Masoud Abshar is working on plans to expand Magellan Power’s footprint. Photo: Gabriel Oliveira

$150m pipeline for Kwinana battery valley

Monday, 20 May, 2019 - 15:37

About $150 million of non-lithium projects for the battery industry are in the pipeline for Kwinana, with Magellan Power and Pilbara Metals Group the latest proponents.

That adds to work under way already by BHP.

Bibra Lake-based Magellan was founded by Masoud Abshar 28 years ago, and has supplied battery chargers for BHP, Essential Energy, and AGL’s Liddell coal power station.

Magellan also provided batteries for Horizon Power’s Onslow microgrid, and the company now employed 57 people, Mr Abshar said.

He said the company built uninterruptible power supply units in Western Australia already, and wanted to scale up manufacture of battery modules for households and utilities.

Those modules are the complete units installed for customers, with the battery cells inside to be sourced elsewhere, likely through import.

While much focus in the state is on mining and processing of battery minerals, and potentially the manufacture of cathodes, Magellan is at the other end of the battery supply chain, assembling units for end users.

Mr Abshar said he hoped the project would be ‘shovel ready’ by the end of the year.

“There’s a lot of interest (from investors),” he said.

“We already have done it, all we need to do is scale it up.

“We’re not saying we’re going to be making home (or utility-scale) energy, we’ve already made it.

“It’s already working out in the field.”

Perth headquartered Pilbara Metals is planning a $40 million to $50 million manganese sulphate plant in East Rockingham, with an option on 10 hectares of land with Landcorp.

Managing director Rob Mandanici told Business News the facility would process low-grade manganese into manganese sulphate for use in fertiliser, steel and for cathode material in batteries.

Mr Mandanici said there were numerous manganese deposits in WA that had been abandoned or were stranded after a price fall in the past decade.

“The premise of the plant (is) to take a waste product that’s below standard that can’t be sold in the metal or alloy market,” Mr Mandanici said.

“Our target is the marginal or stranded deposits.”

The manganese would be crushed, heated and cooled, and digested with sulphuric acid.

That produces manganese sulphate, which can be processed further using potassium permanganate to produce manganese dioxide for dry-cell batteries.

Output is expected to be about 40,000 tonnes per annum, with hopes production can get under way next year.

To put that in context, Australia imported about 30,000tpa of manganese sulphate for use in fertiliser, Mr Mandanici said.

“We’d love to not only feed the battery market, but also see if we can’t meet the onshore need for fertiliser,” he said.

Lower-grade manganese sulphate for fertiliser sold for about $700 to $1,000 per tonne, he said, while battery grade product usually hits the market at $1,200/t.

The Kwinana region was ideal for such a project, Mr Mandanici said, because although it was further from mine sites, there was access to skilled labour and inputs such as sulphuric acid and lime.

The company is planning to raise $6 million, possibly through a reverse takeover on to the ASX, in coming months, with Barclay Wells appointed as lead manager.

That will pay for permitting, a bankable feasibility study and front-end engineering and design work.

Former Hartleys energy analyst Simon Andrew is chairing Pilbara.

Mr Mandanici has previously served as a director of Auvex Resources, which was acquired by Mineral Resources in 2011, and of Lithex Resources.

Battery boom
Lithium has attracted most of the attention in WA when it comes to battery production, with five refineries in the pipeline and big mine developments such as Talison Lithium’s Greenbushes expansion.

However, Magellan and Pilbara Metals are among a group that show the state has potential outside lithium.

A big example is BHP, which is building a $55 million nickel sulphate processing plant at its Kwinana refinery.

Speaking at an investor conference last week, BHP chief executive Andrew Mackenzie showed how far the pendulum had swung on nickel, revealing the company would keep its Nickel West division after years of considering a sale.

The company’s presentation showed a potential further expansion of Nickel West would be in a high return and higher risk part of its global portfolio compared with other developments such as copper and metallurgical coal mines.