Roskill scoping study: evaluating vanadium’s market strength


As a reminder, our Maiden Mineral Resource Estimate has revealed that Norge Mining’s resource at Øygrei in Norway amount to 1.55 billion tonnes, containing mean grades of 1.74% phosphorus pentoxide, 4.95% titanium dioxide and 0.07% vanadium pentoxide.

Following this, we reengaged our partner Roskill – critical materials supply chain intelligence experts – to provide more information on the potential of our vanadium deposits. Roskill has started identifying the viability of vanadium market entry and which products to target, supported by detailed market analysis, forecasts, and production cost analysis.

Here we outline three important conclusions from Roskill’s scoping analysis and our response.

1. Steel: still the protagonist

Roskill analysis: There appear to be two main strategic options for Norge Mining going forward: the production and sale of vanadium pentoxide (V2O5) and ferrovanadium/vanadium nitride.

Steel will remain the largest source of demand for vanadium in tonnage terms, yet its percentage market share will decline slightly over time as other sectors grow. Demand from aerospace has been hit by the pandemic, but should recover in the coming years and demand from Vanadium Redox Batteries (VRBs) could be the largest growth segment over the decade. Aerospace, VRBs and chemicals will require higher grade products, such as high-purity (HP) V2O5 and V2O3. As such, high purity applications could provide an important diversifier and risk reducer following on from standard grade vanadium pentoxide production.

Norge Mining response: The global vanadium market is expected to grow by 38.5% over the next ten years, according to Roskill. Norge Mining has several possible ways of exploiting the orebody. The in-situ vanadium quantity of the resource at the Øygrei deposit amounts to more than 1 million tonnes, expressed as V2O5. This is equivalent to five times of the global vanadium consumption in 2020.

Currently Norge Mining is executing an Identification Phase Study (Concept Study) to evaluate the various mining and metallurgical process options, to identify attractive investment opportunities.

The vanadium in the orebody can be recovered by magnetic separation. The resulting vanadium containing magnetite concentrate will metallurgically be converted to marketable commercial grade V2O5, with the option to convert the commercial grade V2O5 into high grade vanadium compounds (V2O3, V2O5) – for the vanadium redox battery market, among others.

2. Beyond steel: new demand

Roskill analysis: The vanadium market is poised to see significant changes during the decade both for demand and supply. Traditionally, the steel industry is the largest market for vanadium, accounting for about 90% of consumption, mostly through ferrovanadium (FeV) and vanadium nitride (VN). The main driver has been increasing Chinese steel production, in line with the country’s industrialisation and urbanisation and increasing usage intensity of vanadium. Roskill estimates that China accounted for 57% of total vanadium demand in 2020. China’s vanadium consumption also accelerated in recent years driven by new rebar regulations, which aimed at improving safety standards for construction.

Although steel will remain the main market for vanadium for the foreseeable future, non-steel applications, primarily vanadium redox batteries (VRBs) could become a significant new source of demand in coming years. Roskill has recently proceeded to a review of the sector and subsequently revised upwards its vanadium demand numbers coming from VRBs, as developed in a following section.

Norge Mining response: In the Identification Phase Study, Norge Mining is evaluating the production of HP vanadium compounds (V2O3, V2O5) for the vanadium redox battery (VRB) market. The VRB sector is expected to grow over the next ten years and detailed market analysis indicates that it could double in this timeframe.

3. Shortening supply chains

Roskill analysis: Norge Mining may be able to position itself strongly within Europe, as one of the larger producer of vanadium oxides with a significant market share. Vanadium is listed as a critical raw material by the European Commission, and the local regional market could be an asset in terms of shortening supply chains, lowering carbon impact and helping the positioning of a product as more “green”.

Europe is positioning itself as a hub of development within the energy transition, and some key research institutions and VRB companies are operating within the EU. The rising demand for premium high purity V2O5 or V2O3 products in relation to renewable energy storage could provide Norge with strong market opportunities.

Norge Mining response: From a sustainability standpoint there is a growing industry preference for the onshoring or regionalisation of raw material supply chains. Gaining a strong position as a vanadium supplier will support Europe in its endeavours to reduce its carbon footprint – and the wider world.