Mustang Resources has completed its maiden JORC mineral resource estimate for the Caula vanadium-graphite project in Mozambique, amounting to 22 million tonnes (Mt) at 0.37 per cent vanadium pentoxide (V2O5).
The news came days after Mustang announced the merging of its ruby interests with Toronto- and Dubai-based Fura Gems as part on attempt to dedicate its focus solely on the Caula project.
Mustang managing director Bernard Olivier said, “This is an exceptional result, with over 81,000 tonnes contained V2O5, particularly given that the entire JORC resource is in the measured category.
“With vanadium pentoxide prices running at more than $US40,000 ($54,000) per tonne (98 per cent V2O5), the Caula resource translates to a highly valuable resource.”
Chinese vanadium demand has experienced a 15 per cent jump in one month from April to May 2018. Minimum specifications for building constructions in China have become more stringent in recent years, causing steel mills to make a switch to higher-strength steel.
Meanwhile, the production of batteries consumed 3000 tonnes of vanadium last year, which was twice as much the figure reported in 2016. This is due to the expanding markets for graphite and lithium battery for electric vehicles.
Olivier also pointed to the relative ease in extracting Caula’s vanadium, saying, “The potential of the project is even greater as our vanadium is mica-hosted and associated with the graphite mineralisation.
“[It is] potentially far cheaper to extract and recover through two simple processing steps compared with most vanadium projects, where the vanadium is located in a complex titaniferous magnetite ore body.”
Mustang revealed an existing graphite resource at Caula of 5Mt at 13 per cent total graphitic carbon (TGC). The project’s first graphite output is scheduled to take place in mid-2019.
Mustang said that its vanadium will be extracted to a concentrate, which will either be sold to vanadium producers or stockpiled for future production of refined V2O5 chemicals.