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TMT has eyes on the prize

an Prentice’s vision for vanadium hopeful lion ($454 million) is estimated to be paid
ITechnology Metals Australia Ltd (TMT) is back within 3.2 years of first production at
as straightforward as they come. Gabanintha, which will suddenly become
“Given there’s not many other primary the world’s largest primary vanadium pro-
producers in the vanadium space, we need ducer if the forecast annual output 27.9
to be the next primary producer that gets mlb is achieved.
financed and builds a project,” he said. Gabanintha is also expected to be one
“We don’t necessarily see ourselves as of the world’s highest grade vanadium
competing with the incumbent producers, producers with an average feed grade of
but we do see ourselves as capable of plus-1% V2O5 anticipated over the first 12
being the next producer, that’s how we’re years of operations.
looking at it. “It’s really important as a new entrant
“From our perspective, a peer analysis into the market to make sure you’re com-
is more about looking at other companies petitive on that operating cost parameter Gabanintha is set to produce a high purity
that also have projects prospective for de- and that really comes back to the quality of V2O5 product grading at least 99%
velopment. No one else is as far advanced our resource,” Prentice said. “In a gold project you can hedge your
from a study point of view and so that’s “Grade obviously is really important, forward production and everyone knows
why we’re saying we need to be the next but so is your metallurgy. The magnetic you’re guaranteed whatever price, we
producer on that list.” concentrate we produce is very clean; it don’t have that. So, offtakes are our mech-
Prentice – TMT’s managing director – doesn’t have a lot of deleterious elements anism to enable the financiers to have
spoke to Paydirt in light of the company which are reagent-robbing in the roasting comfort around both the volume of product
unveiling a robust DFS which forecast section of your plant. we can sell, but also the pricing structures
lowest quartile cash costs for production “Efficiency through the roasting section around that.”
of vanadium pentoxide (V2O5) from its of the plant is really, really key to delivering TMT will look to progress offtake and
Gabanintha project in Western Australia’s a really high purity final product, and again finance discussions for the rest of the
Murchison region. that goes all the way back to having a re- year and into 2020 with a final investment
Life-of-mine cash costs of $US4.04/lb ally clean ore to start with.” decision targeted for April. In the mean-
headlined a strong set of project econom- Extensive test work has indicated Gab- time, the company will look to finalise its
ics which also included EBITDA of $4.1 bil- anintha will produce a high purity V2O5 environmental approvals and mining lease
lion over the initial 16 years of operations, product grading at least 99% – industry grant, as well as kick off detailed engineer-
pre-tax NPV of $US924 million and IRR benchmark pricing is for 98% – which is ing studies.
of 34%, assuming an average life-of-mine set to attract a handy sales premium. Prentice is confident his company’s
V2O5 pricing of $US10.88/lb. TMT signed a non-binding MoU with cost estimates will closely mirror actual
Pre-production capital of $US318 mil- CNMC Ningxia Orient Group Company numbers because of its collaboration with
Ltd, a subsidiary of China Nonfer- FLSmidth Inc, which built and now main-
rous Metal Mining (Group) Co Ltd, tains many of the kilns used in some of
earlier this year with a view towards the world’s most notable vanadium opera-
establishing a more formal V2O5 tions, including TSX-listed Largo Resourc-
offtake agreement. Prentice said he es Inc in Brazil.
expected interest in his company’s “If your kiln doesn’t work then your whole
product would start to accelerate project economics go out the window,” he
now the DFS findings were public. said.
“For a lot of the parties we’ve en- “We knew we had to deal with a group
gaged with, the last piece for them that has got current hands-on experience
was getting hold of the DFS and in running this part of the circuit, but what
making sure it confirms all the detail that’s meant is we have had a little bit
that we’ve been working on and de- more capital. But, from our point of view,
livering,” Prentice said. we were very comfortable spending a bit
“I think from a project point of more on that because that’s where the real
view, and also from an equity mar- key risk is.”
ket point of view, it’s really about While the Gabanintha orebody hosts
understanding that we do have the some potential base metal credits, TMT
support of the customers and of has not yet determined if their extraction
the offtakers, both on product con- will prove economic. Prentice said it was
sumption but also on supporting something the company may look to build
the financing. Now, whether or not into the circuit once the vanadium opera-
those groups assist with the financ- tion was up and running.
ing or are just key in having them on – Michael Washbourne
board, it means that the financiers
TMT’s Gabanintha project hosts a proven and are a lot more comfortable.
probable reserve of 29.6mt @ 0.88% V2O5

aUSTRaLIa’S PaYDIRT OCTOBeR 2019 Page 7