Last week, Neometals announced the completion of a cost study on the Vanadium Recovery Project in Finland.  

Neometals has the option to enter into a 50:50 incorporated joint venture to develop a vanadium recovery project with unlisted Australian mineral development company, Critical Metals.  The parties are jointly evaluating the feasibility of constructing a facility in Pori, Finland, to process and recover high-purity vanadium pentoxide from vanadium-bearing steel-making slag generated by SSAB in Scandinavia. 

In April 2020, Critical Metals executed a ten-year slag supply agreement with Scandinavian steel giant SSAB to access approximately 2Mt of stockpiled high-grade vanadium-bearing slag from three operating steel mills.  These are in Oxelösund and Luleå in Sweden and Raahe in Finland.  The SSAB stockpile in Luleå is ~4% V2O5 and at both Oxelösund and Raahe is ~3% V2O5.

A 2021 PFS envisaged production of 6,091tpy vanadium pentoxide from 200ktpy throughput, with CAPEX at US$183M and an operating cost estimate of US$4.25/lb V2O5.  The 2022 study envisages the production of 8,642tpy vanadium pentoxide from 300ktpy throughput, representing an increase from a 2021 PFS.  The CAPEX estimate has also increased (to US$341M including 15% contingency) while the operating cost estimate has increased to US$4.38/lb V2O5.   Project Blue notes that this makes the project’s operating costs competitive with existing primary producers.

The vanadium market is currently well balanced although various demand and supply-side factors could help push the market into surplus or deficit over the next five years.  Project Blue’s view is new sources of supply will be required after the middle of the decade.  This new supply will come from primary, secondary or co-producers, with both existing players and new operators looking to bring new projects into production.  While its CAPEX is higher than some other advanced vanadium projects, the Vanadium Recovery Project –located in Europe, with no requirement for a mine and concentrator – is well placed to be one of these new operators.