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MINING | Bushveld Minerals
BUSHVELD MINERALS
The vertically integrated primary vanadium producer
Resource Global Network
MINING | Bushveld Minerals
The rapid rise of Bushveld Minerals in the global mineral development space has been a remarkable sight to behold, given that it has developed into one of only three operational primary vanadium producers in the world despite only being incorporated in January 2012. Two months later Bushveld was listed on London’s AIM as a mineral development company focused on exploring and developing projects in South Africa’s Bushveld Complex. Today the company owns three high grade vanadium assets, one already in production and two under development, which provide a total resource base of 440 million tonnes (Mt). Bushveld currently supplies around 3,000 Mt of vanadium from its Vametco mine - representing 3% of the global vanadium market. With expansion plans underway at Vametco plus targeted brownfield opportunities, Bushveld aims to expand its Group production to 10,000 Mt in the medium term. The company consists of two flagship platforms: Bushveld Vanadium and Bushveld Energy. The former is a growing, low cost,
Resource Global Network vertically integrated primary producer which manages the three vanadium assets in the Bushveld Complex. The latter is a leading energy storage project developer and component manufacturer, exclusively focused on Vanadium Redox Flow Batteries (VRFB) technology. “Bushveld Energy was accordingly launched in 2016, to capture a share of this attractive market,” says Bushveld’s CEO Fortune Mojapelo. “Bushveld Energy’s business model envisages activities along the VRFB value chain and will include an electrolyte capacity in South Africa, a VRFB assembly and manufacturing as well as an energy storage project development.”
The best performing commodity Without a doubt, vanadium has been the front runner of the commodity price market in recent years, surging by more than 365% in the last three years from US$18.6 per kg of vanadium to US$81.2 per kg in 2018. Mojapelo explains that this astronomical price increase in vanadium has been driven by a fundamental supply deficit in the vanadium market, arising from growing demand underwritten from the steel sector, which accounts for around 90% of vanadium consumption. “The steel market is set to continue supporting robust vanadium demand,
Fortune Mojapelo, Bushveld Minerals CEO
which is expected to grow at a CAGR of approximately 2% over the next 10 years,
MINING | Bushveld Minerals
supported by the increased intensity in use
“The market share of VRFBs compared
of steel in emerging markets, particularly
to other energy storage technologies is a
in China, underpinned by the improved
key assumption,” states Mojapelo. “Recent
enforcement of regulations.”
trends to revise energy storage forecasts upward imply that vanadium demand from
Therefore, Bushveld believes that the current
VRFBs may be greater than expected, even
vanadium price and supply/demand gap
under ‘aggressive forecasts’. Within 10 years,
suggests that there is sufficient incentive
demand for vanadium by energy storage
to stimulate new production from existing
could equate to 50-100% of today’s global
primary producers, which is exactly what the
market.
company plans to do in the near term. “The current market dynamics point to a Bushveld’s unique position as one of three
positive price outlook, underpinned by a
operational primary vanadium producers,
growing deficit which we believe can only be
and one of only two vanadium-focused pure
closed by existing quality primary vanadium
play companies, will also allow the company
producers like Bushveld Minerals, who are in
to leverage its large low cost production base
a position to scale up production.”
and be a catalyst in the emerging energy storage industry.
Resource Global Network
The resource base
adjacent to Vametco. “The mineralisation
The Vametco Mine in Brits, North West
is outcropping and a continuation of the
Province is a low cost vanadium mine with
Vametco deposit strike with similar or higher
a 142.4 Mt resource that also produces a
vanadium grades,” Mojapelo reports.
trademark vanadium product, Nitrovan® as well as modified vanadium oxide (MVO).
Recent drilling results have indicated vanadium grades in magnetite of 1.54 - 2.09%
Bushveld increased its controlling interest
vanadium pentoxide, again similar to the
in Vametco to 74% in September 2018
mineralisation seen at the Vametco Mine.
through a series of transactions, having first
Therefore, Bushveld expects Brits to support
invested in the operation in April 2017. The
Vametco or other brownfield facilities when
firm recently commenced an operational
it comes online, but first the company must
transformation programme to enhance
complete a mineral resource estimate that is
Vametco’s production efficiency.
scheduled for Q1 2019.
Another key part of this ambitious medium-
The Mokopane Vanadium Project is the
term production target is the development of
final component of Bushveld’s vanadium
the Brits Vanadium Project, which comprises
triumvirate and happens to be one of the
prospecting rights on several farms
world’s largest primary vanadium resources,
MINING | Bushveld Minerals
Resource Global Network
“The current market dynamics point to a positive price outlook, underpinned by a growing deficit which we believe can only be closed by existing quality primary vanadium producers like Bushveld Minerals, who are in a position to scale up production.” Fortune Mojapelo, CEO Bushveld Minerals Mt reserves and high in-situ (1.4%) and in-
The next generation of energy storage
concentrate (1.75%) vanadium pentoxide
The formation of Bushveld Energy and
grades.
Bushveld’s subsequent entry into the VRFB
with a 298 Mt JORC resource including 28.5
sector was intended to position the company A positive pre-feasibility study was completed
at the vanguard of the next generation of
back in January 2016 which indicated a
energy storage technology.
25% IRR, $300 million capex and a 5,500 Mt per annum production rate. The intention
“The company believes that VRFBs are well
remains to secure a new order mining
positioned to take a significant share of the
right and either develop Mokopane into
global utility-scale energy storage market,
a vanadium mine and processing plant or
where their distinctive features, including
supply ore from the project to plants in China
low life-of-battery costs, 20-year life without
and/or elsewhere in the world.
performance degradation, flexible scalability, long duration energy storage capacity and
Bushveld’s target is to grow its production
inherent safety give them a significant
platform from the current levels of
advantage over other technologies.”
approximately 3,000 Mt of vanadium to 10,000 in the medium term. The company’s
VRFB technology combines the performance
assets are positioned in first to second
advantages of flow batteries with the
quartile cost curve position. Bushveld aims to
simplicity of using just one natural element
keep reducing costs and be cash generative
– vanadium. Flow batteries use a liquid
throughout the cycle.
electrolyte to store energy, this allows for near unlimited recharging (or cycling), easy scaling by just adding more electrolyte and negligible performance deterioration over long periods of time.
MINING | Bushveld Minerals
Resource Global Network As a result, for daily energy storage of a few hours or more, flow batteries provide the most cost-effective means to store energy. The advantage of vanadium, lies in its ability to exist in four different oxidation states and its water-solubility, allowing for a simpler battery with fewer inputs and no flammable elements. Having said that, Mojapelo points out that the most common question about VRFBs is how they compare to lithium-ion battery technology. “There is no clear superiority, with use cases and site requirements often determining the optimal solution. VRFBs and Lithium-ion are non-competing technologies,” he says. “Nonetheless, Bushveld has seen the global deployment of VRFBs increase year-on-year and has made significant progress defining the energy storage market opportunity, building industry awareness for VRFB and developing a business model for Bushveld Energy. “The business model is anchored in Bushveld Minerals’ low-cost production platform and smart partnerships along the VRFB value chain.” One such relationship is with UniEnergy Technologies (UET), a US-based manufacturer of turn-key, large and mediumscale energy storage systems for utility, micro-grid, commercial, industrial and other applications.
MINING | Bushveld Minerals
The future of Bushveld Minerals Taking into consideration the sky-high
electrolyte. The electrolyte is sold to VRFB companies or direct users/buyers of VRFB systems.”
potential of the VRFB technology industry, Bushveld Energy is set to take up a larger
Mojapelo also highlights Bushveld Energy’s
role in the wider Bushveld story, as vertical
role in developing the energy storage value
growth opportunities multiply across the
chain in South Africa through the application
Bushveld Energy division.
of South Africa-mined and beneficiated vanadium in VRFBs.
“A key part of Bushveld Energy’s strategy is the creation of an electrolyte production
“As a leading primary vanadium producer
facility which Bushveld Energy is establishing
and exporter, South Africa serves as the
with the IDC. The electrolyte manufacturing
logical base for VRFB manufacturing.
will include building and operating a
This includes multiple steps of mineral
chemicals plant that purifies vanadium
beneficiation, including converting vanadium
feedstock and converts it into a liquid
into electrolyte and assembling VRFBs locally.
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“We are convinced that significant demand
acquisition opportunities to build a 10,000
will come from Africa and for similar logic to
Mt production platform in the Bushveld
locating electrolyte production here in South
Complex, along with exciting opportunities in
Africa. Especially in the South African market,
the lively VRFB technology sector.
local content plays a key determining factor and we believe that no battery technology
This growth plan provides a sound basis
can come close to competing with VRFBs on
for the company to develop into one of the
this criterion in South Africa.�
largest, lowest cost, vertically integrated primary vanadium producing companies and
Overall, Bushveld Minerals is advancing a
one of the most influential organs of South
significant horizontal and vertical growth
Africa’s emerging energy storage industry.
plan, incorporating brownfield expansion and
AIM:BMN
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Published by Anderson Murray Media Ltd
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