 tonnes per annum.
This means that one battery being built by Rongke will need vanadium equal to 70 per cent of Largo’s annual production.
This special report is brought to you by Technology Metals Australia.
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