Australian Vanadium revises PFS financial metrics, targets 2021 production

Date: Mar 22, 2019

The company’s flagship project has a US$616 million value at a US$13 per pound vanadium price.

A DFS for The Australian Vanadium Project is expected in December 2019, targeting cost reductions from a December 2018 PFS
The project has an initial 17-year mine life
At a US$13 per pound vanadium price, the project has an NPV8 value of US$616 million ($860 million)
The corresponding internal rate of return is 27.2% while fully allocated C3 costs are $6.05 a pound
Australian Vanadium hopes to start construction in 2020-21 and be in production with the namesake project in 2021
Start-up, commissioning and ramp-up is tipped to happen over 2021-22

What does Australian Vanadium do?

Australian Vanadium Ltd (ASX:AVL) (FRA:JT71) (OTCMKTS:ATVVF) specialises in vanadium exploration and development in Western Australia. It is run by Vincent Algar, a geologist and former investment analyst with more than 25 years of experience in the resources and mining services industries. Algar previously headed up a manganese exploration company spun out of the Hancock Prospecting Pty Ltd buy-up Atlas Iron Limited (ASX:AGO).

What does Australian Vanadium own?

The company’s key asset is The Australian Vanadium Project about 43 kilometres south of the mining town of Meekatharra and 740 kilometres northeast of Perth.

Australian Vanadium holds vanadium, uranium, cobalt, chromium, titanium, lithium, tantalum, manganese and iron ore rights to its now 260 square kilometre project.

AVL’s maiden ore reserve was 18.24 million tonnes at 1.04% vanadium pentoxide (V2O5), comprising a proved reserve of 9.82 million tonnes at 1.07% and a probable reserve of 8.42 million tonnes at 1.01%.

The resource is 183.6 million tonnes grading 0.76% V2O5, the company confirmed this week in a corporate presentation released to the market on Tuesday, March 19, with a high-grade segment of 96.7 million tonnes at 1% V2O5.

Australian Vanadium expects to be able to produce a high-purity V2O5 powder for superalloys and energy storage.

The company controls an 11-kilometre resource strike length of the Bushveld-type vanadium titano-magnetite (VTM) deposit, with the mine plan based on 2.5 of those kilometres.

AVL said in the corporate update “significant potential to improve project economics” had been identified and was being investigated actively for a “well-defined ore body (with a) well-understood processing route”.

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