Largo’s plans to expand vanadium production capacity by 25% garners more interest
Date: Aug 02, 2018
Largo Resources Ltd. (TSX: LGO | OTCQX: LGORF) is a Toronto-based strategic mineral company focused on the production of vanadium flake, high purity vanadium flake and high purity vanadium powder. The Company’s focus is on their 99.84% owned open pit Maracás Menchen Mine located in Bahia State, Brazil. The property totals 17,690 hectares and has excellent access to the national electricity grid and access from Salvador via a paved 405 km secondary road connected to the main coastal highway. The town of Maracás has a population of approximately 25,000.
Vanadium is traditionally used to harden steel. China’s recent regulations that require stronger steel rebar, is pushing the demand for vanadium required in the hardening process. CEO Mark A Smith explains: “I think the best thing to think about vanadium is rebar, because that’s where 50% of the vanadium is used today. Rebar is of course used to strengthen buildings, roads and bridges, and give them much better seismic strength.” The trends in the steel industry, are now demanding increasingly stronger and lighter products for advanced applications. Vanadium demand has a compound annual growth rate of over 6% for the past several years; however recently vanadium has become a burgeoning commodity.
Additionally, Vanadium Redox Batteries (VRB) are becoming increasingly popular especially for large scale commercial energy storage in China. China has an enormous amount of solar and wind capacity that blend perfectly with this type of energy storage. In terms of green energy these batteries are very efficient as they can absorb energy, as well as release the energy simultaneously and very quickly. The type of vanadium used in energy storage applications is vanadium pentoxide (V2O5).
Largo Resources Processing plant at their Maracás Menchen Mine in Brazil
According to the Company, Largo’s Maracás Menchen Mine boasts the highest grade (1.15% V2O5, or 3.4% concentrate grade) vanadium deposit yet discovered and has accomplished a unique feat in the mining industry, by successfully financing, building and bringing a project to production in a trying market environment and in a unique commodity. V2O5 cost of production is US$4.11/lb. The Company states: “Our vision is to be the lowest cost, highest grade vanadium producer in the world, while maximizing overall shareholder value and continually maintaining the respect of our employees, communities we operate in and with all relevant stakeholders.”
