Joint venture to develop vanadium processing project at Windimurra welcomed

4/11/97

Western Australia's Resources Development Minister Colin Barnett has congratulated Precious Metals Australia on its joint venture with Swiss company, Glencore International, to develop a $95 million vanadium processing project at Windimurra, 80km east of Mount Magnet.

Precious Metals Australia (PMA) has announced plans to 'fast-track' development of its vanadium project following the positive outcome of its feasibility study. Glencore has signed a Heads of Agreement with PMA for the project and has committed $35 million toward development costs. Glencore will also provide support for debt financing the balance in return for a 51 per cent share in the project. PMA will be manager of the project.

PMA has advised the Government that it is the joint venturer's intention to have more than 90 per cent Australian content in the project - the majority of which will come from WA. The project will employ 500 people during peak construction and provide 100 permanent jobs.

"Windimurra will be a great boost to the State's Mid-West," Mr Barnett said.

"The project is an excellent example of the value-added industry we want to see in WA. It also reflects the growing diversification in our resource sector."

At full capacity, the processing plant will treat 2.2 million tonnes of ore per annum to produce an estimated 15.8 million pounds of vanadium pentoxide worth around $90 million at current prices. Over its estimated mine life of 30 years, the project is expected to generate up to $3 billion in export revenue according to PMA.

Vanadium is primarily used to strengthen steel and in specialty alloys, though its use in batteries is expected to increase significantly in the years ahead.

PMA will develop and operate a mine, process plant and infrastructure at the Windimurra site. It also opens up an opportunity for a gas pipe lateral into the Murchison. With commissioning planned for the third quarter of 1999, Windimurra will be Australia's only vanadium project. It will produce approximately 11 per cent of the world market according to PMA. South Africa currently produces over 75 per cent of the world's vanadium pentoxide.

Glencore is one of the world's largest commodity trading companies and one of the leading vanadium producers. It already owns two mines in South Africa. Glencore is also a joint venture partner in Anaconda's $900 million Murrin Murrin nickel project on the Goldfields.

Media contact: Justine Whittome (08) 9222 9699