Australian Vanadium (ASX:AVL) sees scope for organic growth before becoming a consolidator of assets as it seeks to bring the Australian Vanadium Project at Gabanintha online.
The company yesterday (6 August 2024) announced the City of Greater Geraldton Council has passed a resolution to support a local planning scheme amendment for the site of the company’s proposed vanadium processing plant at Tenindewa, located about 65km east of Geraldton.
Speaking to Mining.com.au on the sidelines of the Diggers & Dealers Mining Forum in Kalgoorlie, CEO Graham Arvidson says this is one of the final steps in the process of rezoning the site from ‘rural’ to ‘industry’ land use.
The Australian Vanadium Project includes a mine and a crushing, milling, and beneficiation plant (or concentrator) located at Gabanintha, near Meekatharra, plus the downstream vanadium processing plant at the site at Tenindewa, near Mullewa. The company also owns and operates a vanadium electrolyte plant in Perth.
“We’ve got a lot of resource in the ground there. We’ve taken two companies (Australian Vanadium and Technology Metals Australia) who had a 25-year mine life and bolted them together. We have one of the highest grade orebodies around, and so we intend to be a low-cost producer,” Arvidson tells this news service.
“We don’t actually see ourselves needing additional resource yet. But honestly, we also expect to be having first mover status and be the logical owner and consolidator of assets at some point. That’s what’s really exciting is we can take this business model, we can scale the upstream, the mining, and the processing at Geraldton; all scalable concepts because we have VTM deposits throughout the Mid West.
“We have a midstream there, the electrolyte; very scalable. Lastly, you’ve got the battery side that’s very scalable simply because there’s a very large energy market with a lack of commercially-proven technology to fill that void. We’re just really excited. What the future holds in terms of M&A or whatever in the future, that’s a long way off.”
Once the Australian Vanadium Project comes online it will the first and only primary vanadium producing project in Australia.
Arvidson tells Mining.com.au there’s a lot of interest in vanadium at the moment, although there are only a handful of projects on a development pathway.
“With our project, we consider ourselves the frontrunners because we’re very advanced on the permitting and we have done full pilot scale testing of our orebody,” he says.
“The only thing we’re doing now is an optimised Feasibility Study, and that’s simply because we’ve merged two large businesses into a better business, and we’re creating a stronger-for-longer project from that.”
In February this year, Australian Vanadium and Technology Metals Australia closed the books on their synergistic merger, forging what could be Australia’s first operating primary vanadium producer.
On 25 September 2023, Australian Vanadium and Technology Metals Australia agreed to a $217 million merger via a proposed scheme of arrangement, as reported by Mining.com.au.
“It was really critical for both businesses that we came together, and it’s turning out to be a really great stroke. That’s from the lens of we’re much more likely to get finance now, and whether that’s debt or equity financing, it’s a very clear story,” Arvidson adds.
“Ultimately, when you remove those tenement boundaries, there are very significant physical synergies, and that’s what we’re running to ground with the optimisation. We’re also more likely to get finance because we’re going to have a stronger project. That’s really important.”
The Australian Vanadium Project is one of the most advanced vanadium projects being developed globally, with 395.4 million tonnes at 0.77% vanadium pentoxide (V₂O₅), containing a high-grade zone of 173.2Mt at 1.09% V₂O₅, reported in compliance with the JORC Code 2012.
VSUN Energy is Australian Vanadium’s 100% owned renewable energy and energy storage subsidiary which is focused on developing the Australian market for vanadium flow batteries for long duration energy storage.
Australian Vanadium’s vertical integration strategy incorporates processing vanadium to high purity, manufacturing vanadium electrolyte and working with VSUN Energy as it develops projects based on renewable energy generation and VFB energy storage.
Write to Adam Orlando at Mining.com.au
Images: Australian Vanadium
