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8 September 2017
Alexander Mining plc
("Alexander" or the "Company")
Vanadium Research and Development Project
· Research and development project for potential vanadium leaching technology
· Vanadium is important for use in speciality steels and battery technology
· Funding for project provided by Multicom Resources
· Multicom Resources entitled to a technology licence for the use of any IP created
· Success payments due to Alexander
· Complementary to existing interest in high technology metals
Alexander is pleased to announce it has agreed a significant new research and development ("R&D") joint venture project ("JV") for the potential recovery of vanadium from amenable ores ("Vanadium Leaching Technology"). The JV is between Alexander, Australian company Multicom Resources Pty Ltd ("Multicom"), and John Webster Innovations Proprietary Limited ("JWI"), whose principal is John Webster, a mining industry consultant with a strong background in innovative mineral processing solutions.
If the JV is successful, the potential use of a new Vanadium Leaching Technology would initially be focused on Multicom's Saint Elmo vanadium project in North Queensland, Australia.
Martin Rosser, CEO, said: "We look forward to working with our partners in investigating the potential creation of a viable commercial process for the recovery of vanadium by using leaching. This initiative is complementary to our current interest in high technology metals innovative processing methods."
Nathan Cammerman, Executive Director, Multicom Resources, said: "The collaboration between Multicom, Alexander and JWI is an important step for our Saint Elmo project as it now moves into its feasibility and permitting stages. If successful, it will enable the development of Multicom's world class project to be the lowest cost producer of vanadium pentoxide globally."
Research and Development Joint Venture
Under the JV, Multicom will provide a maximum funding commitment of AUD$250,000 for the R&D programme, which will be conducted by JWI in two stages. Firstly, an initial test work programme, for which the interim maximum funding commitment is AUD$35,000. If this work is successful, it should lead to flow sheet development to pre-feasibility level, and to be followed by second stage feasibility test work, the scope of which would be determined at that time by the JV parties.
Any JV IP created will be owned by Alexander, Multicom and JWI one third each. Multicom has been granted a licence for the use of the potential Vanadium Leaching Technology on terms that include a gross sales revenue royalty for the use of the potential new IP on an exclusive basis in Australia and non-exclusive basis for the rest of the world.
Multicom also has an option to convert its rest of the world licence to an exclusive worldwide licence in return for a payment of US$1,500,000 each to Alexander and JWI at any time within three years from the date of execution of the JV agreement.
Alexander will provide certain management services to the JV and where Multicom successfully uses or sub-licences to another party the potential Vanadium Leaching Technology in a commercial scale mineral processing plant exceeding one hundred (100) tonnes of vanadium saleable product per annum, then Multicom would pay the following success payments to Alexander:
1. an amount of US$400,000 payable within five business days from the date of completion of a definitive feasibility study for each successful project that, to the reasonable satisfaction of the Licensee, establishes the technical, economic and financial feasibility of the use of the potential Vanadium Leaching Technology;
2. an amount of US$300,000 payable within five business days from the date of the first commercial sale and shipment of saleable vanadium product that is substantially derived from the use of the potential Vanadium Leaching Technology; and
3. a further amount of US$300,000 payable within three calendar months from the date of the first commercial sale and shipment of vanadium saleable product that is substantially derived from the use of the potential Vanadium Leaching Technology.
This announcement is inside information for the purposes of Article 7 of EU Regulation 596/2014.
For further information, please contact:
Mobile: +44 (0) 7770 865 341
Non Executive Chairman
Mobile: +90 543 533 0665
Alexander Mining plc
Tel: +44 (0) 20 7078 9566
Northland Capital Partners Limited
Matthew Johnson / Gerry Beaney
+44 (0) 20 3861 6625
Turner Pope Investments (TPI) Ltd
James Pope / Ben Turner
+44 (0) 20 3621 4120
Background on Vanadium
Source: US Geological Survey and others
Vanadium's primary use is as a hardening agent in steel, in which it is critical for imparting toughness and wear resistance. These properties are especially important in high-strength low-alloy (HSLa) steels. Vanadium-containing steels can be subdivided into microalloy or low-alloy steels that generally contain less than 0.15% vanadium and high-alloy steels that contain as much as 5% vanadium. Vanadium has been used together with aluminium to give the required strength in titanium alloys used in jet engines and high-speed airframes. Catalysts are the leading non-metallurgical use for vanadium.
Vanadium is becoming more widely used in green technology applications, especially in battery technology. The vanadium Redox battery ("VRB") is being installed for commercial energy storage across Africa, Asia, Europe, and North America. The main advantages of the
VRB are that it can offer almost unlimited capacity simply by using sequentially larger storage tanks, can be left completely discharged for long periods of time with no ill effects, can be recharged by replacing the electrolyte if no power source is available to charge it, and suffers no permanent damage if the electrolytes are accidentally mixed.
Vanadium occurs in deposits of phosphate rock, titaniferous magnetite, and uraniferous sandstone and siltstone, in which it constitutes less than 2% of the host rock. Significant quantities are also present in bauxite and carboniferous materials, such as coal, crude oil, oil shale, and tar sands. Because vanadium is typically recovered as a by-product or co-product, demonstrated world resources of the element are not fully indicative of available supplies.
• Usage of vanadium as a steel additive in high-strength steel accounts for approximately 92% of current global demand of 180,000 tonnes Vanadium Pentoxide (V2O5). Market currently dominated by China and Russia.
• Vanadium demand increasing as a result of global trends towards lighter weight and higher strength steels. Particularly in China where changes to building standards require increased vanadium content in steels.
• Leading researchers estimate that the increasing intensity of vanadium in steel will result in a long-term demand growth of 3.45% CAGR to 2025 resulting in 70,000 tonnes V2O5 additional market demand by 2025.
• In addition to growth in demand from high end steel industry there is significant potential demand in grid scale battery usage. Vanadium based batteries (already deployed in over 700 locations globally), have the capacity to supply multi-megawatt scale base load storage.
Background on Multicom Resources Pty Ltd.
• Privately held Australian based company focussed on the development of world class Vanadium deposits.
• Extensive exploration and drilling of the Saint Elmo project in North Queensland puts the company ahead of peers. Significant volumes within JORC (2012) measured compliant resource estimate. Feasibility studies and environmental impact assessment studies are now underway and a mining lease application is currently being prepared for lodgement.
• Broad brush economic calculations for the Saint Elmo project already indicate positive NPVs for various capital and operating cost scenarios.
• Forecast Vanadium Pentoxide supply shortfall against a backdrop of increasing demand, coupled with a lack of advanced projects in the development pipeline, provide for accelerated project development timelines.
• Multicom's wholly owned subsidiary, Freedom Energy Pty Ltd, is currently facilitating storage opportunities with a leading Vanadium battery manufacturer in order to provide additional pre-mine production revenue streams.
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