Element 25 has roared back to life with record daily production after repair and modification works of the processing plant were completed at its Butcherbird manganese project in WA. The processing plant modifications, which were undertaken following a shaft failure late last year, delivered improved production volumes averaging 934 tonnes per day since kicking the plant back into action on 23 December 2021.
The daily production throughput record was smashed by the company on the 3 January 2022 when it produced a whopping 1,209 tonnes of concentrate in a single day.
Furthermore, Element 25 believes that it has identified multiple additional optimisation opportunities that it plans to follow up on to increase production even further.
The shaft failure, although not ideal, did create a chance for Element 25 to implement a range of new engineering upgrades that have produced significant improvements. Since coming back online, the production plant has managed to surpass its nameplate production of 1,000 tonnes per day by a healthy 209 tonnes for the stage 1 production plant.
News of the production records sent investors piling into the stock driving the company’s share price almost 25 per cent higher to an intraday peak of $1,49 from a previous close of $1.20.
Element 25’s Managing Director, Justin Brown said:
“The record daily production of 1,209 tonnes achieved on 3 January is equivalent to annualised production of over 400 Kt per annum which exceeds our 365 Ktpa nameplate capability. Whilst it is premature to make firm forecasts on annual production volumes, it is highly encouraging to see this step-change in process plant performance after the implementation of the planned improvements.”
In addition to production throughput capacity increases and repair works, a range of other plant modifications have been undertaken. Recent modifications will allow improved plant access for maintenance, reduce wear on key components and improve dust and noise control in addition to a series of other benefits.
Element 25 is an emerging Western Australian manganese producer that supplies its products to the burgeoning EV battery market. As supply constraints for nickel and cobalt tighten, battery manufacturers are shifting focus to use high manganese cathodes as a comparable alternative to conventional nickel and cobalt filled cathodes.
The Butcherbird project seems ideally placed to feed the growing manganese demand worldwide and the company has plans of becoming the world’s first supplier of zero carbon manganese for use in EV cathode manufacture.
Plans for a stage 2 expansion of the companies processing facilities followed by a stage 3 development are set to go ahead during 2022 to further refine the process. A scoping study for the expansion is set to be released this month with a feasibility study pegged to follow in mid-2022.
The Butcherbird manganese project currently houses a JORC resource of over 263 million tonnes of manganese ore with the shipping of processed ore to offtake partners ongoing.
In addition to exporting manganese concentrate, Element 25 has completed extensive research and development into the production of high purity manganese products including battery grade manganese sulphate and high purity electrolytic manganese metal. The Butcherbird manganese ore looks to be a prime candidate possessing the correct characteristics to cost-effectively produce the high purity manganese products.
Butcherbird also sits in an ideal location on the Great Northern Highway and straddles the adjacent Goldfields Gas Pipeline providing solid infrastructure for the project.
Electric vehicle makers are currently scrambling to produce as many batteries as possible which, according to Morgan Stanley’s latest report, should underpin a 39.5 per cent increase in global battery production by 2030. Accordingly, the shift towards manganese cathodes needed to keep up with battery cathode production is expected to drive strong demand for battery grade manganese.
Element 25 has a solid manganese resource base, an outperforming mill and a bundle of research and development behind it that should put it in good stead to take advantage of the expected future manganese supply deficits.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
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