The planned acquisition of the Vametco vanadium mine from Evraz Plc. (LON:EVRE) could, on completion, be a major transformational event for Bushveld Minerals (LON:BMNB). It would move BMN closer to being a fully vertically integrated vanadium explorer-producer-seller. The sale of vanadium in the currently oversupplied market will be greatly supported by BMN’s move into the vanadium redox flow-battery space. Advanced discussions are underway relating to a placing of shares and/or co investment to fund the deal.
Deal brings vanadium production and reserves
The Vametco operation can currently produce 2,750t of Nitrovan (vanadium nitride), Evraz’s proprietary steel hardening ingredient, and also vanadium oxide. Evraz produced 2,419t during 2015. Bushveld states capacity could increase to 3,340t through de-bottlenecking certain plant aspects. The deal also brings 24 years’ worth of compliant reserves (27Mt at 2.55% V2O5 in magnetite), which sit within 135Mt of resource. Vanadium production is currently used in the steel industry, though Bushveld intends to re-configure the plant towards production of vanadium electrolyte used in the vanadium redox flow-battery energy storage market. Bushveld’s move into the energy storage market has gathered pace recently, as it signed an MoU with US company UniEnergy Technologies (UET), announced April 2016, for the development and promotion of redox flow-battery technology.
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