Date: Nov 1, 2018
As the world transitions into cleaner sources of energy and rechargeable batteries, new age metals have become a sought after corner of the market.
Vanadium has been the standout energy metal of 2018, its price rising in excess of 450% since this time last year.
Principally used in steel making to add strength via various alloys, vanadium is the most common additive in high strength rebar, offering an exceptional blend of strength, weldability and flexibility.
It also has specialty applications, including in vanadium redox flow batteries (VRFB), which can store large amounts of energy almost indefinitely. In fact, this previously unheralded metal could become a vital part of the renewables revolution.
There’s the huge potential from growth in vanadium redox flow batteries (VFRB), which many believe could be a superior way of storing grid energy generated by renewable energy sources, such as solar or wind generated energy, than traditional or lithium-ion batteries. The features of VRFBs make them attractive for household or small town sized energy storage requirements.
While the vanadium price has already run hard over the past year, the good news for investors who haven’t yet recognised its potential is that global supply will be limited in coming years, while demand is being driven to new highs.
Given that current vanadium supply is largely Chinese, the country’s ability to supply the market is expected to be hampered due to new environmental restrictions. However, China will also be behind much of the increase in demand.
Demand from Chinese steel makers is forecast to rise after a recent mandate to construction companies to use higher tensile strength steel rebar, which is created using vanadium, in construction will directly carry over to increased demand.
The new legislation, which will take effect on November 1, will enforce the adoption of new steel rebar standards, prohibiting the use of substandard steel rods and modernising the country’s future infrastructure projects.
As a result, vanadium prices are skyrocketing.
Source: vanadiumprice.com
Source: vanadiumprice.com
This tightness has driven prices to more than US$33/lb, up from around US$6/lb just 12 months ago.
Vanadium explorers on the ASX
With both tangible short and long term demands at play, vanadium presents some intriguing investment opportunities. There are now around 40 ASX listed stocks that offer exposure to this emerging metal:
Audalia Resources (ASX:ACP)
Aura Energy (ASX:AEE)
Arafura Resources (ASX:ARU)
Australian Vanadium Limited (ASX:AVL)
Battery Minerals (ASX:BAT)
Chalice Gold Mines (ASX:CHN)
Energy Metals (ASX:EME)
Golden Deeps (ASX:GED)
Hardey Resources (ASX:HDY)
Intermin Resources (ASX:IRC)
Korab Resources (ASX:KOR)
King River Copper (ASX:KRC)
Lithium Australia (ASX:LIT)
Lincoln Minerals (ASX:LML)
Liontown Resources (ASX:LTR)
Mayur Resources (ASX:MRL)
Mount Burgess Mining (ASX:MTB)
Marindi Metals Limited (ASX:MZN)
Neometals (ASX:NMT)
New Energy Minerals (ASX:NXE)
Pepinnini Lithium (ASX:PNN)
Protean Energy (ASX:POW)
Pursuit Minerals (ASX:PUR)
QEM Ltd (ASX:QEM)
Redstone Resources (ASX:RDS)
Rumble Resources (ASX:RTR)
Sabre Resources (ASX:SBR)
Six Sigma Metals (ASX:SI6)
Surefire Resources (ASX:SRN)
Southern Cross Exploration (ASX:SXX)
Syrah Resources (ASX:SYR)
Technology Metals Australia (ASX:TMT)
TNG (ASX:TNG)
Tando Resources (ASX:TNO)
Triton Minerals (ASX:TON)
Venus Metals Corporation (ASX:VMC)
Vital Metals (ASX:VML)
Walkabout Resources (ASX:WKT)
In part 1 of this two part guide, Finfeed has selected seven vanadium stocks that warrant a closer look.
Tando Resources (ASX:TNO)
Market cap: $21.29m
Current share price: $0.105
Tando Resources (ASX:TNO) has recently revealed a string of high-quality assay results from its SPD Vanadium Project in South Africa. The project is located in a known vanadium producing region with Direct Shipping Ore (DSO) potential. The grade profile is one of the highest of all ASX listed vanadium projects.
Tando has completed its Phase 1 drilling program targeted at the established SPD deposit, which currently hosts a Resource of 513mt at 0.78% vanadium.
The company is now testing the surrounding regions for the potential of high-grade vanadium pipes, which could complement a low-cost DSO operation on site.
Whilst it is concentrating much of its efforts on its vanadium project, Tando has three further projects all in Australia. The Quartz Bore Project is a high grade zinc project located in the Pilbara region of Western Australia. The Mt Sydney Project, also in WA, comprises a single exploration licence application in an area prospective for copper, zinc and lead mineralisation. High priority targets have been identified neighbouring Rumble Resources project where there is the potential for a volcanogenic massive sulphide system. The last project in the Pilbara region is Mt Vernon, which also comprises a single exploration licence for the exploration of stratabound zinc-lead-silver and structurally controlled copper-gold mineralisation targets.
