ASX-listed manganese producer in waiting, Element 25 has wasted no time in laying the foundations for a “stage two” development at its new Butcherbird manganese mining and beneficiation operation in WA. The Perth-based company has just squared away a capital raise worth $35.5 million that it says will largely go towards a planned expansion of Butcherbird’s annual manganese concentrate output from about 365,000 tonnes to more than one million tonnes a year.
The Butcherbird project, located approximately 130 kilometres south of Newman in the southern Pilbara region, is currently in the wet commissioning stage with first ore processing set to commence shortly.
Late last year, Element 25 tabled a bumper revised pre-feasibility study on Butcherbird that pointed to operating cash flows of $39.6 million a year before tax for the first five years of manganese concentrate production at the “stage one” output level of 365,000 tonnes per annum.
Pre-production CAPEX for the project development stands at a staggeringly low $17 million and the capital payback period at a mere six months.
Latest published proved and probable ore reserves for Butcherbird are 50.55 million tonnes at an average grade of 10.3 per cent manganese for 5.22 million tonnes of contained manganese.
Only 10 months has elapsed between Element 25 putting out its original pre-feasibility study on Butcherbird and reaching the current commissioning phase.
Element 25 Managing Director, Justin Brown said: “To deliver a mining project in such a short time frame whilst maintaining a high level of safety and cost control is a fantastic achievement by the team. This is an important first step in the development of the project which can then be expanded into the battery metals markets.”
Element 25 says the latest capital raise will also enable it to accelerate work on completing the flow sheet and plant design relating to the possible production of lithium-ion battery-grade manganese sulphate from the concentrate produced at Butcherbird for electrical vehicle batteries.
According to the company, manganese has emerged as an increasingly important ingredient for electric vehicle batteries given potential supply constraints of nickel and cobalt may prompt battery manufacturers to look at manganese cathodes to produce the vast amount of cathode material needed by the EV industry in coming years.
Element 25 says Butcherbird is ideally placed to feed the potential demand, with flow sheet development work undertaken over the past couple of years indicating Butcherbird ores are amenable to “a simple, unique, ambient temperature and atmospheric pressure leach process”.
Interestingly, Element 25 is starting to attract international interest now with a leading Swiss ESG fund putting some money into the latest raise.
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By Matt Birney
