Element 25 sets date for first manganese ore at Butcherbird

ASX-listed Element 25 says it will be processing manganese ore by the back end of next month at its new Butcherbird manganese project in the Pilbara. The company says it will dry commission the plant in the first half of March and achieve wet commissioning and start processing ore by the end of the month, representing a significant milestone in the history of the company.

Remarkably only 10 months will have elapsed since Element 25 released its Mark I version of a pre-feasibility study on Butcherbird that sits about 130 kilometres south of Newman to when the scheduled commissioning takes place.

Element 25 Managing Director, Justin Brown said: “To deliver a mining project in such a short time frame whilst maintaining a high level of safety and cost control is a fantastic achievement by the team. This is an important first step in the development of the project which can then be expanded into the battery metals markets.”

The current stage one mining and beneficiation project development heralds the first milestone of a multi-staged strategy involving a possible expansion of Butcherbird to produce a high purity manganese sulphate product for lithium batteries.

According to Element 25, manganese has emerged as an increasingly important ingredient in electric vehicle batteries as potential supply constraints loom for nickel and cobalt, prompting battery manufacturers to look at manganese for battery cathode manufacturing.

The Perth-based, $212 million market-capped company delivered a head-turning Mark II pre-feasibility study on Butcherbird late last year.

That study predicts an annual operating cash flow of $39.6 million per annum before tax from a ridiculously low CAPEX estimate of $17 million for the stage one development and a staggeringly low anticipated working capital requirement of just $3.2 million.

Element 25 has already locked in an offtake partner for all of the 365,000 tonnes of manganese ore per annum that is forecast to be produced for the initial five-year period under a binding take-or-pay contract with OM Materials.

OM Materials is a wholly owned subsidiary of ASX-listed Singapore-based integrated manganese and silicon group, OM Holdings.

Butcherbird’s proved and probable reserves currently stand at 50.55 million tonnes of ore at an average grade of 10.3 per cent manganese for 5.22 million tonnes of contained manganese, representing only about 20 per cent of the global mineral resource on an ore tonnage basis.

Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au