Technology Metals Australia: powering forward with a globally significant vanadium project

This is the first in a 2-part feature series.

This article is a sponsored feature from partner Technology Metals Australia Ltd. It is not financial advice. Talk to a registered financial expert before making investment decisions.

In the burgeoning world of critical minerals, many junior exploration companies lay claim to having a project of ‘global significance’.

However, few of these touted projects would likely pass the ‘pub test’ let alone withstand even the most superficial scrutiny.

Advanced vanadium developer Technology Metals Australia (ASX:TMT) is one junior exploration company with a flagship project indeed positioned to be globally significant.

And the facts speak for themselves.

The company is progressing the development of the Murchison Technology Metals Project (MTMP) in Western Australia to produce high purity vanadium pentoxide (V2O5) and a ‘high value’ ilmenite by-product. Following a November upgrade, the MTMP measured and indicated Mineral Resource Estimate (MRE) grew to 63.2 million tonnes at 0.9% V2O5 within the global MRE of 153.7Mt at 0.8% V2O5.

MTMP will produce 6% of the world’s vanadium

Importantly, MTMP will produce 6% of the world’s vanadium when it comes online. And to top it off, it is poised to be the first and only Australian vanadium project in production when it does.

As Managing Director Ian Prentice explains, Technology Metals has an emerging large, robust, and financially rewarding vanadium project that the world simply needs.

“The MTMP is a long-life high revenue generating critical minerals project.

“The MTMP is a long-life high revenue generating critical minerals project”

And vanadium has been recognised on the list of critical minerals so the development of the MTMP will put Australia on the map as one of the world’s leading suppliers of vanadium, diversifying the supply chain. Note that Australia has the third highest economic reserve of vanadium in the world but currently no production.”

The ‘high-grade’ MTMP is located 50km south of Meekatharra in Western Australia and consists of the Gabanintha and Yarrabubba deposits. MTMP is being developed to be a stable, secure, long-term supplier of critical minerals, with targeted average vanadium production of 12,500tpa (27.5Mlbs pa) V2O5 over an initial 25-year mine life, as well as production of a highly sought after titanium (ilmenite) by-product while mining and processing ore from Yarrabubba.

MTMP in the international landscape

Why is the MTMP of such significance, globally?

The world’s vanadium market is currently dominated by China and Russia, with South Africa and Brazil among the top 4 producers.

As Prentice notes, China currently produces 62% of global vanadium and Russia 16%. He says the current geopolitical scenario and the international commitment to carbon emissions reduction under the Paris Agreement contribute to making the MTMP an important project globally.

“Given the impetus for supply chain security and diversification of the Australian economy to include production and downstream processing of the critical minerals required for manufacturing and the energy transition, the MTMP will be a strategic asset for Australia.

“So, for Australia, the MTMP is an important opportunity to fill that supply chain gap globally”

Australia, and particularly Western Australia being a Tier 1 mining jurisdiction is also looked upon favourably by our potential offtake partners due to our robust legislation and reliability of our infrastructure. For example, South Africa produces about 8% of global vanadium currently, however there are some challenges with the reliability of their energy infrastructure and political environment. So, for Australia, the MTMP is an important opportunity to fill that supply chain gap globally.”

The MD adds that Australian governments have a very strong focus on supporting the development of critical / battery minerals projects to secure the country’s position as the leader in the supply (and possibly processing) of the world’s critical minerals, which translates into project funding opportunities.

Examples of government agencies supporting this include the Northern Australia Infrastructure Facility (NAIF), the Critical Minerals Office (CMO), and Export Finance Australia (EFA).

According to Prentice, there are a number of features about MTMP that makes the project highly economic (and likely more so than its peers and competitors). The vanadium-bearing ‘high-grade’ massive magnetite ore at the MTMP, which will form the majority of the process plant feed, displays unique geological attributes.

“Firstly, the ore is fresh very close to surface, meaning it has experienced minimal oxidation to the ore body, which is vital in maximising yield from mined ore into magnetic concentrate (in the beneficiation stage) as well as end-to-end recovery of vanadium. This results in lower capital cost intensity and operating costs – particularly for the beneficiation section of the plant – and enables the application of proven processing technology.

Having fresh ore very close to surface also means that this very high yielding ore is accessed very early in the mine life – minimising pre-strip capital expenditure. The need to process oxidised ore in the early stages that is a component of some of our peers impacts on early cash flow – with a high mining rate delivering lower yields.”

The MD says the coarse grain size of the ‘high-grade’ massive magnetite ore also allows very efficient liberation of deleterious materials during the beneficiation stage, such that the vanadium-bearing material can be more cost-effectively processed through the salt roast stage.

“Finally, the orebody demonstrates excellent continuity across our project, with outstanding consistency of width and grade, allowing for simple and low-cost open pit mining.”

Global recognition

The aforesaid characteristics of the project has put Technology Metals on the radar of many global investment firms, trading houses, and major users of vanadium – all interested in getting a piece of the action.

For one, Resource Capital Funds is the company’s largest shareholder with more than a 17% corporate stake in the company. BNP Paribas also has a 10% shareholding, which Prentice notes is a nominee under which there are a number of high-net-worth individual shareholders.

He says Resource Capital Funds is a very respected investment firm focused on mining and resources projects and undertakes strong due diligence measures when evaluating potential assets to add to their portfolio. They also take a long-term view of the market and emerging trends globally.

“Vanadium has come on their radar in the last few years as a future-ready mineral with its application in steel and also in vanadium redox flow batteries, which are emerging as the leading contender for long duration energy storage systems.

An investment house like RCF really has their finger on the pulse and is getting in front of the eight ball and investing in those minerals required in significant volumes to meet the global demand for innovative technologies that assist with our transition to renewable energy.  

So, for the MTMP to progress through the rigorous RCF due diligence process and result in a significant investment is a very positive endorsement of the quality of the asset, the team charged with progressing the development of the asset and the development strategy being pursued, including engagement with vanadium customers, vendors, and financiers.”  

Reflecting on the aforesaid global interest, Technology Metals’ development strategy, including engagement with vanadium customers, vendors, and financiers, is based on clearly defined global target markets for its product – steel and batteries.

Tale of two markets

Currently, the vast majority of vanadium is used in China for steel applications, particularly the high-strength, low-alloy steel used to make construction rebar. However, the critical mineral has a growing role in batteries. Vanadium is a key metal used in vanadium redox batteries (VRFBs), which Prentice says a viable option for large-scale storage because they are able to provide hundreds of megawatt hours at grid scale.

Vanadium is a hard, silvery grey, ductile and malleable speciality metal with a resistance to corrosion, good structural strength, and stability against alkalis, acids, and salt water. The elemental metal is rarely found in nature. The main use of vanadium is in the steel industry where it is primarily used in metal alloys such as rebar and structural steel, high-speed tools, titanium alloys and aircraft.

The MD says the addition of a small amount of vanadium can increase steel strength by up to 100% and reduces weight by up to 30%. Vanadium high-carbon steel alloys contain in the order of 0.15-0.25% vanadium while high-speed tool steels, used in surgical instruments and speciality tools, contain in the range of 1-5% vanadium content. Global economic growth and increased intensity of use of vanadium in steel in developing countries will drive near-term growth in vanadium demand.

As mentioned, a very significant emerging use for vanadium is the rapidly developing energy storage (battery) sector with the expanding use and increasing penetration of the vanadium redox flow batteries (VRFBs), the MD explains. VRFBs are a rechargeable flow battery that uses vanadium in different oxidation states to store energy, using the unique ability of vanadium to exist in solution in 4 different oxidation states. VRFBs provide an efficient storage and re-supply solution for renewable energy – being able to time-shift large amounts of previously generated energy for later use – ideally suited to micro-grid to large-scale energy storage solutions (grid stabilisation).

With this in mind, Prentice says the company is in a strong position to capitalise on the burgeoning global vanadium market.

In part 2 of this feature series, the MD explains further how the vanadium market is divided into the aforesaid 2 broad sectors – steel applications and long duration energy storage and how Technology Metals plans to enter each.

the company is in a strong position to capitalise on the burgeoning global vanadium market

“We see steady consistent growth of vanadium consumption in the steel sector particularly as the developing world, including India and Southeast Asia, continues to improve steel quality and therefore increase the use of vanadium per tonne of steel. We see India as a big growth market over the course of this decade as it materially grows its domestic steel production capacity and improves the overall quality of steel it produces a double “whammy” of increased vanadium consumption.

We also see the major growth in vanadium consumption coming in the long duration energy storage sector – with the likelihood that consumption in this sector will exceed that of the steel sector early in the next decade (if not before) – with China already leading the charge on the roll out of some very large VRFBs. 

The MTMP is ideally placed as a developing supplier into this growing market, but importantly as a primary vanadium producer we will also be delivering a very high purity product which will be perfect for the VRFB market.”

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Images: Technology Metals Australia Ltd
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Written By Adam Orlando Editor-in-Chief Adam Orlando has more than 20 years’ experience in the media having held senior roles at various publications, including as Asia-Pacific Sector Head (Mining) at global newswire Acuris (formerly Mergermarket). Orlando has worked in newsrooms around the world including Hong Kong, Singapore, London, and Sydney.