Commodities, Features

The rise of vanadium

Australian Vanadium

With the recent industry focus on sustainability and electrification, critical minerals such as vanadium have increased in prominence.

Vanadium is currently used in high-strength, low-alloy steel and is emerging as a critical battery storage commodity for its use in vanadium redox flow batteries, ideally suited to large, grid-scale storage solutions.

In July last year, the Australian Government announced it is supporting the resources and critical minerals sector with almost $50 million in funding for projects to help grow businesses and create new jobs.

The matched funding from the $1.3 billion Modern Manufacturing Initiative will support eight companies to scale up local downstream processing of critical minerals and add value to the battery and clean technology supply chains.

This will include onshore production of battery storage systems and adoption of battery technology across the mining sector.

At the time, then-Minister for Industry, Science and Technology Christian Porter said Australia was well placed to capitalise on growing global demand for battery systems and the critical minerals associated with their production, with the energy-storage market expected to be worth almost $US20 billion ($27 billion) by 2027.

“Australia’s resource sector is world-class. Through our $1.3 billion Modern Manufacturing Initiative, we are helping to unlock this enormous potential by providing targeted support for projects that will deliver big rewards for our local economy in terms of export earnings and new job opportunities,” Porter said.

“It is also critical that we build our sovereign capability in this sector, with China currently the world leader in critical minerals processing, including battery production.”

“Whether it’s building large-scale battery systems, adding value to critical minerals exports through new refining techniques, or driving the adoption of battery power in mining vehicles, these projects will increase Australia’s international competitiveness and help position us as a future leader in this crucial sector.”

One of the companies that was successful in this initiative was Australian Vanadium, which is using its $3.9 million grant to fast-track manufacturing of large-scale vanadium redox flow battery systems that can be used to support residential power grids.

In November, the Queensland Government recognised the importance of vanadium as a new economy mineral with plans for a processing plant in Townsville.

Queensland Treasurer and Minister for Trade and Investment Cameron Dick says vanadium will play a significant part in the state’s transition to clean energy.

“We want regional Queensland to be a global leader when it comes to everything that’s part of the renewable energy revolution,” he says.

“Australia has the world’s third largest deposits of vanadium resources, but right now we don’t produce a single kilogram of processed vanadium.

“The mining companies looking to process vanadium at an industrial scale don’t have the capital necessary to make that jump. That’s where our government can step in.”

The government will put at least $10 million towards the common-user facility, sourced from the $520 million Invested in Queensland program.

Dick says the government is still in the process of tendering for construction contracts and selecting the location.

“Once producers can see for themselves how processing occurs, they will have the confidence to invest in more manufacturing infrastructure and more jobs,” he says.

“Mining companies will be able to transport ore from their mine site to Townsville, enabling them to begin producing mineral samples at scale.”

Multicom Resources’ $250 million St Elmo vanadium mine in North West Queensland has been given the go-ahead, with construction to begin next year.

Multicom Resources chief executive officer Shaun McCarthy says mine construction is planned to start in 2022, with first production forecast for late 2023.

“The granting of the mining leases associated with the St Elmo project is the most significant milestone achieved by Multicom to date and reflects the tremendous effort from the team over the past four years, with the support of our key partners,” he says.

“The process was smooth and efficient, made possible by the collaborative approach adopted by the company along with the Queensland State Government.”

Mine construction at St Elmo is planned to start this year.

In Western Australia’s Mid West region, Australian Vanadium’s operations are  progressing smoothly near the town of Meekatharra.

Australian Vanadium managing director Vincent Algar says his company’s site has a 25-year mine life, with the aim to produce about 5 per cent of the vanadium’s world market.

The global vanadium market is about 110,000 tonnes of metal equivalent every year, and of that around 60 per cent is produced and consumed in China in the steel industry.

However, both McCarthy and Algar say they are excited at the prospect of the resource being identified as part of the critical minerals sector.

“We got into vanadium before the critical minerals tagline really came to prominence,” McCarthy says.

“We are seeing that critical mineral space heat up both from the demand side, where there is a genuine requirement for more of these products to come to market, but also from a general interest point of view, which includes the Australian Government and other regions around the world in trying to secure the supply chain for various end uses.”

Vanadium redox flow batteries (VRFB) are part of a suite of batteries suited to stationary energy storage applications.

They are non-flammable compared with lithium batteries and have a longer service life of around 20 years — compared with 10 years for lithium batteries — and can discharge 100 per cent of their stored energy. However, they are much heavier per unit, making them more suitable for stationary storage applications.

Two Australian companies are currently assessing VRFB production in Australia.

Australian Vanadium subsidiary VSUN Energy has undertaken a successful test of an electric vehicle battery charge using renewable energy, provided via a VRFB, with the potential of installing the system at mining sites.

The project opens the door for vanadium battery-based standalone electric vehicle (EV) charging stations anywhere in Australia.

VSUN Energy partnered with EV charging hardware and software provider Gemtek Group for the test.

Gemtek Group commercial manager Florian Popp says the company has tested a wide variety of power systems with their EV charging technologies.

“Developing expertise in integrated renewable energy EV charging solutions to suit Australian requirements for mining, agricultural and regional applications has been a key focus for Gemtek,” he says.

“The VSUN Energy storage system’s unique capabilities and operating life provide a substantial advantage in high-temperature and remote environments.”

Australian Vanadium is extracting the mineral from magnetite.

VSUN Energy is currently installing VRFBs into agricultural, commercial, mining and rural residential sites, and is working to develop an urban residential battery for construction in Australia.

According to the company, VRFBs have the capacity to be scaled up to suit a wide range of projects, from residential energy storage through to large grid-scale industrial, mining and agricultural needs.

Algar says this EV charging initiative is part of the company’s strategy to further develop the market for VRFB energy-storage technology in Australia.

“The intent is for Australian Vanadium to not just sell vanadium into the metals sector internationally, but to be fully vertically integrated onshore here in Australia,” he says.

“In doing so, we are able to reduce the cost of these batteries while adding local value, content and job creation.”

The mining and processing project will enter its development phase this year, while a vanadium electrolyte manufacturing facility will be built in parallel near Kwinana in WA.

The electrolyte plant is expected to be in production by mid-2022, with an annual vanadium electrolyte production capacity of 33 megawatt hours (MWh).

In November last year, IGO took another step towards decarbonising its Nova nickel operation in WA, signing an agreement with Australian Vanadium to trial its VRFB standalone power system (SPS).

An SPS typically comprises a combination of solar, wind, battery and backup generation from diesel or gas, and supplies power independently to the electricity grid.

Based on a 300 kilowatt-hour (kWh) VRFB, SPS is designed to provide a 100 per cent renewable energy supply for much of the year, with a diesel genset offsetting any long periods of cloud cover.

The SPS aims to not only significantly reduce the carbon emissions of diesel-generator-powered bore fields, but also offer substantial reductions in operating hours for service personnel.

IGO chief operating officer Matt Dusci says the trial of the SPS forms part of the major miner’s broader net-zero strategy.

“IGO’s strategic focus is on those products that are critical to enabling clean energy solutions, to create a better planet,” he says.

“As part of our strategy to deliver those products, we aspire to be carbon-neutral across our business and to do this, in part, by leveraging renewable energy solutions and innovation to reduce emissions at our remote exploration and mining operations.”

Algar says it is an exciting time for Australian Vanadium, with the company planning to minimise operational costs by overtaking crushing, milling and beneficiation of vanadium-bearing magnetite ore at its mine site, before then transporting the resulting concentrate to its processing plant for final refinement.

“If the demand for vanadium continues on in the steel market and then continues to grow heavily in the battery market, then you have more demand than there can be supply, which should keep prices at a relatively high level,” he says.

“This then means the guys in Queensland can get up, we can get up, and Australia can easily become one of the largest suppliers of vanadium to the world market outside of China.”

“A global market of 110,000 tones is still very small, but it carries a massive weight in terms of its use and what its impact can be.”

This article appeared in the February issue of Australian Resources & Investment.

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