Name of the Project
Vametco and Vanchem operations expansion.
Location
South Africa.
Project Owner/s
Bushveld Minerals.
Project Description
Bushveld’s Vametch and Vanchem operations are on track to achieve sustainable production of between 5 000 t/y and 5 400 t/y by the end of 2022.
Studies have been conducted to determine the optimal path to increase production at the operations to 8 000 t/y.
In Stage 1, it is proposed that a semiautogenous grinding (SAG) mill be installed at Vametco to establish a permanent and reliable supply of feedstock for both operations in anticipation of further capacity expansion.
Stage 2 will result in the refurbishment of Kiln 2 at the Vanchem plant to increase production from 2 600 t/y to between 3 600 t/y and 3 700 t/y.
Stage 3 will entail the refurbishment of Kiln 1 to increase production from between 3 600 t/y and 3 700 t/y to between 4 600 t/y and 4 800 t/y.
In Stage 4, single kiln capacity at Vametco will be increased from 2 800 t/y to 3 400 t/y; this will result in an overall increase in group production of about 7 600 t/y to 8 000 t/y.
Potential Job Creation
Not stated.
Net Present Value/Internal Rate of Return
Not stated.
Capital Expenditure
The expansion will require capital expenditure of about $151-million.
Installation of the SAG mill will cost about $32.9-million. The refurbishment of Kiln 1 and Kiln 2 will cost $53-million and $37-million respectively.
The increase in single-kiln capacity will cost about $28.2-million.
Planned Start/End Date
The installation of the SAG mill is expected to take 24 months, the refurbishment of Vanchem’s Kiln 1 and 2 from 18 to 24 months, and the increase in single-kiln capacity 12 to 18 months.
Latest Developments
Bushveld Minerals has received $8.1-million in interim working capital from investment fund Southern Point Resources (SPR).
The interim facility will provide the group with additional working capital to fund the ongoing expansion of production at the Vanchem vanadium plant, while the completion of the SPR transactions are under way.
Earlier this month, Bushveld announced a binding termsheet agreement with SPR for a cumulative proposed investment of between $69.5-million and $77.5-million.
In terms of the agreement, SPR proposes to acquire 50% of the shares in Bushveld’s subsidiary that owns the Vanchem plant and its 64% equity interest in its subsidiary that owns the Mokopane project, for about $25-million; provide an equity investment of $12.5-million; medium-term trade finance of between $25-million and $30-million in terms of a new marketing and sales arrangement; and a potential future commitment by SPR of $7-million to $10-million in Vanchem for the recommissioning of Kiln 1.
The completion of the transactions with SPR, as well as the refinancing of Orion Mine Finance’s convertible loan note, are key to Bushveld’s ability to continue as a going concern.
“We continue to make progress in respect of the refinancing of the Orion convertible loan note and we are confident that this will be completed before the December 2023 due date,” Bushveld CEO Craig Coltman has said.
In its six-month results announcement for the period ended June 30, 2023, the company reports that it remains on track to meet the revised 2023 production guidance of between 3 700 t of vanadium and 3 900 t of vanadium , as well as weighted average production cash cost (C1) guidance of between $26.6/kg of vanadium and $26.9/kg of vanadium (R481/kg of vanadium and R487/kg of vanadium ).
Bushveld’s Vanchem processing facility produced 160 t of vanadium in July and 175 t of vanadium in August this year, 63% higher than the average monthly production of 103 t of vanadium achieved in the first half of 2023.
Bushveld’s Vametco mine and processing facility also produced 132 t of vanadium in July, and 215 t of vanadium in August.
The improved production at Vanchem has shown that Bushveld has a plant that can reach its full potential.
The company has said that it must now consolidate the improved efficiencies and achieve sustained target growth of 180 t of vanadium a month for Vanchem by the end of 2023.
Key Contracts, Suppliers and Consultants
METC South Africa and MSA Group (feasibility and prefeasibility studies).
Contact Details for Project Information
Bushveld Minerals, tel +27 11 268 6555 or email info@bushveldminerals.com