Surefire Resources secures vanadium processing deal with Kingdom of Saudi Arabia

Perth-based junior Surefire Resources (ASX: SRN) has secured an agreement with Saudi Arabia’s Ministry of Investment for processing opportunities of high-grade ore from its wholly-owned Victory Bore vanadium and high purity alumina (HPA) project in Western Australia.

A memorandum of understanding signed between the two parties provides Surefire with a clear pathway for maximising value from the project.

It follows a development proposal put forward by the company for a mining and beneficiation operation at Victory Bore and the transport of high-grade vanadium-bearing magnetite concentrate to Geraldton Port for shipping to Port Damam in Saudi Arabia.

Downstream processing of the concentrate would take place at nearby industrial sectors to produce high-value end products of vanadium pentoxide, vanadium electrolyte and ferro-vanadium plus by-products of pig-iron, ferro-titanium and potentially HPA.

Terms of the deal

Under the terms of the deal, the Ministry of Investment will provide assistance for the import and processing of Surefire’s mineral concentrates from Victory Bore.

It will help the company identify suitable process plant locations in Saudi Arabia, introduce potential partners and secure binding agreements for project funding and development.

Surefire will introduce its preferred engineering partners to design and construct the facilities and will also consider the establishment of a HPA production plant in the region.

Agreement benefits

Surefire managing director Paul Burton said the processing of Victory Bore concentrate and other vanadium-bearing feedstock in Saudi Arabia would create investment, processing capability, employment and the production of high-value commodities.

“This is a very significant milestone and achievement for our company and provides a clear development pathway for Victory Bore as we progress the project’s pre-feasibility study,” he said.

“Saudi Arabia is a rapidly-developing region with demand and incentives for critical mineral resources [and] we look forward to working closely with the Ministry of Investment to achieve our mutually-beneficial development plans.”

Low power and fuel cost

As one of the world’s fastest growing countries, Saudi Arabia is a low power and fuel cost jurisdiction with a significant steel sector requiring vanadium products not generated domestically, such as vanadium electrolyte (for vanadium redox batteries).

Its manufacturing sector records an average 7.5% growth per annum thanks to a large market, developed research and development facilities, government support, modern infrastructure and business-friendly regulations.

Saudi Arabia is embarking on the most ambitious infrastructure reform in its history, with mega and giga infrastructure projects expected to drive rapid growth in all areas of the economy.

The demand for industrial equipment and spare parts is predicted to increase significantly in the coming years as a result of these projects.

Non-disclosure agreement

In May, Surefire entered into a non-disclosure agreement with the Ministry of Investment to discuss the potential for downstream processing of mineral concentrates in Saudi Arabia and the production and supply of vanadium for its industrial sector.

Current vanadium usage in Saudi Arabia is estimated at 12,000 tonnes per annum growing at up to 5% year-on-year, with the steel industry accounting for 90% of total demand.