12th Jul 2023 10:00
(Alliance News) - Neometals Ltd on Wednesday said it has signed an offtake deal with Glencore PLC for the vanadium produced from a project in Finland.
The London-based sustainable battery materials producer said the Glencore deal is with Novana Oy. Novana is a subsidiary of joint venture company Recycling Industries Scandinavia AB, which Neometals owns just under 73% of.
Novana will exclusively sell and deliver all saleable vanadium-bearing products, including vanadium oxide and ferrovanadium.
The deal will run for an initial five-year period, automatically extending in two-year increments unless one of the firms decides not to renew the deal. Neometals said the delivery period begins in January 2026, with the price payable for the vanadium products dependent on current market prices.
Glencore will also offer technical help to Novana during the development of the project.
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 a [final investment decision] 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."
Neometals shares rose 3.8% to 27.50 pence each on Wednesday morning in London.
By Harvey Dorset, Alliance News reporter
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