Tando Resources (ASX: TNO) has shored up direct shipping ore potential at SPD in South Africa after pipe samples returned numerous “exceptional” vanadium grades assaying more than 2% from surface.
A further 20 whole rock samples have been extracted from 12 vanadium pipes across SPD with seven assaying above 2% vanadium pentoxide (in-situ).
Tando claims this grade exceeds many of the world’s currently operating vanadium mines.
Out of the 20 samples, the average vanadium pentoxide grade was 1.87%, with the pipes also located within a 3km radius of the known vanadium deposit, which hosts a SAMREC resource of 500 million tonnes grading 0.78% vanadium pentoxide.
According to Tando managing director Bill Oliver, the vanadium pipe sample results provide the company “with an outstanding opportunity at SPD”.
“In light of these latest results, we will accelerate our assessment of the potential to establish a DSO operation at SPD,” he added.
The company is currently preparing a drilling campaign to convert the SAMREC 500Mt resource to JORC code.
Drilling will also test the high-grade pipes, with Tando’s strategy to unlock a lower-cost, high-grade DSO operation to generate cash flow in the near term.
“The existing vanadium deposit is, by itself, highly attractive by global standards due to its grade and size. But these high-grade pipes could boost the viability even further,” Mr Oliver noted.
SPD is in a similar geological setting to major vanadium operations including Glencore’s Rhovan, Bushveld Minerals Vametco and International Resources’ Mapochs.
Due to its proximity to major operations, SPD also has access to critical infrastructure and a skilled work force.
The previous SPD explorer VanRes produced magnetic concentrate from SPD vanadium, which offered up consistent grades of 2% vanadium pentoxide and 13% titanium dioxide.
VanRes also conducted drilling with notable results including 9m at 1.34% vanadium pentoxide and 10.5% titanium dioxide from 9m; 13m at 1.13% vanadium pentoxide and 7.43% titanium dioxide from 10m; and 20m at 0.96% vanadium pentoxide and 8.35% titanium dioxide from 11m.
Vanadium supply and demand
Around 85% of the world’s vanadium arises out of South Africa, China and Russia, with the majority of the mineral consumed in the steel sector.
However, the rise of the vanadium redox flow batteries and the green energy revolution has led to predictions vanadium demand will “significantly increase”.
Many vanadium redox flow battery developers claim the battery outperforms existing ones on the market, with a longer life span of about 20 years.
Additionally, the battery is capable of holding charge up to 12 months and discharge completely without detriment. The battery is also scalable, enabling it to be incorporated in larger renewable infrastructure grids and is believed to have greater chemical stability due to the sole electrolyte element.
Lazard (NYSE: LAZ) has published research that the vanadium redox flow battery’s “levelised cost of storage” outpaces the lithium-ion battery by up to 32%.
Meanwhile, vanadium redox flow battery development has been constrained by an absence available of “battery grade” vanadium pentoxide.
Reflecting the tight supply situation, the price of vanadium pentoxide has surged from US$3.50 per pound in early 2017 to its current level of US$15/lb.
Tando claims SPD could become a “globally significant” vanadium producer based on its tonnage and concentrate grades.