Technology Metals Australia has executed a non-binding memorandum of understanding (MoU) with Shaanxi Fengyuan Vanadium Technology Development to establish an offtake agreement for vanadium production.
The vanadium will be sourced from the Gabanintha vanadium project in Western Australia.
Fengyuan is a high-tech vanadium–nitrogen alloy producer with capacity to produce 10,000 tonnes per annum (Tpa) of vanadium, requiring approximately 14,300 Tpa of vanadium pentoxide (V2O5) feedstock.
Both parties have mutually agreed to extend a previous MOU until November 30 2019.
Technology Metals managing director Ian Prentice said the two offtake MOU’s account for over 5000 Tpa of the proposed 12,800 Tpa production.
“Discussions with prospective development partners are progressing extremely well following the delivery of the very high-quality definitive feasibility study…combined with the very high purity of the V2O5 product,” Prentice said.
Fengyuan will purchase an initial minimum annual quantity of V2O5 of 3000 Tpa, along with purchasing available product up to 3000 Tpa, during the ramp-up and commissioning phase of the project.
Pricing will be based on market prices with a minimum term of five years and an option to renew for an additional five years.
Fengyuan is ranked amongst the top three vanadium producers in China, producing 5000 tonnes of vanadium in 2018, consuming approximately 7200 tonnes of V2O5.