South Africa - Bushveld Minerals, the AIM-listed vanadium company's new pre-feasibility study (PFS) results for its 64% owned Mokopane vanadium project confirm its leading status compared to its project peers.
“Mokopane compares more than favourably with other leading vanadium deposits in the world, and this study defines its importance as a major asset, with strategic significance to the future market for vanadium,” says chief executive Fortune Mojapelo.
“For us, a notable take-away from this study points to its low-cash costs of production and significant market share for the Mokopane project – with run-of mine production contributing ~6% of global annualised vanadium output and ~50 % of South African output, thereby totally repositioning Bushveld Minerals in the vanadium market space.”
The PFS has highlighted the following areas relating to the deposit:
- Massive resource: Ore reserve of 28.56 Mt delineated from total resource of 298 Mt.
- Long-term mine life: 30-year life-of-mine (from less than 10% of the total project resource of 298 Mt).
- Project risk minimised: The proven and established salt roast processing method lowers project risks.
- High-quality product: The PFS suggests a 1 Mtpa run-of-mine operation producing on average 9.525 tpa of vanadium pentoxide flakes at 99.5 weighted percent purity.
- Low cost product: Over the life-of-mine the average combined total cost is estimated at US$3.28/lb V2O5, indicating one of the lowest-cost vanadium producers globally.
- Robust project economics: Pay-back period of four years with a pre-tax NPV of $418 million (based on a 9% base case discount rate) and an IRR of 24.8% (pre-tax) using a conservative long-term US$:ZAR12.75 exchange rate and a real vanadium price of $7.50/lb V2O5 (US$16.53/kg V2O5).
Bushveld hopes to progress the project to the next phase to prove up further value and to reduce residual project risk. The company also hopes to secure a strategic partner to advance the project with.
Says CEO Mojapelo, “We are pleased to present such a positive PFS for the Mokopane vanadium project. The results support our long-held goal to develop this project into a highly profitable, significant contributor to South African and global vanadium market output.”
“With a first quartile cash cost proposition, the project provides precisely the sort of asset we require to pursue our recently announced integrated vanadium development strategy. We have taken a conservative approach in determining the PFS parameters and, in my view, as the global economic environment improves the economics of the project will only get better.”
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