Vanadium Miners News For The Month Of May 2018

|
Includes: AMVMF, APAFF, ATVVF, AUEEF, BSHVF, CCC-OLD, CCCCF, CECBF, LGORF, PCY, PNTZF, PRPCF, RDRUY, RRSSF, SRHYY, SYAAF, UUUU
by: Matt Bohlsen
Summary

China Vanadium spot prices were slightly lower in May.

Vanadium market news - Vanadium: A perfect metal market.

Vanadium company news - Triton to fast track vanadium study at Nicanda Hill vanadium resources 1.44 billion tonnes. Aura Energy reports 90 million tonne Vanadium Zone at Haggan.

Welcome to the Vanadium miners news. Vanadium is traditionally used to harden steel; however, Vanadium Redox Flow Batteries [VRFBs] are becoming increasingly popular especially for commercial energy storage, most notably in China. China has an enormous amount of solar and wind capacity that blend perfectly with this type of energy storage.

Vanadium oxide spot price history

The type of vanadium used in energy storage applications is vanadium pentoxide. Due to the recent V2O5 deficit, and the very recent boom in vanadium flow batteries, especially in China, vanadium pentoxide [V2O5] prices have been rising.

China Vanadium Pentoxide [V2O5] Flake 98% Price - USD 13.90/lb

Source: Vanadiumprice.com

Vanadium redox flow battery schematic

Related image

Source

Vanadium demand versus supply

Demand

  • Steel production (used to harden steel). Recent China regulations requiring stronger steel rebar, hence more vanadium required.
  • Vanadium redox flow batteries (used mostly for large-scale energy storage in China).

Supply

  • Most supply currently comes from China, Russia, South Africa, and Brazil.
  • Supply has been decreasing the past few years for several reasons.

Vanadium demand forecast to outstrip supply 2018-2025

Source: Largo Resources Investor presentation

Vanadium market news

In 2017, Robert Friedland stated:

"We think there's a revolution coming in vanadium redox flow batteries," he says. "You'll have to get into the mining business and produce ultra-pure vanadium electrolyte for those batteries on a massive scale. We're very deeply interested in how you store electrical energy in the grid. The beauty of the vanadium redox battery is that you can charge and discharge it at the same time, something that can't be done with a lithium battery. With a vanadium redox flow battery, you can put solar power and wind power into the battery, and you can put excess grid power into the battery at night, and at the same time you can have a stable output into the grid."

Note: Robert Friedland is a chairman of Beijing company Pu Neng. Last November 2017 Pu Neng was awarded a contract to build the largest vanadium flow battery in China. That is the 40MWh project referred to above, that will be followed by a larger 100MW 500MWh energy storage project in Hubei Province.

On May 2, Mining News reported:

"Vanadium steels itself for future demand. If you take a hard look at vanadium, some of the same growth drivers as for cobalt and lithium are evident. But despite growing interest in large-scale vanadium redox flow batteries, it's unlikely speculators will manage cobalt-level returns off the metal. Still, there are promising signs for vanadium."

On May 17, Investor Chronicle reported:

"The vanadium price more than doubled, on top of a 72 percent climb in 2016, amounting to a five-fold increase between November 2015 and April this year. Despite this, there are reasons to believe that the vanadium price will continue to rise, irrespective of the market's history of sudden spikes and violent drops. Interestingly, this is a view broadly held by mining analysts and producers alike. Asked why things will be different this time, they cite two excellent drivers of long-term demand, and a long list of structural impediments to supply."

On May 28, Investing News reported "4 Top Vanadium-producing countries" in 2017. China was number 1 with 43,000 MT, Russia was number 2 with 16,000 MT, South Africa number 3 with 13,000 MT, and Brazil number 4 with 8,400 MT.

Vanadium miner news

Vanadium producers

AMG Advanced Metallurgical Group NV [NA:AMG] [GR:ADG] (OTCPK:AMVMF)

AMG Vanadium is a leading provider of products and services for the metals, manufacturing, refinery and petrochemical industries. AMG Vanadium produces ferrovanadium and related ferroalloys from spent refinery catalysts using our proprietary pyrometallurgical process. Spent hydroprocessing catalysts represent an environmental problem for many refiners. Disposal in a landfill does not eliminate the long-term environmental hazards and legal responsibility associated with this material. Catalyst disposition through conversion to another material is a solution that offers important ecological and cost-saving benefits to the refiner's stakeholders, to the community-at-large and to our environment.

On May 2, AMG announced,

"AMG Advanced Metallurgical Group N.V. reported first quarter 2018 revenue of $308.4 million, a 20% increase from $258.0 million in the first quarter 2017. EBITDA for the first quarter 2018 was $44.5 million, a 35% increase from $33.0 million in the first quarter 2017. Net income attributable to shareholders increased 18% to $18.4 million in the first quarter 2018 from $15.6 million in the first quarter 2017."

You can view the latest investor presentation here.

Bushveld Minerals Limited [LN- AIM:BMN] (OTC:BSHVF)

Bushveld is a diversified AIM-listed resources company with a portfolio of vanadium, tin and coal assets in Southern Africa and Madagascar. Bushveld Minerals 100% own Bushveld Vametco Limited which has a controlling interest of 59.1% in an existing low cost production platform, Vametco Alloys, with ~3.5% of global market share. Quality brownfield processing infrastructure in close proximity to Bushveld deposits.

On May 4 Mining MX reported,

"Bushveld Minerals pegs hopes on energy to drive vanadium demand. But vanadium's - and Bushveld's - prospects lie not only in Shanghai's skyscrapers. Bushveld Minerals CEO, Fortune Mojapelo, said in a webinar on Thursday that the group is also pegging its ambitions on Vanadium Redox Flow Battery (VRFB) technology."

You can view the latest investor presentation here.

Energy Fuels Inc. [TSX:EFR] (UUUU)

Energy Fuels state they are "the #1 uranium producer in the U.S. with market-leading portfolio." The company produced 259,000 lbs of uranium in 2017. Regarding vanadium, the company state they have "32M lbs M&I vanadium resources at La Sal & Whirlwind Mines (1% avg. grade)." In 2013, the company produced 1.5M lbs of V2O5, and due to the price recovery, they are evaluating several near-term production opportunities.

On May 3, Energy Fuels announced, "Energy Fuels announces Q1-2018 results." Highlights include:

  • "At March 31, 2018, the Company had $23.6 million of working capital, including cash and cash equivalents of $6.6 million and approximately 600,000 pounds of uranium concentrate inventory.
  • 50,000 pounds of U3O8 sales were completed by the Company at a realized price of $24.75 per pound, pursuant to a contract.
  • Q1 had lower sales volume due to the timing of contract sales. On April 1, 2018, the Company delivered 400,000 lbs. into long-term sales contracts at the price of $61.30 per pound, and over $24.5 million was collected on May 1, 2018. In addition, the Company collected $5.39 million from the sale of a non-core property on May 1, 2018.
  • $1.2 million of total revenue was realized by the Company during the quarter.
  • Uranium production totaled 43,000 pounds of U3O8 during the quarter.
  • The Company began fulfilling toll processing alternate feed contracts which are expected to result in approximately $7.1 million of revenue for 2018, including $3.8 million of cash and $3.3 million of uranium for the Company's account, none of which have been earned or recovered to date."

On May 8, Energy Fuels Inc. announced:

"A leading uranium producer in the U.S. is pleased to announce that it intends to resume vanadium recovery operations in 2018, and it expects to recover significant quantities of currently dissolved vanadium (as V2O5) from pond solutions at the Company's White Mesa Mill (the "Mill"). Vanadium prices have risen by more than 400% over the past 24 months to about US$15 per pound V2O5. Based on extensive test work and laboratory analysis, the Company has identified significant concentrations of dissolved vanadium in pond solutions at the Mill, ranging between 1.4 and 2.0 g/L. Based on current estimates, the Company believes these pond solutions, which result from past mineral processing campaigns at the Mill, may contain over four (4) million pounds of recoverable vanadium (as V2O5)."

You can view the latest investor presentation here.

Largo Resources [TSX:LGO] [GR:LR81] (OTC:OTCQB:LGORF)

Largo Resources is a pure play vanadium pentoxide producer from their Maracás Menchen mine in Brazil. The company state,

"the Maracás Menchen mine possesses the world's highest grade vanadium deposit - P&P reserve grade of 1.17% V2O5 is over double the industry average. On track to be one of the lowest cost producers of vanadium, and a 6 year take or pay off-take agreement with Glencore for 100% of production."

On May 7, Largo Resources Ltd. announced:

"First quarter net income of $45.8 million and earnings per share of $0.09. Revenues of $91.0 million in Q1 2018, a 210% increase over Q1 2017. Total production of 2,214 tonnes of V2O5 in Q1 2018, a 7% increase over Q1 2017. Average V2O5 price of ~US$13.60/lb V2O5 in Q1 2018. Cash balance at March 31, 2018 of $50.2 million and restricted cash of $4.4 million."

On May 17, Largo Resources Ltd. announced:

"The successful, same-day launch and pricing of its private note offering totaling US$150.0 million in aggregate principal amount. Such senior secured notes are due in 2021, callable in years 2 and 3, and carry a coupon of 9.25% (the "Offering")."

On May 22, Largo Resources announced:

"Largo Resources Ltd. announces the closing of its private placement offering of US$150 million (the "Offering") aggregate principal amount of senior secured notes due in 2021 (the "Notes"). The Notes are callable in years 2 and 3, and carry a coupon of 9.25%."

On May 29, Largo Resources announced:

"Largo Resources Ltd. is pleased to announce that the Company has been upgraded from the OTCQB® Venture Market and will commence trading on the OTCQX® Best Market ("OTCQX") under the symbol LGORF effective immediately. The Company's common shares will continue to trade on the Toronto Stock Exchange under the symbol LGO."

You can view the latest investor presentation here.

Vanadium developers

Aura Energy [ASX:AEE] [GR:VU1] (OTC:AUEEF)

Aura Energy is an Australian-based minerals company that 100% owns polymetallic and uranium projects with large resources in Sweden (Häggån Project) and Mauritania (Tiris project). Aura's focus is on the Häggån Project, located in Sweden's Alum Shale Province, one of the largest depositories of vanadium in the world.

On May 1, Aura Energy Limited announced:

"Aura Energy Limited is pleased to advise that it has commissioned additional orebody modelling work on the Häggån deposit as part of its vanadium and Battery Metals development program."

On May 23, Aura Energy announced:

"High grade vanadium zone defined. The orebody modelling, which confirmed the Global Resource of 15.1 Billion lbs V2O5, was also designed to review the potential for higher grade vanadium zones in the Häggån deposit at a range of cut-off grades. At a 0.1% V2O5 cut-off the Häggån Inferred Resource contains approx. 15.1 billion pounds V2O5. At a cut-off grade of 0.4% V2O5 the resource contains approx. 90 million tonnes at an average grade of 0.42% V2O5, containing 840 million lbs of V2O5. Of particular interest within this 90 million tonnes is the definition of a coherent and large zone of mineralisation of 49million tonnes at +0.4% vanadium pentoxide commencing at a depth of 20 metres below surface and extending to around 100 metres below surface."

You can view the latest investor presentation here.

Australian Vanadium [ASX:AVL] [GR:JT71] (OTC:ATVVF)

Australian Vanadium is an emerging vanadium producer focused on the Gabanintha deposit in Western Australia.

On May 22, Australian Vanadium announced:

"Australian Vanadium could potentially add cobalt to its planned production at its flagship Gabanintha vanadium project in Western Australia after metallurgical test work produced up to 2.02% cobalt in a sulphide concentrate."

You can view the latest investor presentation here, or read "Australian Vanadium Managing Director Vincent Algar Talks With Matt Bohlsen Of Trend Investing."

King River Copper [ASX:KRC]

King River holds 785 square kilometres of mineral leases covering a unique geological feature in the Eastern Kimberley of Western Australia, called the Speewah Dome. The company state on their website: "The focus of King River Copper Limited is the exploration for Gold, Silver and Copper." However, their deposits also contain vanadium.

No significant news for the month.

You can view the latest investor presentation here.

Neometals [ASX:NMT] (OTCPK:RDRUY) (OTCPK:RRSSF)

Neometals is primarily a lithium producer however they 100% own the Barrambie Titanium Vanadium Iron Project in Western Australia. Barrambie's Eastern Band is one of the highest grade hard rock titanium deposits globally.

On May 8, Neometals announced,

"Neometals Ltd. is pleased to report the collection and dispatch of a 53‐tonne bulk sample from the Barrambie Titanium Vanadium deposit. The sample targeted typical high‐grade Titanium and Vanadium mineralisation from the Eastern Band of the deposit which has the potential to be the main feed source for a potential Direct Shipping Ore ("DSO") operation."

Highlights include:

"Bulk sample mining and collection complete and ready for shipping to China.

Metallurgical test work program at leading Chinese research institutes planned to produce concentrates before smelting to produce titanium and vanadium slags.

11 tonne bulk sample retained to provide feedstock for Australian laboratory test program collected."

On May 25, Neometals announced,

"Neometals declares 1 cent unfranked dividend. Consistent with the Company's commitment to deliver shareholder value and returns, Neometals Ltd is pleased to advise that the Board has declared an unfranked dividend of 1 cent per share (approximately A$5.4m in total). This 1 cent dividend represents the third consecutive dividend payment made by Neometals in as many financial years. After the current payment date, total dividends to shareholders will amount to ~$27.9 million. In addition, Neometals has recently concluded on market share buy‐back program under which ~$6.2 million worth of shares were bought back by Neometals."

You can view the latest investor presentation here, or read "Neometals Managing Director Chris Reed talks with Matt Bohlsen of Trend Investing."

Prophecy Development Corp. [TSX:PCY] (OTCQX:PRPCF) (PCY)

Prophecy Development Corp. is a Canadian public company listed on the Toronto Stock Exchange. Prophecy's objective is to advance Gibellini Black Shale primary vanadium project in the battle mountain region in North Eastern Nevada USA to production. Gibellini aims to be the first active primary vanadium mine in North America.

On May 9, Prophecy Development Corp. announced:

"Prophecy Development Corp. is pleased to announce the submission of its Management's Plan of Operations (the "MPO") for the Gibellini vanadium project (the "Gibellini Project") to the United States Department of the Interior, Bureau of Land Management, Mount Lewis Field Office (the "BLM") and the Reclamation Permit Application to the Nevada Division of Environmental Protection, Bureau of Mining Regulation and Reclamation (the "BMRR"). The MPO was prepared by SRK Consulting (U.S.) Inc. with over 1,100 pages of detailed development plans for the open pit mining operations and processing facilities to extract and recover vanadium from the Gibellini Project with stated average mine production during the seven-year mine life of 15.7 million tons of ore material containing 120.5 million pounds of vanadium."

On May 29, Prophecy Development Corp. announced,

"Prophecy's Gibellini vanadium project shows US$415 million after-tax NPV and 57% IRR at today's vanadium price. Prophecy Development Corp. is pleased to announce the results of a positive preliminary economic assessment study (the "PEA") for its Gibellini vanadium project, designed to be an open pit, heap leach operation in Nevada's Battle Mountain region, about 25 miles south of the town of Eureka. The PEA reported an after tax cumulative cash flow of $601.5 million, an internal rate of return of 50.8%, a net present value of $338.3 million at a 7% discount rate and a 1.72 years payback on investment from start-up assuming an average vanadium pentoxide price (V2O5) of $12.73 per pound. As of May 29, 2018, the price of vanadium pentoxide is $14.20 per pound."

You can view the latest investor presentation here.

Syrah Resources [ASX:SYR] (OTCPK:SYAAF) (OTC:SRHYY)

Syrah Resources is primarily a graphite producer recently commencing graphite production from their massive Balama mine in Mozambique. The company also has discussed plans to produce vanadium.

On May 23, 4-traders reported,

"Syrah Resources: Signs BAM site purchase agreement. Syrah Resources Limited is pleased to announce that it has signed a purchase agreement for an industrial site for its Battery Anode Material (BAM) development in Vidalia, Louisiana. This is the next step following the Letter of Intent previously announced (refer to ASX Quarterly Update on 30 April 2018)."

You can view the latest investor presentation here.

Tando Resources [ASX:TNO]

Tando Resources is a junior exploration company established with the purpose of exploring and developing gold zinc, lead, copper and other mineral opportunities. Tando recently signed a HoA to acquire 74% of a globally significant vanadium project, the SPD Project, in Gauteng Province, South Africa.

On May 7 Tando Resources announced, "High grade results from SPD vanadium project." Highlights include:

  • Surface samples outside resource area return whole rock results with V2O5 contents > 2%.
  • High grade results from magnetite "pipes" comprised of almost 100% magnetite, occurring separately from the mapped and drilled vanadiferous titanomagnetite layers (which average 0.78% V2O5).
  • Further investigations to be carried out into the magnetite pipes to determine their potential to add value to the SPD Vanadium Project.
  • Due diligence on SPD Project acquisition nearing completion."

On May 21, Tando Resources announced:

"Exploration on high grade pipes commences at SPD vanadium project. Ground magnetic survey to commence following identification of further magnetite "pipes" at the SPD Vanadium Project."

You can view the latest investor presentation here.

Technology Metals Australia [ASX:TMT]

The company's primary exploration focus is on the 100% owned Gabanintha Vanadium Project located 40km south east of Meekatharra in the mid-west region of Western Australia.

No significant news for the month.

Catalysts include the PFS in June 2018, and a DFS by April 2019, and a possible 12ktpa producer by late 2020 or 2021. You can view the latest investor presentation here, or read "Technology Metals Australia Executive Director Ian Prentice Talks With Matt Bohlsen Of Trend Investing."

TNG Ltd. [ASX:TNG] [GR:HJI] (TNGZF)

TNG is an Australian resources company focused on the evaluation and development of its Mount Peake Vanadium-Titanium-Iron project. The Mount Peake Project is located 235km north-northwest of Alice Springs in the Northern Territory of Australia. TNG Ltd is well advanced with a massive $4.7b NPV 8%, but relies on titanium and iron with a lower grade vanadium by-product.

On May 15, TNG announced:

"Federal Government environmental approval granted for the Mount Peake Vanadium-Titanium-Iron Project under the Environment Protection and Biodiversity Conservation Act 1999."

You can view the latest investor presentation here.

Triton Minerals [ASX:TON] [GR:1TG]

Triton Minerals plans to be a graphite producer with their flagship Ancuabe Graphite Project in Mozambique by H2, 2019. They also have the Nicanda Hill project which the company states is the "world's largest graphite resource" and also contains plenty of vanadium. Their third graphite project is Nicanda West. Triton is primarily a graphite play, but with significant vanadium potential.

On May 8, Triton Minerals announced:

"Triton Minerals Limited is pleased to advise that its fully underwritten non-renounceable entitlement offer, announced on 16 March 2018 (Entitlement Offer), has successfully completed with funds of $4,172,800 (before costs), raised at $0.08c per share, having been received by the Company. The funds raised will enable to Triton to ramp up development activities at the Ancuabe Project and accelerate the review of the vanadium development potential of the Nicanda Hill Graphite-Vanadium Project."

On May 23, Triton Minerals announced:

"Triton to fast track studies of globally significant Nicanda Hill vanadium resources 1.44 Billion tonnes at 0.29% V2O51."

Highlights include:

  • "Globally significant vanadium deposit - 1.44 billion tonnes at 0.29% V2O51 - Tier one resource with minimal mining costs due to processing of graphite tailings.
  • CSA Global study confirms potential of the shallow, upper zone of the deposit.
  • Testwork planned to identify processing options for vanadium concentrate
  • Studies are complementary to both the Ancuabe and Nicanda Hill graphite projects and provide regional synergies."

You can view the latest investor presentation here.

Battery Minerals [ASX:BAT]

Battery Minerals is a multi-commodity battery materials provider focused on the development & integration of minerals critical to the battery market & energy storage sector. The Company is maintaining a focus on its two graphite development assets Montepuez and Balama which are located in Mozambique, and also has vanadium.

On May 3, Battery Minerals announced, "Battery Minerals agrees terms of US$30m debt & equity funding package with RCF."

Highlights include:

  • "Term sheet signed for US$25m term loan and US$5m equity.
  • US$25m term loan is for 3 years at an interest rate of 10%pa.
  • RCF to subscribe for US$5m (~AUD$6.7m) in proposed placement.
  • Proceeds will be used for construction of the Montepuez graphite project."

On May 17, Battery Minerals announced,

"Battery Minerals raises $20m to continue building Montepuez Graphite Project. Battery Minerals has received commitments for $20m via a share placement at 6c per share. Proceeds will be used to continue construction of the Montepuez Graphite Project in Mozambique, where commissioning and first shipment are planned for Q1 CY 2019 and Q2 CY 2019 respectively. Securities Purchase Plan (SPP) to be completed in June 2018, providing eligible shareholders with opportunity to participate in capital raising."

You can view the latest investor presentation here.

VanadiumCorp Resource Inc. [TSXV:VRB][GR:NWN] (OTCPK:APAFF)

VanadiumCorp Resources Inc. 100% owns the Lac Dore Vanadium-Iron-Titanium project in Quebec Canada. The NI 43-101 vanadium resource estimate is 99.1Mt @ 0.43% V2O5 (Inferred), or 1.08% V2O5 in magnetite concentrate. Mineralization is at surface and open at depth and along strike. The Company also has another smaller project known as the Iron-T Vanadium Project also in Quebec, and royalties on the Raglan Nickel-PGM mine. The Company is looking to take a vertically integrated approach. They are also developing leading process technologies 'VanadiumCorp-Electrochem Processing Technology' and 'Electrochem globally patented Electrowinning' technology.

On April 3, VanadiumCorp announced plans to re-file an amended PEA technical report for its Lac Dore Project in the next 60 days (by early June 2018).

Other vanadium juniors

  • NextSource Materials [TSX:NEXT]
  • Cellcube Energy Storage [TSXV:CUBE] (OTCQB:STNUF) (formerly) Stina Resources Ltd [CSE:SQA] (STNUF)
  • Golden Deeps [ASX:GED]
  • Sabre Resources [ASX:SBR]
  • Trigon Metals Inc. [TSXV:TM] (OTC:PNTZF)
  • Venus Metals [ASX:VMC]
  • Cornerstone Metals Inc. [TSXV: CCC] (OTCQB:CCCCF)
  • Intermin Resources [ASX:IRC]

Conclusion

The vanadium price fell slightly the past month after a terrific rise over the past 6 months.

My highlights for the month include:

  • AMG's 35% increase in EBITDA for the past quarter.
  • Australian Vanadium could potentially add cobalt to its planned production.
  • Prophecy Development Corp. strong PEA result of an after-tax NPV of US$415 million and an IRR of 57%.
  • TNG Limited achieves environmental approval for its Mount Peake Vanadium-Titanium-Iron project in the Northern Territory of Australia.

As usual, all comments are welcome.

Disclosure: I am/we are long SYRAH RESOURCES [ASX:SYR], TRITON MINERALS [ASX:TON]NEOMETALS {ASX:NMT],LARGO RESOURCES [TSX:LGO], TECHNOLOGY METALS AUSTRALIA [ASX:TMT].AUSTRALIAN VANADIUM [ASX:AVL]. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: The information in this article is general in nature and should not be relied upon as personal financial advice.

Editor's Note: This article covers one or more microcap stocks. Please be aware of the risks associated with these stocks.