Australian battery materials producer Neometals has signed an offtake agreement with commodities producer Glencore for all vanadium products developed at the Vanadium Recovery Project (VRP1) in Finland.
Under the agreement, Neometals’ majority-owned subsidiary Novana will be responsible for exclusively selling all the saleable recovered vanadium-bearing products from the VRP1 to Glencore for an initial period of five years.
Neometals said in a statement: “The price payable for the vanadium-bearing products produced and delivered is tied to a prevailing market publication.”
Through a joint steering committee, Glencore will provide technical expertise, including advice and insights, during the VRP1 initial development phases.
Novana is a wholly owned subsidiary of VRP1’s joint venture company, Recycling Industries Scandinavia AB (RISAB).
Neometals owns a 72.5% stake in RISAB while Critical Metals holds the remaining 27.5% stake.
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Neometals managing director Chris Reed said: “Securing take-or-pay offtake for 100% of VRP1 vanadium products represents a significant milestone as we progress towards an FID this quarter. Removing volume risk on offtake is seen as a key requirement for securing project finance and we have mitigated this risk with the take-or-pay nature of our offtake agreement with a Tier 1 counterparty in Glencore.
“The offtake agreement further emphasises the anticipated future need for high-purity material in the market. This is supported by significant expected demand from the vanadium redox flow battery sector and other potential high purity applications.”