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Element 25 Limited (E25 or the Company) (ASX:E25) is pleased to provide an update with respect to the planned production of high purity battery grade manganese sulphate monohydrate (HPMSM) from manganese oxide concentrates currently produced at the Company’s 100% owned Butcherbird Project (Project) including key developments in the delivery of a Feasibility Study (FS) for the Company’s first HPMSM production facility (Facility).
Summary/Key Points
Project Location
- The United States Inflation Reduction Act (IRA) to inject hundreds of billions of dollars into clean energy EV incentives and programs.
- Geopolitical shifts associated with the IRA have caused a perceptible change in the appetite for North American produced battery materials including HPMSM.
- Offtake demand interest based on discussions with OEMs may therefore drive potential reprioritisation to a USA base case for the E25 Feasibility Study.
- Multiple suitable sites in the USA being actively assessed as location sites focussing on minimising project capital, local reagent supply, co-location opportunities and optimisation of the supply chain.
- E25 appoints Worley Group to lead the engineering studies for FS localisation for a USA site.
- Ernst & Young to advise on potential federal, state and local funding support for a USA based HPMSM Facility.
- Sarawak Malaysia remains a favourable location for a second E25 HPMSM facility subject to approval of federal government incentives.
Feasibility Study Timeline
- Redirection of engineering resources to cover a potential USA location will result in an adjusted FS delivery of Q1 CY23.
- The adjustment to the delivery schedule is not expected to materially delay the delivery of first product to market which remains in the project schedule for 2025.
Flowsheet Piloting Update
- Purification test work completed and produced very high-quality HPMSM liquor with very low impurity levels with results in line with processability and quality expectations. Full test results and confirmatory assays pending.
- Supports E25’s ambition to ultimately offer an ultra-high purity manganese sulphate monohydrate (UHPMSM) product.
- Product liquors will be utilised for continuous crystallisation testing commencing in January 2023 to confirm engineering input data for the crystallisation and separation equipment design.
Project Financing
- The Company is pursuing a combined offtake/financing solution with OEMs and cathode manufacturers to provide substantial project funding.
- Project offtake and financing strategies scheduled to be finalised in line with the Feasibility Study.
Important macro-economic and geopolitical influences support the business case for HPMSM production from an Australian manganese source including widespread efforts to electrify the global vehicle fleet, as well as supply chain ESG considerations which require more scrutiny on material provenance and a move towards diversifying the source of supply of critical minerals.
E25 is assessing several locations in line with its ambition to develop multiple processing locations to serve the rapidly expanding lithium-ion battery material markets in different geographic regions, with a short-term focus on Asia and North America.
Flowsheet Development
Pilot Scale Test programmes
Purification test work has progressed in line with the originally defined plan and has produced some very high-quality liquor with very low levels of impurities which could potentially pave the way towards E25’s production of a new product specification, termed ultra-high purity manganese sulphate monohydrate (UHPMSM).
Australian produced manganese sulphate liquor was shipped to North America for subsequent piloting and the results obtained during 24/7 continuous operation piloting runs have met expectations, in processability and quality, with no significant issues that could not be managed. Full test results are presently being analysed and additional and confirmatory assays are being concluded.
Liquors produced will undergo continuous crystallisation testing commencing in January 2023, aiming to confirm the engineering data for the proposed crystallisation and separation equipment. This testing program is scheduled to be concluded during February 2023 and will also provide additional HPMSM samples to supplement the present inventory.
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This article includes content from Element 25, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
E25:AU
Infill Drilling Completed at Butcherbird Targeting Reserve Extension to Support Expansion
Current reserves are based around mineral resources within granted mining lease M52/1074, of which less than half has been drilled to a sufficient density to meet the requirements for measured and indicated classifications. The balance is classified as inferred. The additional drilling will provide infill data to better define and potentially convert these areas to indicated or measured categories to support the re-estimation of mine reserves. The increase in the “reserve tail” will support project financing activities with NAIF and other potential financiers who are currently undertaking project expansion due diligence2.
HIGHLIGHTS
- 207 percussion drill holes have been completed for 6,202m targeting infill of existing inferred resources.
- All samples have been dispatched to Bureau Veritas for assay with results pending.
Figure 1: Aerial photograph of the resource infill drilling rig with support vehicles and personnel.
The Project hosts a global resource of over 260Mt of manganese ore3 however the current reserves are limited to the areas which have been drilled out to measured and indicated classifications which are required as the basis for a statement of reserves. The current drilling programme was designed to infill existing inferred resources to a sufficient data density, based on variographic analysis, to convert the inferred resources within granted mining lease M52/1074 to indicated and/or measured.
The additional drilling information, combined with historical data, will be used to recalculate the resource base to support a recalculation of the proved and probable reserves to support project financing activities for the Butcherbird Expansion Project by increasing the “reserve tail”. Samples have been submitted for assay with results pending.
Figure 2: Drillhole collar location plan summarising existing and proposed drillhole collar locations.
Element 25 Managing Director Justin Brown said:
“This drilling programme will allow the global resource at Butcherbird to be recalculated with a higher degree of certainty which is expected to result in a signification conversion of inferred resources to measured and indicated classifications to increase the reserve tail in support of the planned ramp up to 1.1Mt production rates.”
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This article includes content from Element 25 Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
Element 25 Extends Share Purchase Plan
- Extension of Element 25 Share Purchase Plan with revised closing date, Wednesday, 26 June 2024 at 5:00pm AWST.
- Funds raised from the Share Purchase Plan will enable the Company to progress its current prime projects at the Butcherbird mine site (located in the southern Pilbara region of Western Australia), as part of the Butcherbird Stage 2 Expansion Project, as well as continuing to support the high purity manganese sulphate monohydrate (HPMSM) project to be built in Louisiana, USA in partnership with General Motors LLC and Stellantis NV.
- Shareholders can request an electronic copy of their personalised Share Purchase Plan form via Element 25’s share registry, Automic Group.
Element 25 has been made aware by shareholders that postal deliveries relating to the SPP have taken longer than anticipated. The extension of the SPP will allow eligible shareholders additional time to consider their position and provide sufficient time to submit their applications and payment.
Under the SPP, the Company will offer eligible shareholders, who were registered shareholders as at 5:00pm (AWST) on Monday, 20 May 2024 (Record Date) the opportunity to apply for up to $30,000 of new fully paid ordinary shares (New Shares). New Shares will be issued at $0.27 per share, equivalent to a 14% discount to the volume weighted average price (VWAP) of Element 25 shares over the last five trading days prior to the announcement of the SPP1.
A revised indicative timetable with the new closing date for the SPP is as follows:
REVISED SPP TIMETABLE
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This article includes content from Element 25 Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
E25 Investigates Butcherbird Restart Options Amid Record High Manganese Ore Prices
HIGHLIGHTS
- Manganese ore prices rise to four-year highs to U$8.30/dmtu for 44% cif Tianjin, China1.
- E25 operations team and Board investigating opportunities to process ROM and low-grade stockpiles at Butcherbird.
- If operationally feasible, ore production at current prices presents an opportunity to generate short-term cash flow.
GEMCO’s Groote Eylandt Mine typically produces more than 6M tonnes of high-grade manganese ore a year, and damage to the mine’s haul road and ship loading facilities from Tropical Cyclone Megan in March 2024 has resulted in a forecast supply disruption of up to twelve months. GEMCO is currently targeting a production restart in Q3 2025.2
Figure 1: Manganese ore index – Yuan/dmtu Tianjin Port1. Butcherbird Expansion Feasibility Study parameters also shown3.
The loss of GEMCO supply coupled with political instability in South Africa has resulted in a significant and rapid increase in manganese ore prices due to increased competition for available supply. This presents an opportunity to potentially sell stockpiles that are of a lower grade, preventing their previous sale at lower prices but which may be profitable to ship now.
Additionally, ROM stockpiles that have been mined but not yet processed are available at site. The cost structure of a restart is not currently defined, however E25’s Board recognises the potential opportunity of selling existing product stockpiles and/or recommencing the processing of ROM stockpiles at Butcherbird to produce material for sale at current elevated prices. If viable, these activities will occur in parallel with and will not impact the expansion plans for the Butcherbird Project. E25 suspended Butcherbird production in early 2024 during a period of depressed ore prices while readying for an upgrade of facilities to achieve a nominal 1.1Mpta manganese concentrate production, as outlined in a Feasibility Study completed on January 20243.
The expansion of Butcherbird production aligns with E25’s strategy to produce high-purity manganese sulphate monohydrate (HPMSM) at a facility planned to be built in Louisiana, USA, in partnership with global automakers General Motors LLC and Stellantis NV4.
Element 25 Managing Director Justin Brown said:
“A potential restart of Butcherbird’s processing operations at these increased manganese ore prices on a de-risked basis may be an ideal opportunity to monetise existing stockpiles and generate short-term cashflow. E25 looks forward to updating the market further as these investigations are completed and we will continue to monitor ore markets in the meantime to optimise any potential opportunities that may arise.”
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This article includes content from Element 25 Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
