In October 2022, the Company released a Definitive Feasibility Study (DFS) confirming the Steelpoortdrift (SPD) Vanadium Project’s potential to be a world-class, large scale and low-cost vanadium producer with competitive Opex and Capex metrics (refer ASX announcement 4^th October 2022). The 25-year project comprises the open pit mining of titaniferous vanadium ore, primary treatment of the ore through an onsite concentrator (using magnetic separation), and secondary treatment of concentrate through a Salt Roast Leach (SRL) plant to produce a >98% V₂O₅ flake.

The DFS demonstrated a two-phase operation which will produce a total of 484,000t of V₂O₅ flake over a 25-year period, providing a post-tax NPV_7.5% of US$1.21bn (attributable share of US$0.9bn) with an IRR of 42%. The Project will generate annual free cashflows of US$152m with a short payback period of less than 2 years due to the high-grade nature of the mineralisation and the low Capex requirement of US$211m.

Table 1 below presents an outline of the key metrics for the life of mine.

Table 1 DFS Key Metrics and Financial Results (LOM)

Phase 1 Project: The project will be bult in two phases with the initial pre-production capex of US$211m providing the infrastructure for Phase 1 which will operate for the first four years (Year 1-4) and involves the mining of 1.6Mt of vanadium ore per year at an average in situ grade of 0.83% V₂O₅, which will be processed through the concentrator and SRL plant to produce ∼12ktpa of V₂O₅ flake.

Phase 2 Project: An additional US$188m will then be taken from the free cashflows to expand the plant and allow, from Year 5 onwards, the mining rate to increase to 3.5Mtpa of ore at an average grade of 0.71% V2O5 with production almost doubling to ∼21ktpa of flake.

Further details on the annual average metrics of each phase are presented in Table 2 below.

Table 2 Annual Average Metrics for Phase 1 & Phase 2 of Production

Details of the Mineral Resource, Ore Reserves, mine design and schedules, processing methods and infrastructure can be found in the adjacent tabs or in the DFS itself (downloadable below).

The DFS identified a number of significant opportunities that would reduce costs and increase the potential Mineral Resources, Ore Reserves and the associated life of mine (LOM) plan to more than 180yrs, decrease environmental impacts and increase earnings potential. These opportunities were investigated to a level less than that required for inclusion into the DFS. The following opportunities may be considered by investors but will require additional, more detailed value engineering studies going forward:

• ropeway conveyor system to transport concentrate from mine site to SRL plant;
• removal of community and water course constraints on Mineral Resource estimation and associated LOM;
• residual vanadium recovery plant; and
• titanium in SRL tailings.

Having completed the DFS, the Company is working towards Final Investment Decision (Q4 CY2023 target) with a focus on building the project development and execution team, commencing the FEED studies, securing debt financing and partnering with strategic groups to ensure the maximum value of the project is unlocked.