Surefire tables $1.7b vanadium play in WA

Surefire Resources has unveiled a pre-tax net present value of $1.7 billion for its Victory Bore vanadium project in Western Australia’s Mid West region following the release of a prefeasibility study (PFS) into the operation.

Based on standard open-cut mining methods, the company is predicting a notable 42.2 per cent pre-tax internal rate of return, a mine life of 24 years with a payback of 2.4 years and a capital cost of $767 million.

The study follows a pivotal memorandum of understanding (MOU) with the Kingdom of Saudi Arabia (KSA) – through that nation’s Ministry of Investment Saudi Arabia (MISA) – where it plans to process ore from Victory Bore.

Surefire has also released an updated mineral resource estimate for the Mid West project of 465 million tonnes at 0.3 per cent vanadium oxide, 5.1 per cent titanium dioxide and 17.7 per cent iron. The figure includes 16.4 per cent aluminium oxide and 36.2 per cent silicon oxide.

The latest resource builds on the previous estimate of 234.8 million tonnes at 0.39 per cent vanadium oxide. A maiden probable ore reserve of 93 million tonnes grading 0.35 per cent vanadium oxide, 5.2 per cent titanium oxide and 19.8 per cent iron was also released.

The company says it has also opened discussions with Saudi-based companies showing interest in becoming partners in the KSA processing operation and plans to further the dialogue at next month’s Future Minerals Forum in Riyahd.

Surefire Resources managing director Paul Burton said: “This is an outstanding result for our world class critical minerals project and shows that in the current economic environment, offshore processing is the right approach to getting this project into development and production. We look forward to taking this project forward, completing the next significant milestones and engaging with KSA companies interested in being part of our project and development.”

Management based the PFS on producing about 1.25 million tonnes per year of high-quality vanadium-titanium magnetite concentrate at the WA mine site, with a view to producing up to six products from the concentrate in KSA. It will include yearly production of 2580 tonnes of high-purity vanadium, 5760 tonnes of ferrovanadium, 192,880 tonnes of titanium slag, 364,480 tonnes of pig iron, 245,480 tonnes of high-purity iron oxide pigment and 245,480 tonnes of high-grade iron ore.

Concentrates are expected to be bulk shipped to the KSA for downstream processing into final high-value end products. Management says processing in KSA has significant advantages, with lower operating and capital costs in addition to close proximity to markets. The KSA Government has proposed downstream processing to be located in one of the industrial hubs specifically designated for ferro-alloy processing.

The steel industry in KSA currently accounts for about 90 per cent of the kingdom’s total vanadium demand, where the silvery-grey metal is used as an additive to reduce the end-product alloy’s sensitivity to overheating and increases its strength and toughness to make it an ideal structural steel.

Surefire has its eye on selling vanadium to both the mineral’s traditional steel market, in addition to the emerging vanadium redox battery market. Vanadium batteries have been found to handle more charge cycles, are easily expandable at little extra cost, are safer and have a lower decay rate than lithium-ion batteries, making them ideal for large-scale storage applications.

Earlier this year, the company also confirmed it had produced the high-purity aluminium (HPA) standard known as “4N” – referring to the four nines in the 99.99 per cent purity measurement obtained at the end of processing a feedstock ore of about 24 per cent aluminium oxide.

The product plays a critical role in the manufacture of lithium-ion batteries, which rely on 4N HPA for the essential ceramic coatings on the separators that are placed within the battery between the cathodes and anodes. HPA provides excellent thermal insulation that greatly improves safety, charging efficiency, high-power output capability and battery life.

So, management now believes its PFS sets out a more robust and economic case for it to develop the Victory Bore deposit, with the production of multiple resources expected to significantly lower the investment risk.

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