Australian Vanadium Ltd (ASX:AVL) is trading higher after securing a $3.69 million matched funding Federal Government grant to help design, build and operate an Australian vanadium battery electrolyte plant.
The competitive manufacturing award, formally known as the Resources Technology and Critical Minerals Processing National Manufacturing Priority Grant, will support the ASX-lister as it develops its namesake Australian Vanadium Project in Western Australia’s Mid-West region.
Managing director Vincent Algar said the funding runway would also enable AVL to add further value to its planned vanadium product production.
Shares are more than 16.6% higher to 2.1 cents intra-day.
Minister of Industry Science and Technology Christian Porter announced the grant award today.
Cash injection to accelerate project development
Australian Vanadium managing director Vincent Algar said AVL was pleased to have been awarded the Australian Government grant.
“The grant will enable us to add further value to the vanadium products we plan to produce in Australia from the proposed development of the Australian Vanadium Project in the Mid-West region of Western Australia.
“The grant will provide support to AVL to achieve production of high-purity vanadium pentoxide, which is a key input to vanadium-titanium master alloys for critical steel applications and vanadium electrolyte for batteries.
“In turn, this will assist the development of the project, with the company now in discussion with offtakers for vanadium electrolyte in addition to vanadium pentoxide.
“The grant will allow AVL to produce vanadium electrolyte commercially to support the development of the long-duration energy storage market, which will play a key role in future grid stability in this renewable energy generation era.
“Vanadium redox flow battery (VRFB) battery systems are easier to manufacture than other batteries, due to the use of only a single metal component, vanadium, to store the energy.
“They are ideal for accelerating battery manufacturing in Australia, using locally produced vanadium and other battery components.”
Demand for vanadium-powered VRB batteries is poised to grow over the next four years.
Bringing VRFBs to Australia
Essentially, the Federal Government’s matched funding grant will support Australian Vanadium’s plan to:
- Include a high-purity processing circuit to produce battery, chemical and master-alloy grade vanadium pentoxide as part of the development of the Australian Vanadium Project;
- Build and operate a commercial vanadium electrolyte plant based in WA, to support the rollout of vanadium redox flow batteries (VRFBs) in Australia; and
- Manufacture prototype/demonstration residential and stand-alone power systems (SPS) based on VRFB technology, for distribution into Australian energy markets.
Australian Vanadium is determined to showcase how vanadium-powered batteries can bring long-lasting energy storage solutions to the Australian market.
Its namesake Australian Vanadium Project has been awarded Major Project Status by the Australian Federal Government and Lead Agency Status by the Western Australian Government in recognition of its strategic importance as a critical mineral and battery mineral project.
The ASX-lister is also developing a $7.4 million manufacturing plant in WA, where it hopes to turn vanadium pentoxide into vanadium electrolyte for VRFB battery projects across Australia and the Asia Pacific.
Vanadium electrolyte is a long-term energy storage component in these types of batteries — which provide between three and 12 hours of energy storage — and comprises between 30% and 60% of a battery’s overall cost.
Diagram illustrates how redox flow batteries use vanadium electrolyte.
Australian Vanadium is also invested in the VRFB-powered energy systems through its VSUN Energy spinoff.
Launched in 2016 to focus on the practical rollout of vanadium-powered batteries within Australia, the business is assessing how these batteries can provide energy storage across several sectors, including residential, solar and telecommunications applications.
VRFB batteries could be used to power the home.
Part of $1.3 billion manufacturing initiative
Ultimately, Australian Vanadium’s newly won manufacturing grant forms part of the broader $1.3 billion Modern Manufacturing Initiative.
Established in February 2021, the program is a Federal Government strategy designed to “super-charge manufacturing and grow jobs” across six national manufacturing priorities — one of which is resources technology and critical minerals processing.
Speaking to the grant in a press release today, Minister Porter said Australia’s resource sector was world-class.
“Through our $1.3 billion Modern Manufacturing Initiative, we are helping to unlock this enormous potential by providing targeted support for projects that will deliver big rewards for our local economy in terms of export earnings and new job opportunities.
“It is also critical that we build our sovereign capability in this sector, with China currently the world leader in critical minerals processing including battery production.
“Whether it’s building large-scale battery systems, adding value to critical minerals exports through new refining techniques, or driving the adoption of battery power in mining vehicles, these projects will increase Australia’s international competitiveness and help position us a future leader in this crucial sector.”