The deal provides a development catalyst for the Coates project which is a secondary asset for AVL.
Australian Vanadium Ltd (ASX:AVL) has signed a joint venture agreement with a private company to advance the Coates Vanadium Project near Perth in Western Australia.
The agreement is with Ultra Power Systems Limited (UPS), a vertically integrated electrochemical processing and energy storage company.
UPS aims to produce vanadium electrolyte and will test material from the Coates as feed material.
UPS holds very rare production licence
UPS has secured a licence to Pacific Northwest National Laboratory’s (PNNL) generation 3 vanadium electrolyte production.
The licence is one of three globally.
UPS also holds the exclusive Australian option to license a processing technology VEPT, which ebales the recovery of valuable by-products during the vanadium processing route with minimal carbon production and minimal waste.
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AVL’s managing director Vincent Algar said: “Having a deposit so close to Perth will enable the testing of both the VEPT process and production of generation 3 electrolyte at a relatively low cost.
“AVL looks forward to developing the relationship with UPS further as we advance the vanadium industry in Western Australia.”
Mutually beneficial deal
UPS managing director Brad Appleyard added: “We are excited to commercialise VEPT exclusively in the mining friendly and vanadium-rich jurisdiction of Australia.
“With strong channel partners, investors and government support we intend to establish the leading integrated solution for vanadium batteries worldwide.
“Stationary battery storage is the key to a successful transformation of the energy industry into one based on renewable energy.
“Vanadium Redox Flow Batteries are the cleanest and most effective such technology available today.
“The central role played by the electrolyte in these batteries provides UPS with an opportunity to play a key role in the power industry well into the future.”
AVL stands to gain $0.5 million or shares in UPS
The agreement allows UPS the exclusive right to earn a 49% legal and beneficial interest in the tenement on a $5,000 signing fee, followed by $50,000 being spent on exploration within 12 months and $150,000 within 24 months.
Following this, UPS will be able to acquire AVL’s joint venture interest for $0.5 million or shares in UPS, at the election of AVL.
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