ASX-listed junior Australian Vanadium has signed a second memorandum of understanding (MoU) with specialty chemical producer US Vanadium for the supply of high purity vanadium oxides and a licence for vanadium electrolyte production.
This agreement will allow Australian Vanadium to start local vanadium electrolyte production to support growing interest in the emerging Australian vanadium redox flow batteries (VRFB) market.
The MoU complements the MoU already signed with US Vanadium regarding future offtake of vanadium from the Australian Vanadium project, for use in the US critical metals market.
Both MoUs will lead to a binding mutual vanadium supply and technology licence agreement between the two companies.
“Having a strong relationship with a company of US Vanadium’s calibre in the vanadium market enables Australian Vanadium to secure a supply of the highest quality vanadium oxides, prior to bringing the Australian Vanadium project into production,” said MD Vincent Algar.
“This will allow us to move quickly to build a vanadium electrolyte plant here in Australia to supply the growing VRFB market. The plant will be partially funded by the recently announced award of the Modern Manufacturing Initiative (MMI) grant by the federal government.
“Our vanadium electrolyte plant will be capable of producing up to 33 MWh of capacity each year and will enable Australian Vanadium to secure supply deals for Australian VRFB implementations. Our 100% owned subsidiary VSUN Energy has already identified multiple projects suitable for locally produced vanadium electrolyte. This vertical integration strategy puts Australian Vanadium in a strong position to secure financing for the project and provides Australian employment opportunities in the downstream battery supply chain.”
The company was awarded a A$3.69-million grant through the MMI to develop a high purity vanadium production circuit, build and operate a 33-MWh capacity vanadium electrolyte plant, and produce locally assembled prototype VRFB systems for domestic and standalone remote power systems.
Vanadium electrolyte, manufactured from very high-purity vanadium oxides, is the key component in all VRFBs, which are the subject of growing attention for renewable energy storage.
US Vanadium will grant Australian Vanadium the exclusive use of its vanadium electrolyte technology in Australia and New Zealand, which will allow Australian Vanadium to use either US Vanadium or its own vanadium products when available.
The US Vanadium technology and expertise has a track record for being a low-cost method of production of balanced electrolyte, suitable for a wide range of VRFB manufacturers’ specifications.
US Vanadium will provide technical support for the first two years at no cost to AVL, followed by technical support being available from US Vanadium at cost.
The agreement terminates if Australian Vanadium has not built a vanadium electrolyte plant within 24 months. The licence will continue for a period of five years.
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