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Largo eyes 25% Maracás Menchen capacity increase, plant improvements

16th April 2018

By: Henry Lazenby

Creamer Media Deputy Editor: North America

     

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VANCOUVER (miningweekly.com) – Vanadium producer Largo Resources is looking to increase the production capacity at its flagship Maracás Menchen mine, in Brazil’s Bahia state, by 25% from the current 800 t/m to 1 000 t/m, it said in a statement on Monday.

These improvements translate to 200 t of additional vanadium pentoxide (V2O5) being produced from June 2019 onwards.

The improved operation will cost about $15.5-million, with construction slated to start in June.

Largo added that production capacity can also be enhanced by operational improvements at the kiln refractory, which will allow management to lift the plant capacity by a further 100 t/m to 1 100 t/m of V2O5, and the company is studying its viability.

“The relatively low expected capital expenditure for this expansion project when compared to the anticipated significant increase in capacity made approving this expansion an easy decision for the company. The new expansion plan for the Maracás Menchen mine paves the way for a new chapter of growth for Largo and culminates in additional and significant free cash generation for the company, assuming current V2O5 prices,” president and CEO Mark Smith stated.

Largo's vanadium flake, high-purity vanadium flake and high-purity vanadium powder have been qualified, or are being qualified, by every major end-user of the metal in high-purity applications, further underscoring the quality of the Maracás Menchen asset.

Largo has been enjoying strong growth in V2O5 pricing in recent quarters, with the price currently trading in a range of $15/lb to $16/lb – nearly double Largo’s average realised price of the fourth quarter of 2017.

Edited by Creamer Media Reporter

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