Australia-headquartered Vanadium Resources (VR8) has signed a memorandum of understanding (MoU) with China-based Hunan Zhongxin New Materials Technology for the offtake of 4 000 t/y of vanadium oxide, over a period of five years.
The nonbinding MoU states that Hunan can extend the offtake agreement by a further five years.
VR8 owns 74% of the Steelpoortdrift vanadium project, in South Africa’s Limpopo province.
The company has secured three nonbinding MoUs within the last month, which exceeds 100% of the project’s Phase 1 output.
The other MoUs signed were with Panjin Hexiang New Materials Technology and Enerflow Technology, which are also based in China.
The competitive tension will allow VR8 to extract the best financing terms for supply from Steelpoortdrift, including potential for pre-payment, corporate investment and project-level interest.
This will minimise dilution and maximise project net present value for shareholders, VR8 states.