ASX-listed battery materials producer Neometals (ASX:NMT) has advanced to a formal finance appraisal with the European Investment Bank (EIB) as part of debt financing discussions for the Vanadium Recovery Project in Finland.
The company says this debt financing discussion is being run for its 50% owned joint venture (JV) company Recycling Industries Scandinavia AB (RISAB).
RISAB is evaluating the feasibility of constructing a facility to process and recover ‘high-grade’ vanadium oxide (V2O5) from vanadium-bearing steelmaking by-product generated by steelmakers SSAB EMEA, and SSAB Europe Oy in Scandinavia.
Neometals reports RISAB’s ongoing debt financing dialogue with the EIB has passed the proposal for funding consideration stage and has now entered into a formal appraisal stage of diligence by the EIB.
RISAB is also engaged in discussions with several debt providers and will make a final decision on the debt funding package and participating lenders in due course.
Commenting on the proposal, Neometals Managing Director Chris Reed says: “We first submitted our proposal to the EIB in October 2022, its acceptance validates our circular economy ambition to produce critical raw materials in Europe. Typically, cornerstone funding from the EIB for environmentally sustainable opportunities in the battery supply chain is on very attractive terms.
There is keen interest from a number of debt providers for the funding of the Vanadium Recovery Project. We watch with interest the imminent release of the EU (European Union) Critical Raw Materials Act today in Europe, particularly the expected financial support for strategic projects that produce critical raw materials, like vanadium, where the EU is 100% dependent on imports.”
“There is keen interest from a number of debt providers for the funding of the Vanadium Recovery Project”
Neometals says the EIB is the lending arm of the European Union and is one of the largest providers of climate finance through its focus on climate action and environmental sustainability. Every year the EIB provides direct loans for a wide range of projects.
The company says the EIB proposal assessment noted that the Vanadium Recovery Project would be processing a steelmaking by-product that is currently stockpiled, while the recycling nature of the project avoided upstream mining costs or associated operating risk.
Importantly, the European Commission has identified vanadium as a ‘Critical Raw Material’ (CRM), and the EIB published a notice on the subject saying: “The project supports a circular economy solution that will reduce the usage of primary resources for vanadium manufacturing.”
Neometals reports the Vanadium Recovery project has passed a key stage of finance appraisal with the EIB. Remaining in this appraisal stage is the lenders technical assessment (LTA) which has been prepared by independent third-party experts.
The company says EIB satisfaction with the LTA represents the last piece of diligence before a binding term sheet can be offered for debt financing.
Neometals is a battery materials producer that is developing a suite of green battery materials processing technology that reduces reliance on traditional mining and processing.
The company currently holds a 50% interest in Lithium-ion Battery Recycling with plant building company SMS group to produce nickel, cobalt, and lithium from production scrap and end of life lithium-ion batteries.
It also holds a 50% equity in the Vanadium Recovery Project with Critical Metals (LON:CRTM) which is aiming to produce 300,000 tonnes per annum (tpa) of vanadium from steelmaking by-product (Slag) provided by SSAB.
Neometals also holds a 35% interest in Lithium Chemicals with Portuguese chemicals company Bondalti Chemicals to produce battery quality lithium hydroxide from brine or hard rock feedstocks using patented ELi electrolysis owned by RAM (70% Neometals and 30% Mineral Resources (ASX:MIN)).
Images: Neometals Ltd
