Name of the Project
Steelpoortdrift vanadium project.

Location
The Steelpoortdrift titaniferous magnetite deposit is located in the prolific Bushveld Geological Complex, in South Africa.

Project Owner/s
Vanadium Resources (VR8).

Project Description
A scoping study has confirmed the competitive capital and operating costs for Steelpoortdrift, which compare favourably with other global vanadium projects.

The study is based on the latest mineral resource estimate for the project reported in April 2020, which is estimated at 662-million tonnes at an in situ grade of 0.77% vanadium pentoxide (defined above an in situ grade of 0.45% vanadium pentoxide). This includes 188-million tonnes at an in situ grade of 1.23% vanadium pentoxide (defined above an in situ resource grade of 1% vanadium pentoxide).

The study proposes the development of a 1.6-million-tonne-a-year standalone mining, beneficiation and processing operation to produce between 8 500 t/y and 9 400 t/y of high-purity vanadium flake.

The project has a life-of-mine (LoM) of 30 years, although the financial study was completed on an initial 25-year operation.

The project aims to produce 48.5-million tonnes over the LoM.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at an 8% discount rate, of between $359-million and $401-million, and an internal rate of return of 28.8% to 30.7%, with a payback of two to three years.

Capital Expenditure
Preproduction capital is estimated at between $161.6-million and $187.9-million.

Planned Start/End Date
Once funding is secured, construction of the processing plant will take about 24 months from breaking ground until commissioning. The beneficiation plant will be operational after 9 to 12 months, with mining to start during this time to ensure an adequate stockpile for commissioning and initial production of the salt-roasting plant.

Latest Developments
Based on its current market capitalisation, VR8 does not currently have the financial capacity to (internally) fund 100% of the construction of the Steelpoortdrift project.

External funding in the form of combined debt, offtake funding, joint venture interest, direct project investment and/or equity will be required.

The company recently announced the engagement of Pelagic Resources Group (Pelagic) under a mandate to assist VR8 to source a strategic investment in the company. Such an investment would then result in Pelagic’s being granted marketing rights over products from the project, and additional marketing or offtake agreements could further support the development of the project. VR8 is advancing rapidly to complete a pre­feasibility study (PFS) by the first quarter of 2021 to improve the level of accuracy in the capital expenditure (capex) and operating expen­diture (OPEX) estimates, at about A$300 000.

VR8 believes that the compelling results of the scoping study and a completion of the PFS will continue to support the sourcing of funding required to develop and construct the Steelpoortdrift vanadium project.

Long-lead items are likely to be the milling circuit for the beneficiation plant and the kiln for the salt roasting plant.

Key Contracts, Suppliers and Consultants
Contributors to the scoping study include: Les Ford (study manager); GEMECS (geology, drilling and sampling); Mining Plus (mineral resources, including the mineral resources within the production target and optimisation and mining studies); Sound Mining (mining and operating expenditure – or OPEX – studies); ENC Minerals (process testwork, capital expenditure – capex – and OPEX studies); Mintek (process testwork); METS South Africa (concentrator, capex and opex); Red Kite Consulting (environmental studies); Noboprox (community and social studies); James Wilson (financial modelling); and Rock wealth Discovery (scoping study review).

Contact Details for Project Information
Vanadium Resources, tel +61 8 9420 9300 or email contact@VR8.global.