Interesting Ann and obviously a move in the right direction. In looking at project economics within the DFS concept the key is around mass recovery and then refinery recovery.
High level understanding before delving into specifics of the Ann In the concentrator you have grinding, crushing, magnetic separation that produces the concentrate for input into the refinery. Recovery in the refinery process is where the roasting process actually occurs. Too many when they compare vanadium deposits often fall in love with a concentrate grade and do not understand the underlying recovery of getting that concentrate, especially how it feeds to viability. The mass recovery rate for AVL is going to be high. A while ago I explained this from looking at this pic posted by AVL:
The formula used in the slide, which needs to include a refinery recovery, is as follows: :(tonnage x ore grade) * (concentrate grade/ore grade) * mass recovery * refinery recovery
Understanding mass recovery is actually the key of viability, rather than focusing on concentrate grades alone. In the example above, concentrate grade in the second row is almost twice that of the first row, but because of mass recovery you get far more tonnes of V205 in the 1st row.
Running log and this Ann and improvements in project economics: A key question for me is what was the input feedstockin this Ann - fresh, transitional or oxide . The previous METs, including how they fed into the December 2018 PFS, gave varying mass recoveries (and also refinery recoveries) depending on where the ore came from. This is explained in this post itself by me: Post #: 36854785 and what is in the post translated to these comments in the December 2018 PFS - page 5 of 90 - Post #: 36902221.
"Metallurgical recoveries for the concentrator have been determined from testwork and indicate an average vanadium recovery of 44% for oxides, variable vanadium recovery with depth up to 87.8% for transitional and variable vanadium recovery with grade from 76.7% to an expected maximum of 96% for primary material (for a grade of 1.5% V2O5). Metallurgical recoveries for the refinery range from 79.7 to 80.6% and have been determined referencing the study team’s experience from similar benchmark operations and support by preliminary roast leach testwork. Relative to the current metallurgical understanding deleterious elements such as silica, alumina and chromium, and their effect on operating cost, recoveries and product quality, have been considered."
Thie above explains the generally quoted mass recovery AVL quotes of about 60% and refining recovery of 78% in the above slide.
So returning to this Ann of today, it would appear that they are able to increase recovery, but suspect the ore that they are referring to is likely to be a combination of fresh and transitional orefeed (and not the oxide layers). From today's Ann, I think this is the most important statement:
Why, well it seems to me they are going to target the fresh and transitional orefeed in the first five years, meaning higher mass recovery plus refinery recovery. And noting the 8% increase in recovery in this Ann itself, and the statement around 'low cost producer', this means from an IRR/NPV sense that you maximise benefits of that production profile given the way discounting works in outyears in feasibility studies. The question still remains around the vanadium price itself, and furthermore how the economics stack up in the DFS itself. Dealing with the oxidised laters later on, actually helps viability in a IRR/NPV model given the manner in which discounting works.
The DFS will be an interesting read given this Ann, the move to APV from AMV and the costs/benefits of putting the processing facilities at Mullewa instead of doing the processing at minesite. te wildcard will be whetehr AVL are able to secure either some 'free funding' or 'cheap funding' through their Major Project Status (which might include government upgrading some of the infrastructure in the area and not AVL - a watch this space there btw). Obviously any help by government, means a lower construction/finance cost for AVL which helps project economics.
Anyway, might return to hibernation again @sandfire but VA does need to get a move on in terms of the DFS, albeit the key ingredient outside VA's control is the V205 price. But the PFS was done in December 2018, these latest results are delayed btw, so the question always has been here how focused to the task is management. Time will tell.
(20min delay)