Neometals Seals Deal with Glencore for Guaranteed Offtake of Vanadium Products

  • Wednesday, July 12, 2023

  • Keywords:Ferroalloy, Vanadium, Molybdenum, Tungsten, Manganese Ore, Chrome Ore,Iron Ore
[Fellow]Neometals Seals Deal with Glencore for Guaranteed Offtake of Vanadium Products

[] In a significant move, sustainable battery materials producer, Neometals Ltd , has confirmed the execution of a binding offtake agreement with commodities giant Glencore International AG for its Vanadium Recovery Project (VRP1). The deal underscores the rising market demand for high-purity, carbon-neutral vanadium pentoxide (V2O5), produced from European Union (EU) raw materials.

Under the agreement, Neometals’ wholly-owned subsidiary, Novana Oy, will sell and deliver all vanadium products produced by VRP1 to Glencore. This arrangement will hold for an initial period of five years from the commencement date and extend in two-year increments, given neither party elects not to renew the agreement.

This alliance is of strategic significance for Neometals, given Glencore’s vast experience in vanadium operations at the Rhovan Mine in South Africa. The commodities heavyweight will lend its technical expertise to VRP1’s development through a joint steering committee, advising and offering insights.

The delivery period is slated to commence on January 1, 2026, or an earlier date decided by Novana with a year’s notice. The price payable for the vanadium bearing products is tied to prevailing market-publication rates.

“Securing take or pay offtake for 100% of VRP1 vanadium products is a significant milestone as we progress towards a FID this quarter,” said Chris Reed, Neometals’ Managing Director. He emphasized the “anticipated future need for high purity material in the market,” driven by increasing demand from the vanadium redox flow battery sector and other high purity applications.

Neometals, with a 72.5% stake in Recycling Industries Scandinavia AB (RISAB), the JV company owning Novana, stands to make substantial gains from this agreement. Critical Metals Ltd holds the remaining 27.5% interest in RISAB.

This alliance reinforces Neometals’ vision to become an emerging, sustainable battery materials producer. The company has been championing environmentally-friendly processing technologies, aiming to produce lithium, nickel, cobalt, and vanadium at minimal carbon footprints and lower costs. The VRP1-Glencore deal offers a compelling validation of this strategic vision.

  • [Editor:tianyawei]

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