Vametco is an integrated mining and processing plant located 8 km northeast of Brits in the North West Province of South Africa. The operation owns the new order mining rights for vanadium and other associated minerals over Portion 1 of the farm Uitvalgrond 431 JQ and Portion 1 of the farm Krokodilkraal 426 JQ in Brits. Vametco operates an open pit mine supplying ore to a vanadium processing plant located on the same properties. Vametco employs a total of 472 employees and contractors.
Vametco’s open pit mine is approximately 3.54 km long, extending in a west-east direction. The ore body is well-defined, continuous and dips in a north-northeast direction at approximately 19 to 20 degrees. The mine is based on a JORC compliant resource of 186.7 Mt, including 48.4 Mt reserves with in-magnetite vanadium grades averaging 2.02 % V2O5. Bushveld Minerals is targeting to grow production to a sustainable level of more than 4,200 mtVpa.
Vametco’s processing plant receives ore from the co-located Vametco mine. Vametco employs the standard salt roast and leach process to produce a trademark VCN product called NitrovanTM. The process involves the following stages:
- Step 1: crushing, milling and magnetic separation to produce a magnetite concentrate with average grades of approximately 2% V2O5 in magnetite;
- Step 2: Salt-roasting of concentrate, involving roasting of the concentrate with sodium salts in a kiln at approximately 1,150°C to form a water-soluble sodium vanadates material;
- Step 3: leaching and purification involving dissolution of roasted vanadium concentrate in water, purification and precipitation of vanadium through the addition of ammonium sulphate followed by drying and then processing in a reducing environment to produce an MVO product; and
- Step 4: NitrovanTM production: the MVO is briquetted and fed into a shaft induction furnace in a nitrogen atmosphere to produce NitrovanTM, a trade-mark vanadium product used in the steel industry, and MVO.
Vametco delivered a solid financial performance in 2018, underpinned by a strong vanadium price environment. The FeV market mid-price averaged US$81.2/kgV for the 12 month period, an increase of approximately 150 % over the prior year: – Revenue increased 131 % to US$183 million; and – EBITDA increased 353 % to US$108 million.
Vametco’s 2018 production costs of US$19.7/ kgV were among the lowest in the world, placing it in the first quartile of the vanadium cost curve.
Unit production cost of US$18.90/kgV to US$19.50kgV is expected for the 2019 calendar year, underpinned by economies of scale. This represents a two to four % reduction relative to the 2018 unit cost.
The table below shows a summary of the key figures for the years 2015, 2016, 2017 and 2018.
Most of Vametco’s product sales in 2018 were to the US, where the price on average traded $10/kgV higher than in the European and Chinese markets. We intend to continue supplying to higher-priced markets in future.