getting a move on , page-4

An interesting article on Vanadium outlook and applications. Sounds very positive.


High-tech uses for vanadium to drive demand, prices higher


By: Henry Lazenby

23rd August 2012

TORONTO (miningweekly.com) – The need for increasingly stronger steel prescribed by modern building standards and codes, as well as its burgeoning use in new battery technologies have heated demand for vanadium.

The transition metal, which is mainly produced as a by-product from iron-ore mining, has in recent years seen a steady rise in demand from the steel construction industry as building regulations, especially in China, increasingly call for improved strength and lighter construction materials.

More recently, however, the development of large-scale vanadium-redox flow batteries (VRFBs) for use in energy grid storage applications was opening up a new demand stream for the transition metal.

Traditionally, the metal was used to strengthen steel products. In fact, about 85% of vanadium is used in the high-performance steel industry, containing between 0.05% to 4% vanadium.

The other main vanadium use is in titanium alloys, and about 10% of vanadium, in the form of high-purity pentoxide, is converted into master alloys that are consumed in titanium alloy production. It is vanadium pentoxide that is increasingly proving itself as a versatile new player in the field of green energy solutions.

EXPENSIVE METAL

Market intelligence firm Lux Research recently published research that investigated the global adoption of VRFBs. It found that VRFB adoption is slow owing to the restrictively high capital cost of the technology, when compared with that of other batteries for grid storage applications, such as lithium-ion and sodium nickel chloride or ‘molten salt’ batteries.

Although grid energy storage systems come at a capital premium, costs savings might be achieved in the long term when electrical energy is stored during times when production from power plants exceeds consumption and the stores are used at times when consumption exceeds production. In this way, electricity production could be maintained at a constant level, which reduces costs.

The latest research pointed to VRFB as being more suited to grid energy storage systems, as it has a “sweet-spot” of effectively discharging electricity over longer periods than the contemporary technologies are able to sustain, Lux Research associate Brian Warshay told Mining Weekly Online.

He pointed out that the single biggest factor inhibiting the uptake of VRFB technology is the price of vanadium, which accounts for up to 38% of the flow-battery’s makeup. The price of vanadium pentoxide for use in the electrolyte of VRFBs is the “lynchpin” to the technology’s success, he added.

“Locking in secure and consistent long-term vanadium pricing would yield stability and price guarantees, while relying on the excessively volatile market pricing for vanadium pentoxide could result in an insecurity of supply and uncontrollable price volatility,” Warshay told Mining Weekly Online.

Warshay said upscaling the facility might reduce the overall cost of running a VRFB grid storage system, while increasing the energy density of the VRFB would also yield cost reductions by decreasing material quantities and reducing land, site construction, and installation costs.

VRFBs are unique among chemistries owing to the fact power capacity and energy capacity can be scaled up independently from one another. For large systems with the same power capacity, increasing the discharge duration from two to seven hours reduces capital costs by 40% on a per kilowatt-hour basis.

LIMITED SUPPLY

However, a steady and cheap supply of vanadium is hard to come by, as the world’s top producers are China, South Africa, Russia and the US.

Australian vanadium-project developer Midwest Vanadium put worldwide vanadium consumption at about 65 000 t/y, while industry sources expect this figure to significantly rise in the next five to ten years.

But this production is mainly from the by-product of iron-ore mining, and the North Americas does not have a primary vanadium-producing mine – yet.

Project developer American Vanadium is steadily working on its flagship Gebillini project, in Nevada, which would become the sole primary vanadium mine in the US when it is permitted, “hopefully by the end of 2013”, president Bill Radvak told Mining Weekly Online.

The company is aiming at supplying the local steel market, which currently fully relies on vanadium imports, while it is also structuring its production model to be able to partner with high-technology companies in the chemical energy market, at no extra capital or operating cost.

"American Vanadium is actively seeking opportunities for offtake agreements and vertical integration with both the steel production and the renewable energy storage/battery industries,” he said.

Radvak expected the demand for vanadium to increase significantly in the coming years, driven higher by increased demand for state-of-the-art materials for the aerospace and chemicals industries, increased construction demand from China and from the VRFB business.

“As we develop the only domestic [US] vanadium mine, our overriding corporate objective remains to build the vanadium flow-battery business in the US through partnerships with global technology leaders. As the energy storage industry grows over time, it will consume an ever-increasing percentage of our product mix as vanadium electrolyte.

“In the meantime, we can now increase project profitability by directing our product line towards other higher-margin products rather than simply selling ‘purple flake’ to the steel industry,” the company said in a recent statement.

The company on Monday announced a $2-million private placement, which would be used for mine design, environmental permitting and general working capital.

Grid energy storage is a booming industry in Asia and to a lesser extent in Europe; however, the Americas lagged far behind in the implementation of such systems, and American Vanadium planned to take advantage of the growing market, Radvak explained.

Edited by: Creamer Media Reporter
http://www.miningweekly.com/article/high-tech-uses-for-vanadium-to-drive-demand-prices-up-2012-08-23