BUSHVELD MINERALS

BUSHVELD MINERALS

Fulfilling demand for an ever sought-after resource

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THE VANGUARD OF

Vanadium

anadium is a mineral on the rise. A grey, soft and ductile high value metal invaluable to sectors such as alloys, chemicals and especially steel, its value has risen by 400 percent in the space of two years.

With demand for vanadium on the rise, huge opportunities exist for companies able to find and extract the metal, especially outside of China, and AIM-listed Bushveld Minerals is one

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Bushveld Minerals CEO Fortune Mojapelo discusses the Company’s journey to become an increasingly prominent Company in the global vanadium market

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Writer: Tom Wadlow Project Manager: Donovan SmithÂ

such firm with bold growth ambitions.

It is one of only three producing primary vanadium operations and one of only two vanadium focused play companies in the world.

Further, the South African organisation is leveraging the mineral to develop and promote Vanadium Redox Flow Batteries (VRFBs) in the growing global energy storage market through Bushveld Energy, its energy storage developer and component manufacturer.

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Bushveld Minerals currently commands four percent of the global vanadium market, and through development of projects at its Bushveld Complex the firm aims to increase that share to five percent by 2019.

Gathering momentum

The past year has been the busiest in the Company’s relatively short history to date. Incorporated in January, 2012, Bushveld Minerals spent its first years exploring for vanadium – it completed a scoping study on the Mokopane Vanadium Project in April 2014 followed by a prefeasibility study in February, 2016.

“On 6 April 2017, through the acquisition of Vametco, the Company transitioned from an exploration Company into a significant global vanadium producer,” recalls Bushveld Minerals’ CEO Fortune Mojapelo. “This laid the groundwork for our growth

into a mid-tier low cost, vertically integrated primary vanadium platform.

The acquisition was further aligned with the Company’s aspirations in the global energy storage space by providing capacity for potential electrolyte manufacturing.”

Fast-forward to the present day, and Bushveld Minerals is comprised of three main divisions – Bushveld Vanadium, Bushveld Energy and Lemur Holdings, the Company’s coal business.

Bushveld Vanadium itself is split into three operations. Recently acquired Vametco is the primary low-cost vanadium mining and processing operation with a 142.4Mt JORC resource, including 26.12 Mt Reserves with in-magnetite vanadium grades averaging 1.96 percent V2O5.

The Brits Vanadium Project comprises prospecting rights on several farms adjacent to Vametco.

The mineralisation is outcropping and a continuation of the Vametco

deposit strike with similar or higher vanadium grades. Historical drilling has shown grades of as much as 2.6 percent V2O5 in-magnetite. In March 2018, an exploration programme commenced which showed positive drilling results.

Finally, the Mokopane Vanadium Project is home to one of the world’s largest vanadium deposits with a 298 Mt JORC resource including 28.5 Mt Reserves. A key priority for the remainder of the year is to secure a New Order Mining Right for the project, and subsequently develop the resource.

Expansion at Vametco

“In 2017, Vametco commenced a three-phased expansion project with the aim of increasing annualised production capacity to more than 5,000 mtV during 2019,” Mojapelo explains. “Phase One of the expansion plan was successfully

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AQUANIC

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or 27 years Aquanic has grown into a group of companies with various related business lines in civils and fluid management solutions.

We achieve service excellence through application of our extensive knowledge, skilled workers, experience in designing and installation by implementing the best option which is cost effective, sustainable and manageable.

Our business is built around environmental legislation, clients’ standards and procedures and design criteria, assisting clients in achieving their goals.

“We adopt a rigorous approach in analysing market dynamics for each of our chosen commodities to understand industry structure, current and future supply/demand balance and implications for the underlying price” completed on time and on budget in the September, 2017 quarter, during which Vametco reached an annualised production capacity of 3,035 mtV. “Phase Two of the expansion plan was successfully completed on time and on budget in June, 2018, during which Vametco reached an annualised production capacity of 3,750 mtV, through the installation and commissioning of the third primary milling circuit and secondary crusher.”

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Aquanic, in partnership with Bushveld Vametco, is the contractor for the civil works on the new Magnitite Tailings dump. All earthworks, drainage, HDPE and geotextile lining along with weekly survey and plotting is part of our work.

www.aquanic.co.za Phase Three will increase the site’s annualised production capacity to over 5,000 mtV by the end 2019, enhancing its position in what is a structurally challenged market. This project will also permit the development of downstream operations and facilitate product diversification.

Immediate priorities

Beyond expanding output at Vametco and further exploring and developing the Brits Vanadium and Mokopane Vanadium projects, Mojapelo outlines his plan to list on the Johannesburg Stock Exchange.

“This is a move that will allow South African investors access to our story while broadening the Company’s access to capital to facilitate its aggressive growth plans and enhance its profile further in the global capital markets,” he says.

As the Company grows, Mojapelo also explains how it will need to simplify in terms the organisational

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CYCLONE ENGINEERING PROJECTS

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ur expertise is to operate and manage cyclone tailings storage facilities (TSFs). The field of expertise, apart from the cycloning, has been expanded into spigot TSF and paddock TSF construction, with the full range of TSF construction/management covered.

Hydraulic mining of old TSFs is part of the package and is done by remotecontrolled self-propelled guns and remote-controlled guns mounted on excavators.

T +27 11 660 9466

www.cyclones.co.za

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FLUID AND WATER MANAGEMENT TURN KEY SOLUTIONS

Our Services: Mining Civils Reservoirs HDPE Piping & Lining Specialized Boreholes Mining Rehabilitation

Nico: 082 553 2116 www.aquanic.co.za

SHAPING THE FUTURE. WORLD SKILLS ON YOUR DOORSTEP Tailings disposal and hydraulic reclamation of tailings is our business. We specialise in the operations and management of Tailings Storage Facilities (TSFs) in the mining industry.

Cycloning, spigotting and daywall paddocking form part of our portfolio.

Apart from the operations and management of TSFs, our expertise expands into the reclamation of TSFs by means of hydraulic monitoring.

5 Begin Street T: +27 11 660 9466 Krugersdorp 1739 C: +27 82 789 9458

www.cyclones.co.za

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structure to improve Bushveld’s exposure to the underlying cash flows of its assets, and develop capacity in areas such as human resources, finance and business processes.

Regarding Bushveld Energy, having already delivered its first VRFB project with Eskom this year, immediate priorities include growth of the VRFB project pipeline across Africa, generating interest with downstream stakeholders, developing its own electrolyte manufacturing plant, positioning itself as a key low-cost electrolyte supplier while securing offtake agreements. Finally, the Company expects in the second half of 2018 to be in a position to outline its business model, cashflow capabilities

and valuation in Bushveld Minerals For Lemur Holdings, a 30-year concession for an initial 60MW and associated transmission lines was secured in May, 2018, with plans to complete SEIA and Bankable Feasibility studies for the 136 million-tonne coal Imaloto Power Project in Madagascar.

Four pillars of success

The hallmark of Bushveld Minerals’ project approach lies in four core principles it strictly adheres to.

First is choosing the right commodity. “We adopt a rigorous approach in analysing market dynamics for each of our chosen commodities to understand industry structure, current and future supply/demand balance

TATA CHEMICALS

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part of the more than $100 billion Tata Group, Tata Chemicals is the world’s second largest producer of soda ash with manufacturing facilities in Asia, Europe, Africa and North America.

Tata Chemicals South Africa is located in Durban harbour and has a bulk storage facility with a capacity to store 30 kilotons of soda ash, and the facility also boasts low-cost handling of goods from ship to shore and a complete supply and logistics solution.

The Company continues to play an uplifting role through social support as part of its drive initiative to improve the quality of life of the people it serves.

T +27 31 205 9252 E rmpofu@tatachemicals.com

www.tatachemicals.com

A rigorous and dynamic approach to commodities

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Se rv Tata Chemicals South Africa is a regional leader in bulk chemicals handling.

140 Johnstone Road, Maydon Wharf PO Box 948, Durban 4000 South Africa

Outlook Creative Services

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Situated in the Port of

Tel: +27 31 205 9252 Direct +27312742675 Fax: +27 31 205 1811 Cell: +27 829235946

Outlook Publishing’s awardwinning in-house team is now utilising its extensive production skills to offer a full and bespoke range of editorial, design and marketing services via its new Outlook Creative Services division.

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www.tatachemicals.com

VISION By embracing technology we will have surpassed the needs of thousands of our customers throughout Africa, in doing so enabling them to take their businesses to new frontiers. By creating a climate without boundaries and limitless possibilities and by encouraging initiative and lateral thinking we will have taken ordinary people and created extra ordinary results.

MISSION STATEMENT Provide lateral solutions to business through technology.

METHODOLOGY We provide business solutions through services and technology to mainly manufacturing and distribution companies. We do this by designing and implementing ERP (Enterprise Resource Planning) solutions using SYSPRO and providing ancillary requirements and training.

COMPANY OVERVIEW

F O R M O R E I N F O R M AT I O N V I S I T: www.outlookpublishing.com/creative-services

The company was established in 1994 and renamed Intuitive IT Solutions in 2014. The owner has had extensive experience in the industry before moving into SYSPRO support as well as supplying hardware and infrastructure based on each unique sites requirements. Within the organization we have specialists in the Financial, Distribution and Manufacturing arenas. Together we have amassed over 40 years of support and implementation experience.

E: Ingrid@iitsolutions.co.za | C: +27 (0) 82 568 9332 T: +27 (0) 11 453 0016 | F: +27 (0) 11 454 2512

www.iitsolutions.co.za

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and implications for the underlying price,” Mojapelo says. “Vanadium is in a structural deficit, with limited supply and a growing demand.”

Commodity chosen, the next pillar revolves around cost and stability to deal with price fluctuations. Mojapelo adds: “Vametco, the Company’s flagship asset, is one of the lowest cost primary producers while enjoying some of the highest grades. The Company’s strategy is for the assets to be in a position of generating cash in every phase of the commodity cycle.”

Third, the project must show a clear path to achieving production, as demonstrated by the ongoing success at Vametco. “We therefore target brownfield processing assets that can be acquired at a fraction of their replacement cost or develop greenfield projects that have a low up-front capital expenditure and are scalable,” Mojapelo says.

Such production should also be able to scale up, again highlighted by the three-stage Vametco development.

Bushveld Minerals intends to increase production from 5,000 mtV in 2019 to 10,000 mtV in the medium-term.

Adherence to these pillars could not be successfully achieved without the relevant personnel and expertise on board. The management in place in the Company’s subsidiaries are highly experienced operators in the commodities they are focused on.

Vametco’s team, for example, combines more than 100 years’ experience in vanadium mining and processing.

“Bushveld Minerals has over the years attracted a highly experienced team with multi-disciplinary skills who all share our long-term vision,” adds Mojapelo.

“Our policy is that the remuneration arrangements, including pensions for subsequent financial years, should be sufficiently competitive to attract, retain and motivate high-quality executives capable of achieving the Company’ objectives, thereby enhancing shareholder value.”

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Looking ahead

With the expertise in place and formidable vanadium assets being further explored, developed and mined, Bushveld Minerals is set to play a leading role in the rapidly rising global industry.

Add to this the snowballing demand for battery and energy storage technology and the likely continual rise in vanadium’s value, and the Company appears to be on course to deliver prosperity for its shareholders and other stakeholders, not least the immediate communities in which it operates.

Mojapelo concludes: “Having

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“The transformation to a producer with healthy cash flows, while very satisfying, is only a step in our journey to build one of the most significant lowest cost vertically integrated vanadium companies in the world”

completed the transformational acquisition of Vametco, we look forward to continuing to diligently execute the strategy that we have articulated across all of our platforms.

“The transformation to a producer with healthy cash flows, while very satisfying, is only a step in our journey to build one of the most significant lowest cost vertically integrated vanadium companies in the world.”

“The transformation to a producer with healthy cash flows, while very satisfying, is only a step in our journey to build one of the most significant lowest cost vertically integrated vanadium companies in the world.”

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5 Harries Road Building 2, 2nd Floor Illovo Edge Office Park  Illovo, 2196 Johannesburg, South Africa Tel: +27 11 268 6555 Fax: +27 11 268 5170 info@bushveldminerals.com

www.bushveldminerals.com

www.outlookpublishing.com