Vanadium Resources Limited Signs Additional Offtake Agreement With Vanadium Pentoxide Producer

Vanadium Resources Limited (ASX: VR8) has signed another agreement to sell vanadium pentoxide (V2O5) produced from its Steelpoortdrift Vanadium Project in the Bushveld Complex in South Africa.

The agreement highlights the continuing strong demand from China for reliable sources of vanadium supply.

The offtake MoU for the future supply of 4ktpa of V2O5 flake is with Enerflow Technology Co., Ltd, a subsidiary of Tian’en Energy Co., Ltd over five years.

About the project

Steelpoortdrift is one of the world’s largest and highest-grade vanadium deposits.

It boasts a Mineral Resource of 680Mt at 0.70% V2O5 and a total Ore Reserve of 77Mt at 0.72% V2O5.

The Steelpoortdrift Vanadium Project comprises the Steelpoortdrift Mine and Concentrator and the planned Tweefontein Salt Roast Leach operation.

A DFS revealed a Cash cost of US$3.24/lb V2O5 that places the Project within the lowest quartile of the international cost curve for vanadium pentoxide.

The start-up capital expenditure is estimated at US$211 million.

The MOU is non-binding but provides a framework for further negotiations about price, product quality, and other offtake parameters including an option to extend the agreement.

It reresents a new source of vanadium demand from the growing global energy storage market including Vanadium Flow Batteries.

This is in addition to the continuing demand for vanadium from the steel & alloy market.

About Tian’en Energy

Founded in 1986 with headquarters in Beijing, the company is primarily focused on the photovoltaic, wind power, and energy storage sectors.

Its services, include the construction and operation of power stations, for the photovoltaic, wind power, gas power generation, and cogeneration sectors.

Previous offtake agreement

Similar to the recently announced MOU with Panjin Hexiang New Materials Technology Co., Ltd for 4ktpa V2O5 flake.

Together, the MOUs of Hexiang and Enerflow represent 8ktpa or about 73% of the 11ktpa V2O5 production planned for Steelpoortdrift’s Phase 1 operations.

The company said it is in discussions for further offtake MOUs and agreements with a variety of Chinese, Japanese, Korean, and European end-users and traders for the balance of its planned production.

The company held cash of $4.1 million on 31 December 2023.




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