Technology Metals Australia Ltd (ASX:TMT) has executed a non-binding memorandum of understanding (MoU) with one of the world’s largest steelmakers, setting the course for vanadium offtake discussions.
Together with India’s Tata Steel — part of the global Tata Group — TMT will investigate whether there’s scope for a downstream technical collaboration, which could lead both parties to jointly develop ferrovanadium production facilities in India and WA.
Beyond that, Tata Steel will also discuss a potential investment into Technology Metals Australia and/or its Murchison Technology Metals Project (MTMP), where it’s out to produce high-purity vanadium pentoxide and possibly other downstream products, such as vanadium electrolyte, ferrovanadium and vanadium nitride.
Strategic steelmaking mineral
Vanadium products are integral to the steel industry — they increase the strength, toughness and wear resistance of the iron alloy.
In fact, mixing just one kilogram of vanadium with one tonne of steel doubles the alloy’s strength.
The construction sector is the biggest consumer of steel products and vanadium plays an essential role in providing cost-effective solutions by increasing the strength of reinforcing bars in buildings, tunnels and bridges, and strengthening steels to resist fire, earthquake and corrosion.
Vanadium is also used in aerospace applications to provide low density, high strength and strength at high operating temperatures — essential for components such as aero-engine gas turbines and airframes.
And in automotives, the inclusion of vanadium assists in strength, reliability, ease of manufacture and highest strength-to-weight ratio to minimise fuel consumption and increase economic efficiency.
Beyond industry, however, research also shows the global energy transition hinges on strategic minerals like vanadium, which is versatile enough to support technologies that can decarbonise the construction industry.
Where does TMT come in?
Technology Metals is developing the high-grade Murchison Technology Metals Project, 50 kilometres south of Meekatharra in Western Australia.
The project is designed to be a stable, secure, long-term supplier of critical minerals like vanadium, forecast to produce 27.5 million pounds of vanadium pentoxide per annum over an initial 25-year mine life.
The MTMP hosts an ore reserve estimate of 44.48 million tonnes, grading 0.89% vanadium pentoxide, between the Gabanintha and Yarrabubba deposits.
Realising the potential of that reserve is where Tata Steel comes in.
About Tata Steel
Tata Steel is the 10th-largest steelmaker in the world, reporting a near- US$33 billion turnover in FY22.
The steelmaking giant can produce up to 34 million tonnes of steel per annum, and it uses ferrovanadium and vanadium nitride in its steel alloying process to increase the material’s strength and wear resistance.
Tata Steel’s vice president of group strategic procurement Rajiv Mukerji said: “Vanadium is a key component in Tata Steel’s steelmaking process to increase strength and reduce weight, and as our customers increasingly look to reduce their carbon emissions, we anticipate demand for these products to grow.
“Working with Technology Metals Australia Limited on opportunities surrounding primary vanadium and ferrovanadium production aligns with Tata Steel’s strategy to ensure reliable, stable supplies of raw materials to meet our customers’ future product requirements.”
Reducing emissions in steel applications
TMT managing director Ian Prentice said his company was very excited to partner with one of the world’s largest steelmakers, as well as furthering Australia’s important trade relationship with India.
“High purity vanadium pentoxide from the MTMP is important in producing lower emission ferrovanadium and vanadium nitride, which Tata Steel utilises in its steelmaking process,” he explained.
“Together, TMT and Tata Steel can play an important part in reducing emissions in steel applications as the world progresses towards net zero carbon emissions.”
The fine print
The MoU between TMT and Tata Steel establishes a framework for ongoing discussions regarding offtake, technical collaboration and financing support for TMT and the MTMP or any downstream processing opportunities.
One of the key areas of discussion surrounds a potential technical collaboration, which would assess the technical viability of:
- ferrovanadium and vanadium nitride products, vanadium content and impurities and resulting impact on steel characteristics/quality and value in use; and
- optimal production processing routes, relevant environmental regulations, availability, and cost of required inputs for production within India versus Australia.
Finally, both parties will consider whether a joint investment in downstream processing is worth pursuing.
It’s worth noting that this non-binding MoU is effective for five years unless the parties mutually agree to formally terminate before that deadline.
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